Things you should know about small business market research

Marketing research can be crucial to the success of your small business. Even more importantly is the type of market research that is done. This is because marketing efforts that are aimed at the wrong target market can be a waste of time and money. Ultimately this hinders a business's efforts to attract new customers. Market research can be used, in order to help prevent this and to evaluate current methods. Do not fall into the trap of many small business owners that assume marketing is to expensive or is not needed at this early stage of the business cycle.

Market research is defined as a series of objective methods that are used to collect and analyze various information about your target market, and your competition. Market research is also beneficial in that it can help a small business to decide best ways to advertise, how to gain an advantage over the competition, and how to place themselves in the marketplace.

It is important to understand that market research is an ongoing process. While there is no denying that it costs money to conduct market research, however,if it is used correctly and effectively, it can actually end up saving the company a great deal of money and help a small business to make the most profitable decisions. For example-You may want to send out a direct mailer to your target market. The cost of the mailer is estimated to be $500 dollars; if it brings you additional revenue of $5000 dollars then you have only spent 10% on marketing research costs. Market research can also help you to identify your success and make changes in your marketing strategies where necessary.

It is important to understand that there are different types of market research. While it can come in many different forms, typically they are divided into two groups. These two groups are-

Ad hoc market research is used primarily to focus on specific marketing problems. Most of the time it is used in the form of studies from a number of respondents. Ad hoc is considered to be very beneficial for small businesses and includes the following:
1. Product surveys-These surveys are designed to ask about the ease of use, the design, and any other information that helps businesses determine the potential success of their products. After gaining this information it is then used to make any necessary improvements, to the product.
2. Corporate image surveys-This type of survey can be a good way to determine whether you need to do any damage control, or how to tailor your image, to your target market. For example, if your target market is young adults and your respondents say your business has an old-fashioned or outdated image, you might then want to consider updating things.
3. Customer satisfaction surveys-This type of survey is also a good way of helping you see where you need to improve, and go beyond the product itself. It should focus more on the service, support, and helpfulness of employees.

Continuous market research generally involves surveys that interview the same people repeatedly. They can include:
1. Ad tracking-This monitors an advertisement's success. This way if the ad is not bringing in significant amounts of business, then it can be changed to become more appealing to your target market.
2. Consumer panels-This includes large numbers of people who provide information about their buying habits. This can be used to determine where your product or service is placing in the market.
3. Mystery shopping/testing-This is when an undercover shopper or customer tests the way business is run, then provides feedback.