Market Research

What is Market Research?

Market research is a search for facts that will prove or disprove your assumptions about your market. It a process that will help you avoid risk, the hallmark of a successful enterprise, but can also burst bubbles if you find that a cherished idea isn't likely to work. Don't be discouraged: for every idea that doesn't work, there are several that do.

This page explains the why, what and how of market research. Here are some tools that can help as well:

Guide to Market Research

Market Research Worksheet

SWOT Analysis Worksheet

What is Test Marketing

The Importance of Market Testing

Why Bother with Market Research?

The main reason for doing research is to make sure that there are sufficient potential buyers of your product or service to make your venture financially successful. In addition your research will help you:

The information gathered is critical to making sound business decisions, for preparing a credible & workable business plan & for forecasting cash requirements.

How to do Market Research?

Here is a 10-step process that should help you to carry out the research you need to make sound business decisions:

  1. brainstorm ideas
  2. hypothesize
  3. identify the information you require
  4. research secondary sources
  5. check your hypotheses; return to step 1 if necessary
  6. research primary sources
  7. analyze and interpret the data
  8. check your hypotheses again; return to step 1 if necessary
  9. make a decision
  10. develop your marketing plan

What Information is Required?

There is so much information available in today's world that it can be overwhelming. Use the 10-step process to stay focussed. A good way to organize your research is to think of it like a funnel, starting with a large amount of general information, becoming more focussed then down to specifics related to your idea.

The information you require can be further divided between three categories:
1. Industry (Community)
2. Customers
3. Competitors

Here is a list of some of the information to look for:

General:

Focussed:

Specific:

Where to Obtain Information

Researchers separate sources of information into two categories: Secondary Sources and Primary Sources.

Secondary Sources

Information that is gathered for general purposes, such as that compiled by Statistics Canada, or for a project other than yours, is secondary source of information.  There is a huge amount of information available from secondary sources; the challenge for the market researcher is in identifying what information is relevant to the project and where it can be found.

In most cases business information can be gathered at no charge. Most published information can be found in these locations:

Primary Sources

Primary sources of information are sources that you use to generate data specifically for your business plan, focussing on your products or services, and their features and benefits.

Tips for Market Research