Market research allows companies to test the viability of a new business idea or product. It usually takes place fairly early in the business development process and involves collecting data on customer preferences and broader industry trends. It can help new companies looking to enter the market, as well as existing companies looking to stay on top of industry trends.
What Are The Main Types Of Start-Up Market Research?
Broadly speaking, market research can fall into one of two main categories.
Primary Market Research
Primary market research includes any information you collect yourself, usually by engaging directly with your target audience. It takes into account your customer interactions and competitor profiles, It also includes any insight you gain from your current sales volumes, metrics, and customers.
This type of research is helpful when a start-up needs direct feedback from prospective clients. For example, if they want to know how they feel about a product, what their typical product spend might be, or how they perceive similar products that are already on the market.
The main advantage of primary market research is that it enables you to build your research around the questions that matter most to your business, and to get a better understanding of the competitive landscape. The downside of this type of research, however, is that it can be time-consuming and expensive.
Secondary Market Research
Secondary research, on the other hand, involves looking at data that has been already prepared by third parties. It takes into account reports from other companies, government organisations, and other industry players. Depending on your industry, it can also include case studies and broader market news.
This type of research is helpful when a start-up wants to get more insight into the industry as a whole. For example, if they want to understand which markets have growth potential, which competitors have the top-performing strategies, or whether recent economic trends are impacting businesses at an industry level.
The main advantage of secondary market research is that it comes from third party resources. This can save companies a considerable amount of time and money on in-house projects. It can also help them get more insight into any external factors that might impact product launch or business strategy.
What Is The Best Type Of Market Research For Start-Ups?
Your market research needs to reflect your overall goals and business plan. When deciding what type of research to do, you may want to consider the type of information you’re looking for. For example, are you looking for user feedback on your products, or are you trying to understand potential market growth? If you’re using the research to make important investment decisions, or to determine market entry strategies, then you may benefit from both types of research.
Final Thoughts
Market research can be a worthwhile investment for start-ups. It can give you the hard data you need to create viable products and strategies. It can also give you the insight you need to understand your consumers, your competitors, and your best options for market entry. And with these two types of market research you get the both of best worlds; an in-depth look into how prospective clients view your business, and a detailed understanding of current industry trends. For more information about market research for start-ups, visit the blog.
