Market research can provide information to help you make informed decisions and keep your business healthy and thriving. It can also be a requirement for a business loan or grant to make a case for your business.
Free resources are available from the Census Bureau, Small Business Administration and the library.
Booklist: Finding Your Target Market
To begin your market research, consider three main questions:
1. Who are my potential customers?
A solid understanding of your current or potential customers is essential if you want to direct your marketing efforts to those most likely to buy your products or services. Explore demographic information, consumer behavior and lifestyle interests, buying power and spending habits, and specific target markets.
Demographic information
Demographics are facts and figures about people or important details about a group of people, such as:
- The number of people in the group
- Ages, gender and location
- Earnings and what jobs held
- Education, marital status and ethnicity
Target markets
Target markets are groups of people who share common characteristics and are more likely to buy a specific product or service. These target markets are based on factors like age, gender, income, interests, behaviors, lifestyles and traits. Businesses identify target markets to tailor their marketing efforts.
2. Who are my competitors?
Assess the position of your business in relation to your competitors.
Identify your main competitors, review their business operations, analyze their weaknesses, strengths, pricing strategies, and so on. Who are their customers? What is their sales volume?
3. What is the state of my industry?
What is the size of the market for my product or service? Is this market shrinking or expanding? What is the market share of my competitors? What future trends are likely to affect my industry?
Review relevant trade journals and trade associations. Sometimes overlooked, they are key sources of industry information.