What is the best way to conduct market research for a new professional services venture?
How to conduct a comprehensive market research? What resources would you recommend? Share your tips and experience.
Market research is one of those tasks with few short cuts. My experience leans heavily towards most people when asked a research responsding by how they think they would respond, but not necessarily accurately to how they would actually respond. The logical part of the brain takes over rather than allowing the emotional part of the brain to influence as it typically does.
We will usually engage a Market Research firm to do qualitative research. Their skill is in asking the right questions in the right way and exploring the answers to get to the real responses. The other advantage is that you can sit behind a one way mirror to observe and often pick up some intuitie cues yourself.
At around $5k and upwards you'll need to budget $15k as a bare minimum, and more like $25k as a reasonable budget for this.
My advice is to go on a Listening Tour! Politicians do it all the time and it is great for business too. Make a list the movers & shakers, people you admire and prospects, ask a few smart open ended questions then sit back and take notice. They will be more than happy to tell you what is on their mind. If you listen to what they share with you there will be plenty of opportunities to help them. I did it when business slowed and picked up several new clients but you can do it any time. It is a great way to connect and a lot of fun too. Start listening with no strings attached, you'll be amazed what you find. It does not cost much, for the price of a few coffees and meals you will get an earful. I had no idea what to expect and got a lot of new work as a result. I did my listening tour the old fashioned way by sending out e-mails & picking up the phone then brought a pad & pen, asked a few open ended questions then shut up and started taking notes.
I started a global branding and marketing firm 18 years ago. Earlier in my career I worked in Brand Management at Procter & Gamble and at P&G everything starts with Market Research. They drill into you the importance of customer data to make decisions. It does not matter what you, your friends and family like it is all about your target audience and what motivates them to purchase. At P&G we did lots of quantitative (surveys) and qualitative (focus group) research over months but as a small business owner you have to be scrappy and work fast with a limited budget. You can do surveys using Zoomerang or Survey Monkey along with your Listening Tour to get the most bang for your buck. Good luck!
The best way to start any research is, to begin with, your goals. First, outline clearly what you are aiming to achieve with your research. This will ensure your research has a clear scope and direction.
Some broad areas of research are outlined below.
As with any venture, it is vital to understand your customer when beginning a new professional services venture. Create a clear outline of your customer to help direct your business. Some questions to ask include:
- What is the size of your market?
- What are the demographics of your market?
- What do your customers value?
The most direct method of research is speaking directly with customers. This can be done via a phone call, in person, or online (eg via a survey).
Review existing customer research
An alternative method is reviewing existing customer research. Research that has already been conducted may be sufficient to satisfy your research goals. Search online, or contact industry bodies to see if there has been previous research conducted.
Consider the level of competition that already exists in your intended industry. For example:
- How many other companies exist with the same services in your area/ geographic region?
- What is the pricing range in the industry?
An important element to consider is the demand for the services you intend to offer. Research how much demand there is for your offering. Google Trends can be useful for this type of research.