The importance of small business market research

Many small business owners feel that if they have a great product or service then all they need to do is an open their business or website and wait for their customers to show up. Sadly, past experience has shown that this is rarely an effective strategy. Savvy small business owners understand the crucial importance of marketing and basing that marketing on effective market research. If you fail to take the time and make the effort to do effective market research the chances are high that you will soon find yourself closing the doors of your small business. The bottom line is that market research will be the tool that allows you to develop an effective and successful marketing plan. Here is what you need to know about the importance of small business market research-

- Market research will show you who your target market is-All to often small business owners think that they can be everything to everyone. This is simply not true no matter the size of your business. You should never assume that everyone will want your product or service. However, there will be a certain segment of the market that will be more likely to purchase from you .You need to make sure that you are using market research to determine just who those people are. In order to correctly position your product or service you will need to know the income level, lifestyle choices, and even how your target market likes to shop. Once you do you can then make sure that your marketing is as effective as possible.
- Market research will show you where your target market is-It is not enough find out who your target market is. You will also need to determine where they are and how to best reach them. Once you know where your target market is you can then determine what marketing methods to use. For example-Will your target market be looking to shop at a physical location or will they primarily do their shopping online? Does your target market access social media sites or will you need to send them direct mail pieces? Determining where your target market is not only important in deciding how to market to them it will also save you money. Small businesses can rarely afford to access every type of marketing and those that try to usually end up losing money.
- Market research will show you what you are doing right and what needs to be changed in your small business-Successful small business owners will have taken the time to test their product or service and gain valuable information through market research. If you take the time to use market research in this manner you will be able to see what type of reaction you can expect from your target market. It will also give you insight as to whether or not you should make changes to your product before you release it. This also offers your target market a sneak peek what you can offer them and helps to build excitement for the full release of your product or service.
- Market research will show you how you can save money-Every business owner no matter how big the size of their business is looking to save money. Market research can help you to do that. Marketing is expensive and by using the appropriate market research techniques you can determine the best ways to use your marketing budget. The focus should not be on spending the largest amount you can on marketing but rather making sure that every marketing dollar that you do spend has the highest possible return. Once you have the right amount of market research in hand you can make this happen.