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How to do a market study for your new business idea

Learning how to do a market study is a fundamental step when it comes to defining if your business idea will be successful or not.

Are you one of those who thinks that your business idea is unique? Are you convinced that never before, to anyone, had that great idea occurred to him? Or, that the market you want to reach, is an anxious and desperate space to have your products and services?

If so, it’s time for you to learn how to do a market study and validate those ideas you have in mind.

Why is it important to learn how to do a market study?

The fact that your product is not on the market or has never existed before does not mean that it will become a resounding success.

Before this can happen, and get to this wonderful conclusion, you must know if there really is any demand for your idea.

market studyAnd if it exists, define its size, because although there are ideas that are good enough, these may lack a market worth developing.

Learning how to do a market study helps you determine if the level of earnings, compared to the investments that must be made to develop your business idea, keeps the project viable.

However, many people avoid learning how to do a market study so they can get to hear your ideas. They panic that their “wonderful ideas” have no market, that they are not as good as they imagine … Continue reading: 5 Trends in digital marketing that have a future

Why do not people want to learn how to do a market study?

A market research is basically a tool that can provide you with relevant information about your product or service.

So, why do not people want to learn how to do market research for their product?

Analyzing the reasons for not using it, we find “great things” like thinking that our ideas are perfect, as we conceive them, or that an investigation can be expensive.

Worse yet, there are scenarios where we find entrepreneurs who do not find meaning in a study that confirms that their product is viable or simply wonderful.

And even less know all the costs and expenses that must be assumed when creating a company.

However, the reality is that learning how to do a market study, however simple, is a long-term investment for our project because by making the necessary adjustments that it indicates, we can avoid large losses of money in the future.

How to do a market study:

Then we will talk a little about what is a market research and then analyze the 3 most important pillars of this tool.

Definition:

What is a market research? It consists of a method that allows us to obtain information with which we can avoid or solve problems in our market.

When we carry out a good investigation we obtain important information about the market to which we are going to enter.

For example, you will know how to carry out a marketing plan, and above all how to differentiate ourselves, with our product, from the rest of the competitors.

market studyEven a good investigation can give us clues as to which geographical area to attack first, and which ones to postpone for the future.

Most likely, he is not an expert in this investigation; Like many aspects when it comes to learning how to start a business, you do not have to master 100%, but you do understand how it works, know who does it and how to interpret the results.

To start you can seek advice with professors from the university, with consultants or experts on the subject, as these can guide us in this research process and avoid making mistakes when it comes to finding the most important data.

Below are the three lines of information that we should obtain from market research:

Industry:

Learning how to do a market study is knowing that, regardless of what your business idea is, you will not be alone in the market. You will always have a possible competitor, suppliers, interested parties, customers, government, among others.

This is why, depending on the industry to which we come, we must understand the trends that move this, the growth rates and other important variables when entering that market.

There are important questions that we must solve:

What kind of technology is being used?

How easy are new competitors?

Are you attracting new customers?

Is the industry growing, falling or is it stable?

All this we must keep in mind since we will not want to enter a market or industry that is having negative growth levels.

Consumer:

All market research should begin with an analysis of our future clients. This to define an estimate of sales, either in units or money, that is realistic.

In order to do so, we must keep in mind three elements: the size of the market according to the industry, our share of the market and the respective consumption of that industry. How much do our customers spend on certain products or services?

market studySome accurate estimates should have variables such as per capital consumption, unemployment rate, population, average income, among other demographic characteristics that allow us to infer the behavior of our user.

It is extremely important not to make assumptions with a market share of more than 5%.

Competitors

After analyzing our customers and our future industry we will have some ideas about our competitors, and not only about the current ones, but also about the possible competitors that may be arriving at the market.

One of the objectives of learning how to make a valuable market study is to identify aspects such as the strategy and operations of the competition.

In this way, you will be able to find possible shortcomings and opportunities to differentiate yourself with a business opportunity, as well as identify which are the threats that may arise.

In conclusion, there are many sources where you can obtain information such as internet, articles, newspapers and specialized media.

However, it is in practice and in the day-to-day development of your business, where you will find the most important data to develop your business.

It does not matter that you are developing a cheap franchise or you are starting your business from scratch, learning how to do a market study is essential to succeed with your new project.

“Entrepbusiness” also recommended you to read this article for more information about marketing11 innovative marketing ideas for small businesses with tight budgets

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