How To Do Market Research as a Small Business
Are you a founder, maker, or owner in charge of running your business…growing your business…AND deciding between different products or business ideas?
Yep… that’s life.
If you’re wearing all the hats, you know time is a precious resource. You know that market research is a good tool to help test new ideas and make decisions in business - but there’s just not a lot of time for it.
That’s exactly why this article gives you a crash course on how to do market research in 3 easy steps. After reading this post - you’ll understand the basics of how to conduct market research to get the most return on your time.
How To Do Market Research Tip #1 - Wait… Are you skipping market research altogether?!
OK, let’s be real - time is precious as an entrepreneur. You’re so busy working IN the business that you don’t have a lot of time to work ON the business. Market research sounds good in theory… but it’s a “nice to have”, not a “must have.” And anyway - you’re not sure when is the best time to do market research, considering you’re days are packed!
Think about this: Have you ever created packaging, logo or new product idea… then had a hard time deciding between different versions, iterations, or executions of the new idea?
Yes?
Whenever you get those feelings - that’s when you should be doing market research.
Usually, when we start to get overwhelmed with new ideas or branding - it’s because we’re sitting in a room, working on our businesses in a vacuum.
New Flash: Businesses and brands aren’t built in a vacuum.
The best way to grow your business is to get out there and connect with real people - i.e. your customers. Everything in your business that is seen by other people - from new products, to logos and branding, to pricing and promotions - should be centered around making your customers’ lives better.
If you come up with a new business idea - ask yourself; how does this idea serve my ideal customers? How does this idea make my customers’ lives better? How does this solution make them feel?
And if you’re not sure how your new idea impacts your audience… or if you have multiple ideas, and you’re not sure which one is the MOST impactful…then that’s where market research comes in.
Market research is your opportunity to find out how your new ideas, branding, or products are perceived. It’s your opportunity to gut check new ideas before investing time and energy into development; and it’s also your opportunity to discover insights and guidance to refine a new idea when it’s being developed.
The best selling products (and the most successful businesses) always tie products and branding back to their customers’ goals and desires. This is because at the end of the day, people buy from brands they like, know and trust.
And that’s why it’s so important to talk to your customers, and to build your branding or products with them in mind.
Let your audience lead your business; not the other way around.
How To Do Market Research Tip #1 - Know WHEN to do market research: The best time is before you launch a new idea or branding - this way, you can build your new offerings to meet your ideal audiences’ wants and needs.
How To Do Market Research Tip #2 - Ask The RIght People For Feedback
Have you ever been in a Facebook group with fellow founders, entrepreneurs, or creatives - and someone writes in the group asking for feedback on their brand or new product idea?
“Hey guys - I’m in the middle of rebranding and just wanted to get your thoughts on my logo. Which version do you like better?”
“Hey guys - I’m coming up with a new name for my business. Which name should I go with?”
“Hi everyone - I’m creating a new product and want to get your thoughts on what it should be called! What do you guys think?”
Maybe you’ve not only seen this happen…but you’ve BEEN this person!
Let’s get one thing clear: there’s nothing wrong with asking for feedback. I’m a big believer in feedback. Feedback makes you better.
But ONLY if the feedback is coming from the right people.
Let’s take an example. Imagine someone approaches you to ask for help deciding on a logo for an event catering company. You are tasked with helping them decide between two options:
Option 1: A pink, girly logo.
Option 2: A simple black & white logo.
Which do you prefer?
Maybe you gravitate towards the pink logo because you love feminine style and to you, pink feels warm and approachable. Perhaps you have a daughter (or two!) and you see the potential of marketing towards women with a charming, whimsical pink logo that stands out from the crowd. You could see yourself hiring this business to cater girls’ dinners and bachelorette parties.
Or maybe not.
Maybe you hate frivolous things, and think that a pink logo is silly. Maybe you come from a high power corporate background, and using pink is such a terrible idea that you can’t even fathom why anyone would consider it. For you, a minimalist and masculine logo feels professional. Trustworthy. You see the credibility in a logo that is structured and bold - this is the kind of logo you would hire to cater your dinner parties and events.
