{"id":742,"date":"2019-06-12T20:29:36","date_gmt":"2019-06-12T14:59:36","guid":{"rendered":"https:\/\/www.hestabit.com\/blog\/?p=742"},"modified":"2021-10-14T13:21:48","modified_gmt":"2021-10-14T07:51:48","slug":"the-first-leg-of-a-startup-journey-market-investigation-and-analysis","status":"publish","type":"post","link":"https:\/\/www.hestabit.com\/blog\/the-first-leg-of-a-startup-journey-market-investigation-and-analysis\/","title":{"rendered":"Market Investigation And Analysis: The First Leg Of A Startup Journey"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">Every startup story begins with the idea of persuasion. It\u2019s about how smartly you carry out your Market Investigation. The success of a startup story is never accidental, and it\u2019s based on the initial analysis, market segmentation, and competitive analysis. \u00a0\u00a0<\/span><\/p>\n<blockquote><p><i><span style=\"font-weight: 400;\">\u201cWhen you find an idea that you just can\u2019t stop thinking about, that\u2019s probably a good one to pursue\u201d.<\/span><\/i><span style=\"font-weight: 400;\"> &#8211; Josh James <\/span><\/p><\/blockquote>\n<p><span style=\"font-weight: 400;\">It\u2019s about understanding \u2018Product\/Market Fit\u2019, which Marc Andreessen defined as<\/span><i><span style=\"font-weight: 400;\"> \u201cbeing in a good market with a product that can satisfy that market\u201d.<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400;\">If you are an entrepreneur, then a \u2018Good Market\u2019 for you is the one that has a problem, which your product can solve. To understand the nature of the problem and see whether your product can resolve it, you need to investigate the market segment you want to jump into. <\/span><\/p>\n<h3><span style=\"font-weight: 400;\"><strong>You need to study your market\u2019s demography and analyze consumers\u2019 behavior. You need to learn about the existing solutions and the reason for their failure.<\/strong> \u00a0<\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Not everything about startups is restricted to passion. It\u2019s also about making informed decisions on the innovation quotient, growth, relevancy, covering the following 3 Ps: <\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><b>Product<\/b><span style=\"font-weight: 400;\">\u2014Building a product which isn\u2019t run-of-the-mill and is relevant to the needs of consumers. Focusing on functionality, usability, and user experience. <\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Price<\/b><span style=\"font-weight: 400;\">\u2014 Learning about the acceptable profit margins, competitor\u2019s prices, customer\u2019s spending capacity, and set your price based on your learnings. <\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Promotion<\/b><span style=\"font-weight: 400;\">\u2014 Preparing a roadmap to tap each market segment (Teens, Families, Students, Professionals, etc.), within the space of advertising, social network, and branding.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">The <a href=\"https:\/\/www.hestabit.com\/blog\/tips-to-market-your-business-without-a-product\/\">market<\/a> is a fluctuating entity and always has surprises in store. Investigating it can help you offset those surprises. By having your finger on the market\u2019s pulse, you can easily adjust to new regulations and technological shifts.<\/span><\/p>\n<p><strong>Market research can help you:<\/strong><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Prepare a plan to tackle economic shifts <\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Understand users\u2019 perception and preferences <\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Monitor the competition in your market<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Curtail risks in your business decisions<\/span><\/li>\n<\/ul>\n<h2>The ideal time to conduct a market investigation?<\/h2>\n<p><span style=\"font-weight: 400;\">To prepare a bankable launch pad for your startup, you need to invest in Market analysis during the planning phase. The resulting data can help you: <\/span><\/p>\n<ul>\n<li><span style=\"font-weight: 400;\">Determine the sales potential of your products and services<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Identify the demographic that is best suited to you<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Zero in on an appropriate business location<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Set an optimum price for your products and services<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\"><a href=\"https:\/\/www.hestabit.com\/blog\/the-first-leg-of-a-startup-journey-market-investigation-and-analysis\/\">Market analysis<\/a> is not just restricted to starting new businesses, and it is equally relevant for the existing ones. There are situations or goals that warrant market analysis even for established businesses. Some of them include: \u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Business expansion<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Redesigning your social media campaigns<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Repositioning your brand<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Introducing new lines of products or services<\/span><\/li>\n<\/ul>\n<h2><strong>The right approach to conduct a market investigation?<\/strong><\/h2>\n<p><span style=\"font-weight: 400;\">You can\u2019t have vaguely defined goals before commencing market research. So be clear with your goals and concertize your Whats and Whys. \u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The next step is to zero in on strategies and techniques to gather data. The process can be broken down into primary and secondary level research. <\/span><\/p>\n<h2><b>Primary Research<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Primary research focuses on collecting information through surveys, observations, or experimentation. Following set of questions can be addressed in the initial stages of research: <\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Who are your customers and how can you reach them?<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">What are your customers\u2019 expectations? <\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Are there any factors that impact your customers\u2019 decisions?.