Conducting Market Research... why this phrase is so intimidating...

Conducting market research. That statement in and of itself is intimidating, but why is it so intimidating? Maybe because many of us don't even really know what it means. Maybe because we have no idea where to start. Do we look at how many similar businesses are in the area?... How many people are there who will buy our product or service?... What is market research, what should I be looking for and what do I do with it if I can find it? To keep it simple, let's break research into 3 groups.

1. Target Customer - Where do the greatest # of my target customers live and work and what do they look like (demographics). Remember that target customers are not anyone who would buy your product or service but those who do buy similar products or services today or will have a need to buy your product or service in the near future.
2. Competitive - How many other businesses in my area fill the same need. Notice I wrote "fill the same need" not sell the same service. A need can be filled by someone selling a different service. Anything that could be chosen to replace or substitute your product or service is a competitor. For example, you want to open a health club in an area where there is an outdoor park or great mountains 15 minutes away...these other options for staying active are competition for your business.
3. Financial - What will starting and running the business by geographic area and type of location cost. What financial benefits could each option provide? A strip mall may cost a little more for space but provide instant exposure...or competition... A location a little bit off the beaten path may be cheaper but could require more marketing to create awareness.

Doing the research is never fun, but it is necessary to understand what you and your business are really getting into. Research at its core is just answers to questions. Come up with the questions you need answered to give your business the best chance of success, identify the type of people that you need to answer your questions and ask away.