Plan your business
Market research and competitive analysis
Market research is a great way to help your business acquire (new) customers. Competitive analysis may help you make your business distinguishable from your competitors. Combine them for your business to gain a competitive advantage.
- Use market research to acquire (new) customers
- Use competitive analysis to gain a competitive advantage in a specific market
Use market research to acquire (new) customers
Market research combines the behavior of consumers and economic trends to confirm and/or improve your business ideas and practices.
You must understand your clients from the moment you start doing business with them. Market research will reduce risks and prevent you from making unnecessary mistakes.
To better understand opportunities and/or limitations for acquiring more customers, you need to gather demographic information, such as population data based on age, wealth, family, interests or any other subject that may be relevant to your business.
To better understand the market, you need to answer the following questions.
- Demand: Is there a desire for your product(s) or service(s)?
- Market size: How many people are interested in what your business has to offer?
- Economic indicator: What is the income range and employment rate?
- Location: Where do your potential customers live and can you reach them?
- Market saturation: How many similar options are there for your potential consumers?
- Pricing: How much are your potential customers already paying for alternative goods or services?
It is in your interest to keep up with the latest small business trends. Having a good idea of your market share is necessary, as it will impact your profit.
You can do market research by using existing available sources or gathering the information relevant to your business by approaching consumers yourself.
Available sources of information can save you time and energy but might not be specific to the consumers you wish to target. Use this information when answering general and quantified questions, for example, industry-related trends, demographics and consumer income.
You can identify the specific group of consumers you wish to target (target group) by directly approaching consumers with a question relevant to your business. Take note that this method may be time-consuming and expensive. Use it to answer specific questions about your business and/or clients. For example, how do consumers feel about or react when being confronted with your logo, how can your business improve its customer’s shopping experience, and which alternatives to your business may your customers choose?
Below you will find a few methods you can use for direct market research:
- Focus groups
- Interviews about qualitative research
Use competitive analysis to gain a competitive advantage in a specific market
Competitive analysis helps you gain insight into your competitors’ methods to target your (potential) clients. It is the key to defining your competitive advantage to generate a sustainable profit.
The competitive analysis should identify your competitors based on their products or services and market segment. Assess the following characteristics of the competitive landscape:
- Market share
- Your strengths and weaknesses
- Window of opportunity to enter the market
- The importance of your target group to your competition
- Any barrier that hinders you to access a specific market
- Indirect or secondary competitors who may affect your success
Various industries may be competing in your targeted market. Therefore, your competitive analysis must differentiate each specific sector. In this regard, it would be advisable that you contact IDEA to receive information about certified business consultants.
Contact IDEA for information on certified consultants.Scroll To Top