Below is a recording of the presentation I gave on market research to a Princes Trust Networking event in Edinburgh a few days ago. The audio quality isn’t great, so I’ve written it up as a blog for you as well. It’s not a direct transcript but it does cover all the same points.
Today we’re going to talk about some things I wish I’d known about market research when I was starting up my business a couple years ago. Even though I was starting a marketing business, market research was the one thing where I knew I should be doing it, but had no idea what it meant when people said, “Oh you should do some market research about that.”
What I’ve learned is there are two types of market research. One of them is desk research, which mostly involves sitting at a computer, Googling things. And the other is customer research – speaking to actual humans and asking them some questions.
Understanding desk research
So, desk research involves looking up data online. You’re looking for big reports that are relevant to lots of businesses – like census or state of the industry reports. You can use these to answer broad questions that you have about the market you’re going into, or whether your business idea is even going to work.
Many companies which produce these reports charge high fees for you to see the full thing, so you want to track down a local resource which will give you access to similar information – public, national, or university libraries are a good bet.
Free market research reports at the National Library of Scotland
Members of the National Library of Scotland can access loads of different databases of market research through the business collections, so if you’re based nearby, then it’s worth becoming a member – and it’s completely free.
Not a paid promotion, by the way, I just really love libraries!
Sample questions for desk-based market research
Getting started with your own desk research, is as simple as writing a list of all the things you’d like to know about your potential customers, your competitors, or the market in your industry. They should be things you need to know to run an effective business. Great questions for desk research include things like
- How many people in Edinburgh have a gym membership?
- How many people in Scotland earn over £30,000 a year?
- What’s the age and gender breakdown in the use of mobile for online shopping?
Once you’ve written them down, the next step is literally to start typing them into Google.
Evaluating data sources found through Google
It’s very important that you check out the sources you’re finding through an internet search. If you take everything at face value, you risk getting caught out by ‘fake news’ or data from biased sources. Download this list of questions to help you evaluate data sources found through Google. If you’re not confident that a source is reliable, find some more sources, maybe with different viewpoints, and see if you can find more evidence.
You many need to patch together a few data sources to get an estimate. If you can only access national statistics on a subject, you could find the national percentage and then apply it to a local population.
Find the right people for your customer research
Now let’s talk about customer research – the part where you find some humans and talk to them about stuff. And that raises two questions – which humans, and what stuff?
You need to find people to talk to people who are currently in your target audience. Put together a quick audience profile, or you can use detailed customer personas if you have them. Customer research can help you flesh out those personas too, if you find you’ve got gaps, or you’ve had to make a lot of assumptions about the characteristics of your audience.
With your audience in mind, think of people you know who, right now, are potential customers. Your own parents probably aren’t target customers for a product aimed at toddlers. A better bet might be, for example, your partner’s second cousin who’s got a toddler of his own right now.
Once you’ve found that first person, they can usually connect you, if you ask them nicely, to other members of your target audience. That cousin will know about all his local toddler and baby groups where he meets other parents of kids the same age. Or your sister who works in a big office near the place you want to open your sandwich bar – she can put you in touch with other colleagues and friends who work in the same building.
Sample questions for customer research
Speaking to your own target customers directly will always give you more detailed information than you could ever find out through a national, or even a city-wide report. So, customer research is essential to fill in the gaps left after your desk research, and to help you to flesh out some more specifics.
It’s also the best way to get information about feelings and decisions and values, which are harder to tease out in bigger surveys. You might ask things like
- How do you decide where to go for lunch when you’re away from home?
- Where do you usually buy basic clothing like socks or underwear?
- When was the last time you searched online to find a new hairdresser?
Using surveys and interviews for market research
Surveys, even of small groups, can help you to patch holes in the numbers you’ve already got. It might be easy to find out how many small businesses there are in Edinburgh (or wherever you live), but it’s harder to find data on how many are looking for support with digital marketing strategy. Believe me, I’ve looked!
Interviews then let you drill down even further into the details. They go beyond just counting how many people do a certain thing or have a certain opinion. Having a conversation gives you more flexibility to ask follow-up questions that expand on or clarify what people are thinking. These details are what help you then to find your niche, your unique selling point, so that you can run a successful business.
A summary of how to do market research for beginners
To recap, there are two main types of market research – desk research and customer research. Start by thinking about the questions you need the answers to, so you can run a successful business. Then head online and search for your questions, and similar queries, to find data sources and large reports. Evaluate data sources you find online to make sure you can rely on your results.
After the desk research, note down where you have gaps, and more questions you want to answer. Think of people you know already who are in your target audience, and through them, connect with other potential customers. Start with a survey to address the gaps from your desk research, and then interview people from your audience, so you can ask good, detail-oriented questions. These results will help you develop a unique selling point for your business so you can write a great business plan and run a successful business.