14 Tips to Carry Out Product Market Research

Product Market Research: Conducting market research is crucial if you’re planning on launching a new product or service.

For starters, you’ll need to learn about your likely customers.

Ensure there’s demand for your product or service, and figure out how to appeal to consumers.

Additionally, study your industry at large, and figure out how to stand out from the competition.

Finally, since launching a product or service is a risky endeavor.

Try to anticipate challenges, and use your research to devise ways to tackle any problems that arise.

Before launching your product or service, offer trials, demos, and other promotions to influencers to build hype.

For instance, send your new self-cleaning coffee maker to people with major Instagram followings so they’ll promote your product.

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Product Market Research
Product Market Research: https://businessmarketingengine.com

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Product Market Research:

1. Gather demographic information about your consumer base.

Learn about your likely audience’s age, location, gender, income level, and other details.
Gather data from reliable sources.
Such as government agencies, universities, industry organizations, and trade publications.

For instance, you can find plenty of useful demographic information on your government’s census website.

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Product Market Research:

  • Demographic information can help you figure out who your consumer base is and how to appeal to them.
  • If you want to open a coffee shop, for example, researching prospective locations’ median income and foot traffic can help you choose the right spot for your business.

Product Market Research:

2. Design surveys to learn about consumers’ needs.

Study how consumers buy products or services similar to your own.
And what factors go into their decision-making process.
Keep your surveys short, simple, and straightforward.
If possible, offer an incentive for completing the survey.

Such as a coupon for your product or service.

Product Market Research:

  • Good survey questions include “When choosing which product to buy, which is more important: price or quality,” and “Rank the following list of product features in order of importance, where 1 is most important and 5 is least important.”
  • You can use an inexpensive survey hosting website to conduct the survey, hire a market research firm, or administer it yourself.
  • If you choose to administer it yourself, you can post it on your social media pages. If you already operate an existing business, conduct the survey through its social media accounts and mailing lists.

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Product Market Research:

3. Find out what kind of messaging resonates with your audience.

Investigate where and how you should advertise your product or service.

You’ll need to learn details like the websites your target customer browses.

And whether your marketing materials should appeal to logic or emotion.

Either ask potential customers directly through surveys or look online for published market research.

Product Market Research:

  • Try searching online for university research studies and trade publications on marketing trends related to your product or service.
  • Suppose you’re a pet groomer and are launching a new boarding service.
  • You’d want to place your ads at strategic spots like pet-related websites or a billboard that overlooks a dog park.
  • Your ads also need to convince your audience that your product or service is worth their trust and money.
  • To resonate with your consumer base.
  • For instance, your pet boarding ads need to showcase expertise, reliability, and safe, clean facilities.

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    Product Market Research:

4. Conduct focus groups and trials to refine your product or service.

Recruit participants to test your product or service at a focus group or on a trial basis at their home.

Have them offer feedback on their experiences, and use that information to make any necessary improvements.

  • Testing your product or service can help you prevent hiccups when you actually launch it.
  • You can hire an outside party to conduct focus groups.
  • Or recruit participants through social media or your business’s network, if you already operate one.

    Product Market Research:

5. Research businesses competing for your target customers.

 Find out which other businesses sell products or services similar to your own.
Figure out how saturated your market is and how many options consumers have at their disposal.

Use that information to decide whether there’s enough demand for you to enter the market.

  • For instance, if you’re opening a hair salon and there are already 4 salons in a neighborhood.
  • It may be hard for you to be competitive in that location.

You should also look for ways to set yourself apart from the competition.

For example, if you’re opening a salon, you could offer a service.

Such as waxing or nail art, that’s not available at a neighboring salon.

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Product Market Research:

6. Investigate pricing and profit margins in your industry.

Look into price ranges for products or services of comparable quality as your own.

Accounting for parts, supplies, labour, and other costs, make sure you can price your product or service competitively and still make a profit.

  • For example, suppose you make jewelry and want to sell it online.
  • If parts for a piece of jewelry cost $15, you spent 4 hours making it, and you set your hourly wage at $15, the item’s price needs to be at least $75 ($15 times 4 hours is $60, plus $15 for parts).
  • If similar products are significantly less expensive, you could find ways to make your parts cheaper, such as buying in bulk. You could also market your work as exceptional or unique (perhaps your jewelry is made of sea glass from the Amalfi coast), or settle for a lower wage or profit margin.

Product Market Research:

7. Study your competitors’ brands to differentiate your business.

Review your competitors’ branding, and look for ways you can stand out from the crowd.

