FAQs on starting up (part 2): Studying the market

Q: Should I do market research before plunging in?

A: If you want to lose your shirt, don’t. You should do market research especially if you’re launching a new product or service, or suspect the market may be saturated. You need market research to target your market, confirm a niche, or validate the attractiveness of a sales outlet.  You need to know if there is   room for one more competitor in the market.

Q: What kinds of research can I do myself for starters?

A: Talk with people already in the business you want to join. Visit industry associations; browse in the library; surf the Internet for secondary research, read trade journals and industry statistics..
To know the competition, visit trade shows to see what’s already being offered, for how much, and how buyers are responding. Get a feel of what’s going on.

If you can put a questionnaire together, get a small group to ask prospective customers in your target area how they would respond to the product you plan to introduce.

Q. How do I go about doing my own market survey?

First of all, you have to select your sample group of people to survey.  To get useful market research data, your respondents need to be representative of your target population.  These are people who will likely be interested in buying your products.  Are these students?  Housewives? Young professionals?  Married couples?  Retirees?

You have to be careful in designing your questionnaire.  Make sure it is focused specifically on the information you need to know.  Avoid questions that would offend such as how much money people earn or how.

Questions should be clear or straight to the point. Use the language (English, Filipino, Taglish or the local dialect) that your respondents would be sure to understand and easily reply to.

Keep it short.  Remember you are taking up respondents time and shouldn’t bother them unnecessarily.  Try to keep all questions in one page.

Questions that can be answered by “yes” or ‘no” are fine.  It will also help if respondents can tick (check) alternative answers.  However, you should provide opportunity for detailed answers.  These types of responses can be the most valuable to you.

Face to face interviews are best but alternatively you can use email, social media, or the telephone.

At the outset, set the market research criteria.  Determine how many customers would have to express interest in the product or service to make it worth your while to continue researching? 50 per cent? 60?

It is important to remember market research is necessary not only at start-up but at all stages of a business’s life, if you want continued success.
Q: If I can’t do the research myself, how do I find someone to do it for me for a fee I can afford?

A: For a nominal fee, the Department of Trade and Industry has field officers who may be able to do the research for you. You may also hire freelance consultants who charge lower because they don’t have large overhead expenses.

You can try the research department of the UP Institute for Small-Scale Industries.  Or the extension offices of business schools like the St. Louis Extension Institute for Small-Scale Industries in Baguio City, Angeles University in Pampanga, and Notre Dame University in Cotabato.  Or talk with business professors: the market research you need may be a good practicum subject especially for graduate students.

As an alternative, share the research expense with other people offering the same products you’d like to offer.

– to be continued

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