The Importance of Market Research ~ Entrepreneur Starter

An entrepreneur needs to do the market research to determine whether the goods that you sell in accordance with the wishes of the customer or not. Market research is the action or activity of gathering information about consumers' needs and preferences; research into the characteristics, spending habits, location and needs of your business's target market, the industry as a whole, and the particular competitors you face.

The Object of Market Research

There are some things that can be used as research material for market research, that are:

Customer profile and segmentation
Product or service market's demand
The price
Sales and distribution channel

How To Conduct Market Research

1. Focus on the Market. Market Research was conducted to gain the market’s opinion, not to get a justification of your desire. It could go along with whatever you wanted to do, or on the other hand, it could go against it.

2. Decide the Potential Market that you wanted to capture as your target market. You couldn't grab all market segments. So, the most important thing that you should have decided in the first place is the market that you wanted to enter as your target.

3. Create a Questionnaire. This is a media for you to know the market’s desire. You must be able to ensure that all important information would be able to be gained within a single questionnaire. It should consist of questions that would literally tell you what customers’ want.

4. Choose your Respondents. Not all people could be your respondents. Choose the person that you consider as the right person that would give you the beneficial information. For example: if your product/service is a luxurious kind of watches, you couldn’t give your questionnaire to some persons who clearly don’t like to wear watches.

5. Summarize the results that you have gained.

6. Decide. The decision that you are going to make should be the decision that you made based on the market research that you had done before. The result might not the same as whatever you wanted before, but however, it is the market’s demand. As a businessman or manager, the result of the market research is the ultimate decision making tool that you could use.

The most important part in this phase is; if the result of the market research was clearly against your desire, what kind of decision would you make? Is it going to be the same as what was recommended by the market research? Or you decided to overrule the result and went with your own decision?

The Goal of Market Research

1. Searching Business Information

In conducting market research as an entrepreneur you want to know what information is on the market, whether the goods will be sold on the market fit, how the state of your competitors; Could you to compete? therefore necessary market research before starting a business.

2. Market Anticipation

From the results doing market research, you can anticipate when the results show there will be changes in the market. For example, such as the type of products you will not salable in the next few months, you can do the replacement / upgrade the product to adjust to future market demand.

Though you and your potential customers have the similar idea, it doesn’t mean it would be a freeway for you. There would be still many kinds of constraints ahead. Here are the things that you should be concerned about:

Is it something primary, or secondary, or even tertiary?

Does it has substitutions?

Is it attractive enough, especially if the customers compare it with the similar products from competitors?

Do customers know about you?

3. Decision Making

By conducting market research, you can determine a good decision for your company / your business based on the results of market research. So your business will run smoothly.

You should have known the demands of the customers since you have already done the Market Research long ago. If what the customers want, based on the market research, is similar with your idea, then there wouldn’t be any problems. But what if your idea is not the same with the demands, or in fact, it is contrary different with the customers’ demands? You could do 3 OPTIONS:

Get along with the demands, which means, you should give up the whole original idea, which might be different with your passion.
You could be stubborn enough to go on with your idea, with the risk nobody would even care to your business.
Or, you could try to compromise a little bit by creating a whole new business idea which could elaborate the customers’ demands, without sacrificing your idealism.

If your research shows that a proposed business venture has a high probability of failure it would be unwise for you to proceed, unless you’re able to obtain additional information which will change this assessment. If you are in business already, use the information you have obtained to develop your strengths, eliminate your weaknesses and create new opportunities. Above all, remember that market research, like any tool, must be used correctly to achieve a satisfactory result.

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