Why Market Research Will Help Your Business
Why Market Research Will Help Your Business
Is market research only for big corporations with deep pockets? No—actually, any business can put simple market research into place, and get about 80% of the benefit of the big, complex, expensive methods—without paying a penny.
In my own one-person business, I've used informal market research to:
Determine where ad dollars were effective, and where they were wasted. As an example, I advertise in several local Yellow Pages directories. By tracking which ads drew how many customers, over a period of years, I've been able to drastically increase the return on my investment, because if an ad doesn't work, I don't renew it. If I weren't tracking, I could still be paying every month for several directories that I tried but that didn't produce for me.
Get crucial feedback on new product development—testing titles, packaging, price points, and even whether a market even existed for products I was considering—that has saved me many thousands of dollars I could have spent developing the wrong things. The title and cover of my newest book, Principled Profit: Marketing That Puts People First, are vastly better than the originals as a direct result of soliciting feedback from many, many people. And the price point, high enough to ensure a decent profit and low enough to sell as an impulse item, was also based on research.
Understand why different marketing approaches were succeeding while others failed. Early market research, for instance, helped me understand back in 1995 why the mall and bulk e-mail models don't work well online.
Let's look at my new book as an example, because it illustrates a number of different types of market research that you can do on your own, without spending any money.
When I got the idea for the book in August 2002, I sent some notes to business and publishing discussion lists to gauge, in general terms, whether there was sufficient interest to do the book. In the past, I'd received lukewarm response to some of the products I was thinking about creating, and this helped me decide to put my energies elsewhere. This time, feedback was very positive, so I started writing. Then I thought I had a great title, but I was feeling unsure about the subtitle. I asked directly for feedback on my possible subtitle choices—and discovered that there were large segments of my target market that absolutely hated my main title. This began a two-month process of brainstorming, narrowing down, putting possible titles out into the world, and rejecting them. Was there a title for this book?
Once I had a title, I had to choose a cover. My designer worked up several very striking, but controversial, designs, and none of them really told the story of what the book was about. Once again, I turned to my online support groups. His covers evoked strong emotions; people either loved them or hated them. My goal was a cover that got at least a 60% positive rating from this original group.
After a while, I decided the original focus group had been over-exposed to the concept and was no longer reflecting the market. Fortunately, there are many places on the Internet that overlap with the market for this book—so I picked a new focus group.
Meanwhile, the cover designer selected a concept that is a bit less dramatic, but received about an 80% approval rating—and has a good deal more to the with the book. We went with it.
It was exhausting, but it was worth it. Of the hundreds of people who have commented on the final title or cover, only a few didn't like it. The book is much better positioned in the marketplace, as a direct result of this feedback.
From past experience, I can tell you that the wrong title and wrong cover are very expensive mistakes for a publisher to make. An earlier book that I didn't road test sufficiently took seven years to sell 2000 copies, and I think the cover and title were a lot of the problem. This time, not only did the book do a whole lot better, but many of the people who helped along the way felt so much a part of the project that they happily spread the word—a nice side benefit of all the market research.
How to Do Your Own Market Research
Getting information from your customers and prospects is easy! Here are a few of the many possible techniques:
Ask! If you bring people to an event, ask for a show of hands about how they all learned about it (don't forget "from a friend"); if you book clients for appointments, ask at the time they make the appointment; if you run a retail store, let each cashier keep a tally of what brought the customer in, and how much was purchased (an easy way to do this: pre-print some 3x5 cards where the cashiers can check off the source and write the dollar amount).
Join online discussion groups where your customers hang out. Post to the list that you want feedback on a new product or packaging idea.
Set up a web page on your own site to collect feedback.
Use tools like HostedSurvey, which allows you to set up your survey online, hook it to your web site or email invitations to your customer list, collect responses, view reports and download the data to your own computer—and that don't cost you an arm and a leg.
Try a real-life test. For instance, offer a choice of free reports on the same topic. The one that gets the most responses should be the name of your next product.
Use codes. In any direct-mail campaign, advertisement, or online medium, you can know exactly what caused your customer to respond. For instance, an ad would specify a response to PO Box 1164-B1, while a direct-mail letter to, while a particular rented list might be directed to PO Box 1164-N17. Web pages can have tracking codes built right into the URL, so you can analyze them later in your statistics package.
Check out what others are doing. Before I settled on a price for my new book, I visited several bookstores, looking at other titles appealing to the same market. And in a different industry, years ago, I considered leading specialized tours of certain New York City neighborhoods. I contacted the NYC Convention & Visitors Bureau to find out about tours that already existed—and quickly decided this was not a market I could afford to enter, because I live three hours out and there were dozens of fascinating tours already, at rock-bottom prices. Because of my early research, when I abandoned the business idea, I was out only about two hours of my time and the cost of a phone call to the visitor center. Far, far better than investing time, energy and money to develop brochures, work out the tour routes and narrative, and do all the marketing, only to discover that there was no market for what I wanted to do.
How can you put these tools to work in your business? I bet you can think of at least a dozen ways.
This article was originally commissioned and published by Hostedware dotcom, a leading provider of web survey and online testing software for research, education and performance improvement. It is used with their permission.
Why Market Research Will Help Your Business - To learn more about this author, visit Shel Horowitz's Website.
Like this article? Share it with your friends
Do Crucial Market Research For Free, On Your Own
Is market research only for big corporations with deep pockets? No—actually, any business can put simple market research into place, and get about 80% of the benefit of the big, complex, expensive methods—without paying a penny.