Do you see how giving feedback is so personal, so subjective, and depends so much on not only your personal tastes, but also your background?
Here’s the bottom line - the way we all respond, react and give feedback depends on our personal taste, as well as our life circumstances. The way you react to a logo or product when you are a mother is likely different from the way you will react one day when you are a grandmother. The brands you were drawn to in college are probably different from the brands you are drawn as a working professional.
And that’s why it’s important to be intentional about who we ask for feedback.
When you ask for feedback in a Facebook group, it’s important to recognize what kinds of people spend time in that group. Depending on the group, you may be soliciting feedback from friends, other business owners, or creators who are also trying to build their businesses - in other words, you may not necessarily be speaking to your target audience.
If you want to understand what appeals to your potential customers, you should be asking for feedback from those potential customers - NOT from fellow business owners.
The bottom line is to solicit feedback in Facebook groups (or other places) where your target customers are hanging out. Oftentimes these places aren’t the same places as the ones where we business owners hang out - so be sure to keep that in mind!
How To Do Market Research: Tip #2 - Identify where your target customers are hanging out - and go where they are. Be sure to interact with real potential customers… not fellow colleagues or entrepreneurs who are giving you advice!
How To Do Market Research Tip #3 - Do You Understand the “Why” Behind The Responses You Are Getting?
Imagine you are in a Facebook group where someone asks for feedback on a logo for an event catering company.
80% of people for a pink, feminine logo
20% of people vote for a black and white logo.
Seems like the right choice is to go with the pink logo - right?
Now what if you learned that the catering company is trying to position itself as a high-end, luxury business that works with brands like Chanel and caters sophisticated, black-tie events. Does that change your perspective?
And what about now: Reading through the comments, it seems like people are voting for the pink logo because it feels chic and sophisticated; while the masculine logo feels ordinary and cheap. In this case - Which logo should the company choose in order to attract their high-end clients?
You see - It doesn’t matter WHAT people choose.
What matters is understanding WHY people are choosing that option - and evaluating whether that “WHY” aligns with your business.
Understanding the “why” behind someone’s response means getting to know them as a person, so that you can align your business to the right people.
Understanding the “why” behind someone’s response to your branding will help you understand the positioning and messaging that is being conveyed to that person; and this will help you decide whether your messaging is actually landing the right way.
There are many layers to asking people for feedback about your brand and business - but make sure to peel back all the layers, and don’t just take peoples’ choices and responses at face value. Sometimes, even if a concept “loses” the popular vote - you may still find that it makes sense to move forward with that concept. It all depends on WHY people chose (or didn’t choose) that concept; and what exactly that concept is conveying to your audience.
How To Do Market Research Tip #3 - Ask follow-up questions to uncover the WHY. “Why did you like this option X better than option Y?” “Why did you like this color better?” These are the questions that will give you deep insight into your messaging and product positioning.
And There You Have It.
Three easy tips on how to do market research:
Know WHEN to do market research. The best time is before or during the development of a new brand, product or service - this way you can build your new offer around the needs and desires of your ideal clients
Ask the RIGHT people for feedback. Go where your target customers are - don’t expect that they are hanging out in the same places as you!
Dig into the WHY. Don’t ever take feedback (even from your ideal customers) at face value. Ask follow up questions. Make sure you understand why people are choosing certain products or options - this will give you insight on what kinds of messaging you are putting into the world, and whether that messaging is landing the right way.
Hope these pointers were helpful! As a small business owner, it can be hard to make time for market research - so keep in mind this doesn’t always have to be a formalized process.
You can do market research while on sales calls, while making small talk with customers in your store, or even while responding to inquiries or questions about your products. The best market research is done spontaneously “in the wild” - meaning that you are organically getting to know your audience without formally “interviewing” them. :)
Got questions? Feedback? I’d love to hear from you!
If you’re interested in working on your brand, you can learn more about what I do here.
If you have questions or would like to chat - shoot me an email at cindy@thehustlingheart.com
Cheers,