Establish who your business is, what promises you’re making to consumers.

And how you’re different from other brands.

  • Suppose you want to open a brewery.
  • To set your business apart, you could include a pub and bottle shop that sells a wide variety of beer and wine. While all the neighboring breweries just offer tours and tastings.
  • You could market your brand as a destination that offers something consumers can’t find elsewhere.
  • A company’s brand tells a consumer base who it is and what it offers.
  • A branding strategy communicates that identity through marketing materials, from hashtags to billboards.

Product Market Research:

8. Identify your industry’s key performance indicators.

You’ll need measurable, objective standards in order to track your business’s progress.

These standards are called key performance indicators, and they vary by industry.

Learn about how businesses in your industry measure their success by tracking factors.

Such as unique website clicks, profit margins, cost of goods sold, and customer retention rates.

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Product Market Research:

  • For example, a restaurant’s beer, wine, and spirits cost should be about 20% of its beverage sales ($20 of product should generate $100 in sales).
  • If your bistro’s alcohol costs are 29%, you’ll need to take steps to improve your performance, such as adjusting your pricing or conducting thorough inventory checks.
  • Search online, check trade publications, or talk to an experienced business owner in your network about your industry’s specific performance measurements.

Product Market Research:

9. Evaluate the reliability of your suppliers and distributors.

Identify where you’ll source any parts or supplies you’ll need and how you’ll deliver your product or service to consumers.

Make sure you’ll have a consistent supply chain, and try to anticipate any problems that could arise.

Come up with back-up plans ahead of time in case you need to deal with unforeseen supply chain issues.

  • Suppose you’re launching a new hot sauce and your recipe depends on a specific dried chili pepper.
  • You’ll need to know where to source that specialty product, where you can get it if your primary source falls through, how long it takes to order and receive it, the pepper’s shelf life, and how you’ll store back stock.

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Product Market Research:

10. Look up the laws and regulations related to your business.

Inevitably, your business will need to comply with one regulation or another.

So familiarize yourself with all laws that govern your industry.

Additionally, use your research to create contingency plans in the event you run into a compliance issue.

  • For example, your hot sauce could get recalled due to faulty packaging, or your pub could fail a health inspection.
  • Knowing packaging standards or health codes in advance can help you prevent issues and promptly resolve any accidents that happen along the way.

Product Market Research:

11. Create a list of outside forces and events that could affect your industry.

Thinking about what could go wrong isn’t fun, but it’s important to be realistic about risk.

From weather and natural disasters to economic downturn.

Research the likelihood of forces beyond your control that could threaten your business.

Do your best to create strategies to minimize your risk and respond to any outside threats.

  • For example, tense political conditions in the country where your hot sauce’s chili peppers grow could threaten your production.
  • Say your state’s legislature has been debating a bill that would raise taxes on the product you’re launching. Consider how that would affect your bottom line and whether you could afford to stay in business if it passed.

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Product Market Research:

12. More Tips

  • Search online for helpful local or national government resources for small business owners.
  • For example, in the U.S., visit https://www.sba.gov/business-guide/plan-your-business or, if you live in Canada, check out https://canadabusiness.ca/business-planning/market-research-and-statistics.
  • Your state, province, or national small business administration may also offer free services to help you learn about your consumer base, understand your industry, and minimize your risk.

Product Market Research:

13. Determine Research Design

A research design is your plan of attack for how you will answer the question in step one. You need to select the research method that you are going to use for data collection. A research method can include any one of the following processes.

  • Survey
  • Focus Group
  • Interview
  • Observation
  • Experimentation
  • Field Trials

Identify how many individuals will make up the sample population for your research. A sample population is a percentage of the larger target market audience that your product targets. Formulate a plan for contacting these individuals and the manner in which you will conduct your research. Options for doing research includes phone calls, emails, in-person questioning, postal mail surveys or internet contact. The option you go with depends on the information you are collecting.

Once you have all of the necessary footwork to your research design complete, you need to determine what classification of research you will implement. There are three research classifications that you need to consider.

Product Market Research:

14. Communicate Results

Compile all of your research information into a report or presentation that will be used to determine your product entry strategy when you are ready to put the product on the market. Make sure you include the original research objective and the problem that you identified at the beginning of the research process. Present your findings to your product and development team and then make a game plan for entering the product market.

A market research plan for your product is one aspect of determining where product placement should occur. It is not the only deciding factor, yet it might be the most essential. It gives you an insight into how your customers will welcome the new product or service. That alone helps to determine whether your product will succeed or fail.

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