Find Your Customers Without Spending A Lot of Money
Meet Sheree Johnson, owner and CEO of SJ Insights, which helps businesses make fact-based, strategic decisions before they go to market with a new product, execute a new campaign or make other marketing decisions. Sheree is here to explain how any business can perform quality market research, aka gathering information about the intended customers’ needs and preferences, without breaking the bank. Take notes and get ready to build a stronger, more profitable relationship with your customers.
As a small business, many entrepreneurs and owners may think conducting effective market research is outside of their budget. If you do it right, research can be implemented for any company. By implemented, I mean
Here are 10 tips on how your business can use market research to understand how to best market, price, distribute and promote your product/service:
Tip #1: Start with some basic market intelligence gathering
Use the Internet.
So much information already exists online. You can Google/search for general business articles on your product category, research users/purchasers, study the competition and more. Go deeper than the first page of search results. Many a research jewel has been found by looking at search results through page three or four. Sometimes, these don’t surface to the top, so read the abstracts and scroll down for a few pages.
Review industry publications.
Most product or service categories have a magazine published in the industry. It can be print or online, but in either case, it can provide some useful insights into industry trends, issues, resources, trade show events, etc. Look for an editor’s contact information and call or email them with questions you have about the industry. Editors are also great to network with and will readily put you in contact with subject-matter experts.
Contact industry trade associations.
Most industries have a trade association serving that market, and these organizations are great resources for insight. Start with their website and look under “Resources” or something similar. They typically conduct their own market research on trends and issues in the industry.
Start collecting competitive data.
From pulling a sample ad out of the newspaper or a magazine, to doing a screen capture of an online ad, collect as much insight about your competition as possible. Go to their websites and review their product areas. You might want to do a competitive audit and set up a spreadsheet to compare products (features, benefits, prices), brand positioning and messaging.
Tip #2: Take advantage of free secondary research
Census data, government reports, industry association research and other data exist online. In addition, local media—like radio stations, TV stations and local cable systems—subscribe to a variety of syndicated reports by market (typically Scarborough). Scarborough is a syndicated subscription service Nielsen owns, and it connects Americans’ media consumption with their lifestyles, demographics, product usage, buying behaviors and attitudes for 210 different markets. Just call a station and ask for a local sales rep, and build an ally who will share the data with you.
Tip #3: Do some secret shopping
Whatever your product or service, put yourself in the shoes of the buyer and do some one-on-one secret shopping at retail outlets, trade shows, events, online, etc.
Tip #4: Look to internal sources
Don’t underestimate the power of capturing data from your current employees and customers before you do broader research. Customer service, call centers and sales teams can be a valuable resource when it comes to getting more information about your competition, customer feedback, new products and new markets.
Tip #5: Use your trusted advisers
Most small business owners have business counselors, advisers, mentors or former colleagues they rely on to help with operational issues. But they can also be great, honest resources to help validate topics you would normally research.
Tip #6: Build an email list
Every business owner should have an email list. Make sure you capture customers’ email addresses at a variety of touch points so you can build an opt-in list not only for promotions but also for research. To avoid the monthly fee that many email service providers charge, you may want to try out those that offer free services for having a smaller number of subscribers. For instance, MailChimp offers its service for free for businesses with fewer than 2,000 subscribers. If your list grows beyond that, there are other plan options to consider.
Tip #7: Customer panels
Do a random sampling of your customers and invite them (via email) to participate in a customer panel for your brand, product or service. You could reward them with something of small value for participating (a coupon, gift card, etc.). You can run ideas by your panel via email and get qualitative feedback that is usually quite insightful.
Tip #8: Survey your audience
Many quantitative surveys are done online these days, and it’s very easy to set up a survey using an online tool like SurveyMonkey to design your survey, collect your data and prepare a report. You can do free surveys with 10 questions and up to 100 responses, or you can subscribe to the tool for as low as $25 per month, which gives you an incredible number of added features. You can also tap into procuring respondents from SurveyMonkey and/or using your own email list to garner customer responses.
This is one area where you can spend a lot of money to get professional help, but if you follow a few guidelines, it can be very easy to design surveys yourself. Also, SurveyMonkey has some templates you can use as question formats. It’s up to you to decide what you’re trying to find out, so start by clearly defining an objective for the research.
Tip #9: Put together a focus group
Focus groups provide a great way to evaluate products, concepts or brand positioning, to learn how well they’ll be received by your target audience. However, focus groups are a highly specialized form of market research that requires a professional to organize and conduct them. It is almost impossible to conduct effective focus groups on your own idea, even if you are a trained professional in this type of research.
If you can’t afford to do professional groups with a trained moderator and if you’re really looking for some initial qualitative feedback, you can set up a simple discussion group (at your office or a trade show/expo) on your own. But be cautious and know that you shouldn’t go to the bank with the results: They are directional at best.
To recruit participants, tap into your customer database, or recruit friends of friends/family, assuming you can assemble a group of 10 to 12 people representative of your target market. Don’t directly ask friends/family because they probably won’t tell you the truth.
Prepare a discussion guide about the topics you want to cover, and make sure you know how you plan to gather that information from them. Typically, you are looking for red flags or comprehension issues. Ask them about the pros/cons or what they like/don’t like. Don’t come to a consensus in the group, but rather take their feedback back for consideration and refinement of your ideas.
Tip #10: Use social media
If you have a strong following on any of your social media platforms, Facebook, LinkedIn, Instagram, Twitter, etc., can be a great place to solicit opinions. This will also give you valuable insight about who might actually care about a new product, etc., by seeing who responds to your questions. You can pose a question or two, and seek comments/opinions of your followers. Be careful, though; social media is public, so if you don’t want to reveal to your competition what you’re thinking, you might want to use social media for polling about things that don’t give away your plans.
Doing any market research is better than none, so if you are cash-strapped, hopefully some of these tips work for you. The insights you gather could help you shape your short- and long-term business plan.
However, keep in mind, in order for market research to have any real benefit, it will need to be done accurately. Poorly executed research can produce results that lead you astray. This means that you should take the research you do with a grain of salt. And then at some point, the sooner you can start doing professional market research, the more money you will save in the long run by hopefully preventing misguided business decisions.
Sheree Johnson is the owner and CEO of SJ Insights, located in Leawood, Kansas, providing best-in-class market intelligence and analysis, custom market research, media planning and buying services (including social media marketing), as well as advertising related consulting services. Get in touch with Sheree and SJ Insights now on Twitter or Facebook.