There are many businessmen and women who become alarmed when hearing that 80% of small businesses fail within the first five years of being started.
If your business is a start-up, then you know that a successful plan for business marketing has little to do with gut feeling. It is however based on sound market research. If you have already come to terms with this, then you will have a competitive advantage. Despite the fact that market research is crucial for understanding the competition, many startup ideas are focused on the business opportunities and creating successful products. If startup businesses spend more time on understanding competition on all levels: segment competition, product competition, technology competition, future competition – they will be better equipped at devising highly effective competitive action plans.
Below we will outline reasons as to why research is crucial for startups and customer development:
- Poor planning: One of the major reasons as to why research is crucial for startups is poor planning. This can compromise the unplanned financial management, unplanned business administration, and unplanned marketing efforts.
- Marketing yourself well: Instead of marketing your general profession, you should stay focused on your niche. For example, if you market yourself as a “Research Startup”, you are too general and not specific enough. Try marketing your idea as “On-demand Media Research for Publishers” or “DIY Market Research Platform for Small Businesses”.
- Plan well: Despite the fact that the planning process may seem time-consuming in the beginning, you will greatly benefit from this type of planning in the future. Your research should plan for details like when you need to hire professionals, when you need funding and even when you take on a partner or investor.
- Spend wisely: In the development stages of your business, you should not invest money on business cards, brochures and websites. Instead, research which schools have the best design, technology or engineering programs and develop an internship program to help with your website and development needs.
- Don’t promote yourself, promote your products: People who come to you will have a problem or they may need a specific type of product that addresses a need. If you have thoroughly researched your customers’ needs and can describe the solution you’ve created for them – you have hit the nail right on the head!
With the help of this checklist, you will be able to stay on track and avoid the dangers of those who could not make the shift to run a more successful business.