Market Research Statistics can provide you with valuable information that can greatly influence your small business. By understanding your market and the demographics of your business area you are better prepared to determine your target market and develop a strategic marketing strategy to attract them by fulfilling their wants or needs. Below are various websites you can use to determine information such as demographics.
Census.gov The Census website offers statistics on population, businesses, economy and more.
RealEstate.Yahoo.com– Get a profile and statistics on your neighborhood.
BestPlaces.net– discover interesting information and statistics about your city. Offers information on population, cost of living, education, housing and more.
FedStats.gov– This website offers information on a wide range of topics.
Small Business Statistics
On this website on the lower right side you will find the small business survival index for the last 5 years. Basically this index shows which states they think are the best to start a small business in and which are the worst. You can also see how they rated tax systems for small businesses for each state. In 2008 South Dakota was the best and the District of Columbia was the worst.
State Profiles for Small Businesses– The SBA offers research on each state’s ” number of firms, demographics of business ownership, small business income, banking, business turnover, industry composition, and employment gains and losses by size of business.”
Entrepreneur.com Business Statistics– This website has very interesting information about small businesses and their growth. It contains statistics on how small businesses advertise as well as statistics on minority and women owned businesses.
SBA Frequently Asked Questions– General information and statistics about small businesses.
Conducting Market Research Interviews provides you with the opportunity to meet individually with your target market. Instead of conducting a group interview such as a focus group you can also conduct individual interviews. In an individual interview the researcher asks the targeted buyer questions similar to those in a focus group. The researcher asks about the interviewees likes, dislikes, problems and opinions of a product or service. You can choose to conduct the individual interview in person or over the phone. One disadvantage of individual interviews over focus groups is that the interviewees don’t get to interact with one another. For example in a focus group, one person may say something that causes a reaction in another and suddenly bursts of ideas start sprouting. In individual interviews there isn’t that same kind of interaction. However an advantage of individual interviews is that you get to talk to your target buyer one-on-one and get more information about that individual and their specific thoughts and opinions.
Your goal in conducting market research focus groups is to learn as much as you can about your target market. Market research focus groups can give you a glimpse in the minds of your target market by revealing their thoughts, opinions, and feelings about a certain product, service or topic. Though conducting focus groups is a useful method of market research it should not be used as your sole method of market research.
What can Focus Groups be used for?
- obtain opinions and concerns about a product or service
- test out a new product
- improve an existing product or service
- develop ideas for new products or services
- learn about your target market’s wants, needs, concerns and motivation for buying
- generating ideas to solve a problem
What is a Focus Group?
A focus group is a group of anonymous people (fitting the profile of your target market) whom gather around to talk in debt about a certain product, service, or topic. The members of the focus group are chosen based on certain characteristics such as age, income, race and demographic location. A focus group can be made up of 6-15 people. In the focus group participants are asked about likes, dislikes, problems and opinions on a product or service. Each focus group should have a moderator. The moderator will be given a discussion guide sheet to guide him/ her along the session. The moderator is there to ask questions, encourage everyone to speak up but make sure they are not all talking at the same time. The participants of the focus group should be doing most of the talking, not the moderator. The participants should be able to voice their concerns, thoughts and opinions freely. A focus group can last 1-3 hours but no longer than that otherwise members may become restless.
Advantages of Market Research Focus Groups
- you can attain more in debt information about feelings, thoughts and concerns of your target market.
- Focus groups can provide a new perspective as well as new ideas for your product or service.
- This form of research is attained more quickly.
Disadvantages of Market Research Focus Groups
- Members may feel peer pressure to give certain answers or to go along with the group.
- The small size of the focus group may not be a good representation of the larger community.
- Can be expensive.
Costs of a focus group
Costs for a focus group meeting will vary. You can choose to hire a market research firm to conduct the focus group meeting for you. However if you are working with a budget you can decide to do it yourself. Of course participants will want to be compensated for their time anywhere from $20- $100 for each. Many focus groups also offer their participants free food or snacks.
New Trends with Focus Groups
A new trend with focus groups thanks to the Internet are online focus groups.There are benefits to conducting focus groups online such as lower costs. Instant messaging, screen sharing and webcams have made it possible to have a group discussions online.
What is Small Business Market Research?….and why do you need it?
Small Business Market Research is the gathering of information and tests about the market for your small business. Market Research can help you determine if there is enough demand for your product and service. Market Research is used to discover the needs and wants of your potential and current customers. It can also be used to perform a SWOT analysis and to analyze your 4 P’s of marketing.
There are two types of market research; primary market research and secondary market research. Primary market research is more useful since you get to ask specific questions where in secondary market research you get more general information. Before conducting small business market research you need to determine what specific information you want to find out.
Conducting Small Business Market Research
Primary market research– Primary Market Research is first hand information from customers and potential customers. Primary market research is more expensive and time consuming to perform than secondary market research, however the information it offers can be much more specific and valuable.
- Market Research Surveys– Surveys by phone, mail or in person are used to assess the potential success of a product or service. Surveys are a highly used method of small business market research.
- Market Research Focus Groups– A Focus Group is a group of people (usually 6-10) who gather around to talk about a particular product, service, problems they have and more. A focus group can help you gain valuable insight about potential customers, by discovering their likes, dislikes and problems.
- Market Research Individual Interviews– Instead of conducting a group interview (focus group) you can also conduct individual interviews.
Secondary market research– Information someone else has gathered.
- Reports/ Studies(University studies)
- Local Newspapers and business magazines -many local newspapers and business related magazines offer demographic data.
- Library– In the reference section of the library you will find financial data and statistics. Ask your local librarian for help, they will be happy to assist you in finding the information you need. In the library among the references you will find studies by the U.S Department of Commerce and the U.S. Census Bureau.
- Government Agencies– Your local Bureau of Census publishes the “County and City Data Book” with offers local demographic information. Many state and local offices provide demographic information of the local area.
- Market Research Statistics– There are many websites online that offer statistics for small business market research. Statistics such as Demographics can help you get a sense of population characteristics of your location.
- Trade associations– there is a trade association for just about any industry. There is usually a fee to join but it is an opportunity to network with other professionals in the industry. You will also have access to market research they conducted.
Market Research while Running your Business
Don’t think that once you start your small business, you don’t have to conduct any more market research. Your small business should always be evolving and adapting to the changing markets. Here are some market research techniques to use while running your small business.
- Keep a sales report– Find out what products are hot and what products are not. Certain products may sell more in certain months. Inventory tracking software can help you notice trends.
- Competition– Pay attention to your competition. See what changes they are making. Have they made any changes in recent months or years? Have their products changed? Did they start offering new services? Your competitors may be making changes as a result of the changing market needs.
- Customer Survey– Perform customer surveys to discover what are the customer’s likes and dislikes and how you can improve your business. Be sure not to force customers to fill out a survey. Be sure they know it is optional. You can have a customer suggestion box where customers write their suggestions and put it in the box. You can also find out where your customers are coming from by asking for their zip code when they are about to pay. You may discover that a large percentage of your customers come from a certain area.
- Keep a Caller ID– Find out where your customers are calling from. You may discover that a large concentration of your customers are in a certain area and it may not necessarily be in your area of business. You can then experiment with advertising in those areas.
Small Business Market Research can be an expensive and time consuming task depending on the methods of market research you choose however the information you obtain from it can be very valuable to your business. You can decide to hire a market research firm or do your own market research. If you decide to do it your self you can consider taking a Market Research Class in a local college. This class will help you attain some knowledge of using different market research techniques to effectively collect data.