In my own one-person business, I've used informal market research to:
Determine where ad dollars were effective, and where they were wasted. As an example, I advertise in several local Yellow Pages directories. By tracking which ads drew how many customers, over a period of years, I've been able to drastically increase the return on my investment, because if an ad doesn't work, I don't renew it. If I weren't tracking, I could still be paying every month for several directories that I tried but that didn't produce for me.
Get crucial feedback on new product development—testing titles, packaging, price points, and even whether a market even existed for products I was considering—that has saved me many thousands of dollars I could have spent developing the wrong things. The title and cover of my newest book, Principled Profit: Marketing That Puts People First, are vastly better than the originals as a direct result of soliciting feedback from many, many people. And the price point, high enough to ensure a decent profit and low enough to sell as an impulse item, was also based on research.
Understand why different marketing approaches were succeeding while others failed. Early market research, for instance, helped me understand back in 1995 why the mall and bulk e-mail models don't work well online.
Let's look at my new book as an example, because it illustrates a number of different types of market research that you can do on your own, without spending any money.
When I got the idea for the book in August 2002, I sent some notes to business and publishing discussion lists to gauge, in general terms, whether there was sufficient interest to do the book. In the past, I'd received lukewarm response to some of the products I was thinking about creating, and this helped me decide to put my energies elsewhere. This time, feedback was very positive, so I started writing. Then I thought I had a great title, but I was feeling unsure about the subtitle. I asked directly for feedback on my possible subtitle choices—and discovered that there were large segments of my target market that absolutely hated my main title. This began a two-month process of brainstorming, narrowing down, putting possible titles out into the world, and rejecting them. Was there a title for this book?
Once I had a title, I had to choose a cover. My designer worked up several very striking, but controversial, designs, and none of them really told the story of what the book was about. Once again, I turned to my online support groups. His covers evoked strong emotions; people either loved them or hated them. My goal was a cover that got at least a 60% positive rating from this original group.
After a while, I decided the original focus group had been over-exposed to the concept and was no longer reflecting the market. Fortunately, there are many places on the Internet that overlap with the market for this book—so I picked a new focus group.
Meanwhile, the cover designer selected a concept that is a bit less dramatic, but received about an 80% approval rating—and has a good deal more to the with the book. We went with it.
It was exhausting, but it was worth it. Of the hundreds of people who have commented on the final title or cover, only a few didn't like it. The book is much better positioned in the marketplace, as a direct result of this feedback.
From past experience, I can tell you that the wrong title and wrong cover are very expensive mistakes for a publisher to make. An earlier book that I didn't road test sufficiently took seven years to sell 2000 copies, and I think the cover and title were a lot of the problem. This time, not only did the book do a whole lot better, but many of the people who helped along the way felt so much a part of the project that they happily spread the word—a nice side benefit of all the market research.
How to Do Your Own Market Research
Getting information from your customers and prospects is easy! Here are a few of the many possible techniques:
Ask! If you bring people to an event, ask for a show of hands about how they all learned about it (don't forget "from a friend"); if you book clients for appointments, ask at the time they make the appointment; if you run a retail store, let each cashier keep a tally of what brought the customer in, and how much was purchased (an easy way to do this: pre-print some 3x5 cards where the cashiers can check off the source and write the dollar amount).
Join online discussion groups where your customers hang out. Post to the list that you want feedback on a new product or packaging idea.
Set up a web page on your own site to collect feedback.
Use tools like HostedSurvey, which allows you to set up your survey online, hook it to your web site or email invitations to your customer list, collect responses, view reports and download the data to your own computer—and that don't cost you an arm and a leg.
Try a real-life test. For instance, offer a choice of free reports on the same topic. The one that gets the most responses should be the name of your next product.
Use codes. In any direct-mail campaign, advertisement, or online medium, you can know exactly what caused your customer to respond. For instance, an ad would specify a response to PO Box 1164-B1, while a direct-mail letter to, while a particular rented list might be directed to PO Box 1164-N17. Web pages can have tracking codes built right into the URL, so you can analyze them later in your statistics package.
Check out what others are doing. Before I settled on a price for my new book, I visited several bookstores, looking at other titles appealing to the same market. And in a different industry, years ago, I considered leading specialized tours of certain New York City neighborhoods. I contacted the NYC Convention & Visitors Bureau to find out about tours that already existed—and quickly decided this was not a market I could afford to enter, because I live three hours out and there were dozens of fascinating tours already, at rock-bottom prices. Because of my early research, when I abandoned the business idea, I was out only about two hours of my time and the cost of a phone call to the visitor center. Far, far better than investing time, energy and money to develop brochures, work out the tour routes and narrative, and do all the marketing, only to discover that there was no market for what I wanted to do.
How can you put these tools to work in your business? I bet you can think of at least a dozen ways.
This article was originally commissioned and published by Hostedware dotcom, a leading provider of web survey and online testing software for research, education and performance improvement. It is used with their permission.
Why Market Research Will Help Your Business - To learn more about this author, visit Shel Horowitz's Website.
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Kim CastleWith nearly two decades in the advertising and design business, with clients like Domino's Pizza, General Motors, Direct TV, Pedigree, Wolfgang Puck, Higher Octave Music, Hollywood Celebrity Products, Disney, and Paramount, as well as thousands of entrepreneurs around the world define, structure, communicate, and position their business for greater profits, BrandU(R) co-creators Kim Castle and W. Vito Montone discovered that entrepreneurs could experience the same power that big brands command for a fraction of the cost with the world's only process-based results-drive Integral approach to business creation. BrandU(R) is helping entrepreneurs grow with the power of extreme clarity from idea...to brand...to market(TM) and helping one million entrepreneurs become successful and whole so that they can make a difference in the world. Are you one of them? If you want to experience clarity all the way to the bank(TM), get started now at http://www.brandu.com. - Visit Kim Castle's Website |
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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