Market Research for Small Businesses
June 2023

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Market research is an essential tool for businesses of any size or industry to understand their target audience, identify customer needs and preferences, and gather information about their competitors. In a nutshell, market research helps businesses make data-driven decisions to grow and succeed.

According to the U.S. Bureau of Labor Statistics (BLS), almost 45% of new businesses fail during the first five years, and the reasons are almost always obvious: poor market fit, lack of funds, competition, lousy location, drastic market changes, and others. Most of these challenges can be avoided by understanding customer needs and the market environment, which is what market research does.

Market research may look like an unnecessary step for smaller businesses because it costs money, time, and effort. However, it is an important step that can determine a business’ survival. Although conducting market research can sometimes be expensive and time-consuming, not having proper data can lead to even costlier mistakes and an overall lack of understanding of the market. And market research doesn’t have to be complicated or expensive. In this article, we look at simple steps for conducting market research for small businesses and the important data it can collect.

Steps to Conducting Market Research

One of the first steps in conducting market research is to define the research objectives. This helps the business to focus on the specific information they need. The research objectives should be specific, measurable, achievable, relevant, and time-bound (SMART). Once the objectives have been defined, the business must choose the appropriate research methods to collect the data.

There are two main types of market research methods: primary and secondary research. Primary research is conducted by the business itself and can include surveysinterviews, and focus groups. This method allows the business to collect firsthand information from its target audience and to gather their opinions and feedback. Secondary research, on the other hand, is conducted by using existing sources, such as published reports and studies, government statistics and industry publications.

After the data has been collected, it should be analyzed and interpreted to extract valuable insights. This can be done through statistical analysis, customer segmentation, and competitive analysis among others. Once the insights have been identified, they can inform critical business decisions, such as product development, pricing strategy, and marketing efforts.

Types of Market Research Data that Small Businesses can Collect

There are several types of market research data that small businesses can collect in order to better understand their customers, target market and industry, including:

  • Demographic data: Information about the age, gender, income, education, and occupation of their customers and target market. This type of data can help a small business understand the needs and preferences of their target market and tailor their products or services accordingly.
  • Behavioral data: Information about how customers use a small business’ products or services, as well as their opinions and attitudes towards the business. This type of data can help a small business understand customer satisfaction and identify areas for improvement.
  • Competitive data: Information about the products, services, and marketing strategies of a small business’ competitors. This type of data can help a small business understand its competitive landscape and identify opportunities for differentiation.
  • Sales data: Information about the sales of a small business’ products or services, including information about the number of customers, revenue, and profit. This type of data can help a small business understand its financial performance and identify areas for growth.
  • Social and online data: With the help of different tools, one can collect data from social media platforms, website reviews, ratings, searches, and other online data. This can be helpful to understand how customers view the business, and how they find and engage with the business.
  • Surveys: One of the most potent tools of market research, surveys are a proven way to gather direct feedback from customers, which can be used to improve products or services, customer satisfaction, and understanding of the target market.

The Bottomline

In conclusion, market research is a valuable tool that small businesses can use to gather important information about their target audience, competitors, and industry. By conducting market research, small businesses can make data-driven decisions that will help them to grow and succeed in their industry.

Keep in mind that collecting market research data can be time-consuming and costly, so small businesses need to focus on the types of data that will be most valuable for their specific needs. Engaging experts like GeoPoll can greatly cut the time and money spent while producing more reliable results.

Scott Lansell

Vice President for International Development &Relief, GeoPoll

GeoPoll (www.geopoll.com) conducts international development research for United Nations agencies, NGOs, governments, humanitarian groups and other stakeholders in the development and relief sectors. Our dedicated International Development Team includes experts in project implementation, adaptive management, and more.

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