Q: How do I obtain and use market research?
A: Market research is defined as systematic gathering of information regarding customers, potential customers and competitors to use in planning for and operating a business. The research can be either primary (direct contact with customers) or secondary (using statistical information from an outside source such as U.S. Census data). According to Wikipedia “Market research began to be conceptualized and put into formal practice during the 1920s, as an offshoot of the advertising boom of the Golden Age of radio in the United States. Advertisers began to realize the significance of demographics revealed by sponsorship of different radio programs.” Market data is increasingly collected through purchases made using the internet or using a retail store rewards card or even the searches done online using social media.
To be successful in business you need to understand what your customers want and need, what price they are willing to pay and what their buying habits are. You need to understand what the competition is doing, what direction are they moving and how they are reaching customers. And you need to understand your industry, what are the business trends, what opportunities and threats are looming on the horizon. Market research information is available from a variety of sources. Government agencies, such as the U.S. Census Bureau http://www.census.gov/, can provide a wealth of information about economic conditions, trends, disposable income and the regulatory environment. Industry associations, business periodicals, academic institutions and other businesses collect and analyze research data about business trends. Much of this information is available on the internet or through the local library or by purchasing industry reports. The Small Business Development Center network has access to a wealth of market research data that can be provided to their clients, usually at no cost. This market research can be accessed through www.Bizcenter.org.
Market research is used in business planning to determine the feasibility of a business idea or a business location. It’s used to show investors and lenders that financial projections are reasonable. It’s also used to develop pricing strategy and to build advertising campaigns that reach potential customers. Market research is used to identify new opportunities and reduce business risks. Without market research it’s difficult to identify trends or potential problems in your industry.
Researching your market is an ongoing process in successful businesses. It can be as simple as asking customers how they found your business or what other products and services they would be interested in purchasing from you. It can be as complex as creating a full scale survey and analyzing the data collected using statistical analysis.
The SBDC is a partnership of the U.S. Small Business Administration, the Oregon Small Business Development Center Network, the Oregon Business Development Department and Southwestern Oregon Community College. Arlene M. Soto has been the Director of the Southwestern Small Business Development Center since July 2007. To ask a question call 541-888-7001, e-mail firstname.lastname@example.org, or write 1988 Newmark Ave., Coos Bay, OR 97420. Additional help is available at the OSBDCN Web page www.bizcenter.org.