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">What should be the pricing of your products and services?<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Who are your competitors, and what are their operating styles, their strengths, and weaknesses? \u00a0<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">Although primary research takes a lot of time and effort and can be expensive if you hire an agency for carrying it out, you can target specific groups and markets based. You can tailor your research instruments to get specific answers. <\/span><\/p>\n<h3><strong>An old school way to carry out primary research is to conduct Surveys. You can target specific groups or markets that are large enough to be statistically valid. <\/strong><\/h3>\n<p><span style=\"font-weight: 400;\">By smartly preparing a questionnaire, you can identify customer segments, assess their characteristics, gauge their awareness about the business you are in, or track changes in their attitudes and opinions. \u00a0<\/span><\/p>\n<h2><b>Surveys can be conducted: \u00a0<\/b><\/h2>\n<h4><b>1. Over a phone call<\/b><\/h4>\n<p><span style=\"font-weight: 400;\">It is a cost-effective method, but at times it might be difficult to reach participants via this medium. People give spontaneous responses which make their accuracy questionable. Also, people might see it as an interference into their privacy. \u00a0<\/span><\/p>\n<h4>2. By emailing<\/h4>\n<p><span style=\"font-weight: 400;\">It is a more productive method as people can take their time and answer more accurately. Though you might need to send some reminder emails too. <\/span><\/p>\n<h4>3. In person<\/h4>\n<p><span style=\"font-weight: 400;\">It requires some field work to interview potential customers personally. You can go beyond your questionnaire based on the response and can change the focus of the survey on the stop. The information obtained is a lot more believable. Though recruiting participants for carrying out interviews can be a challenge. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">To obtain actionable insights from a customer segment, the questionnaire has to be designed intelligently. <\/span><\/p>\n<h2>Certain things to keep in mind while preparing one:<\/h2>\n<h4><b>1. Short and simple always works<\/b><\/h4>\n<p><span style=\"font-weight: 400;\">Keep your questionnaire short if you don\u2019t want to kill the enthusiasm of your customers. It&#8217;s your goal-setting is meticulous, then you can always avoid irrelevant questions. <\/span><\/p>\n<h4><b>2. Be clever while using open-ended questions <\/b><\/h4>\n<p><span style=\"font-weight: 400;\">Surveys work well when there are more closed-ended questions that can be answered with a simple Yes or No. But you would want your customers to answer in a free-flowing manner as well, won\u2019t you? So you can put a few some open-ended questions but arrange them cleverly. <\/span><\/p>\n<h4><b>3. Don\u2019t use leading questions, or avoid them as much as you can<\/b><\/h4>\n<p><span style=\"font-weight: 400;\">A leading question is the one which itself suggests an answer to the customer. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">For example, You like the ambiance of the restaurant X, don&#8217;t you?<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Such questions can compel a customer to answer in a fabricated manner. So it\u2019s better you avoid asking them. \u00a0<\/span><\/p>\n<h4><b>4. Use response scales<\/b><\/h4>\n<p><span style=\"font-weight: 400;\">Using the response scale, you can quantify a customer\u2019s level of agreement or disagreement with a statement. For example, you can ask customers to rate their experience of using a product similar to yours, on a scale of one to five.<\/span><\/p>\n<h4><b>5. Make your questionnaire visually appealing and creative<\/b><\/h4>\n<p><span style=\"font-weight: 400;\">Keep the basics right, as the font style and size. If you are using colored text, make sure that the screen is properly contrasted with the text. Most of your customers might not be avid readers. So don\u2019t use long paras. <\/span><\/p>\n<h3><strong>Besides surveys, another approach is to conduct moderated group interviews, aka Focus Groups. You can understand a customer\u2019s behavior better by such interactions. <\/strong><\/h3>\n<p><span style=\"font-weight: 400;\">You can explore your <a href=\"https:\/\/www.hestabit.com\/blog\/best-ways-to-improve-customer-retention\/\">customers<\/a>, and figure out trigger points, and perceive situations in which they might avail your product.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">On the contrary, you can understand why customers are inclined toward sources that are providing services similar to yours. <\/span><\/p>\n<h2><b>Secondary Research<\/b><\/h2>\n<p><span style=\"font-weight: 400;\">Secondary research is less targeted than the primary one. It focuses on the larger picture, like macroeconomics. <\/span><\/p>\n<p><span style=\"font-weight: 400;\">Some of the questions that can be addressed through secondary research include:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">What is the overall economic situation, Internationally, Nationally, Provincially, or Locally? Is it changing? <\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">What are the disruptions your industry is currently facing? <\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Are the consumer preferences changing or any technological shifts going on? <\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">What is the state of the labor market?<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Are there enough people having the skills you require? <\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">There are so many sources that can provide you accurate stats and analytics, to get all your answers pertaining to secondary research. For example: <\/span><\/p>\n<h4><b>1. Labour And Employment Data<\/b><\/h4>\n<p><span style=\"font-weight: 400;\">Statistics on the labor force, employment rate, and income levels in your market segment. You can refer to the data provided by \u2018<\/span><a href=\"http:\/\/www.oecd.org\/\"><span style=\"font-weight: 400;\">Organization For Economic Co-operation And Development<\/span><\/a><span style=\"font-weight: 400;\">\u2019 or \u2018<\/span><a href=\"https:\/\/www.ilo.org\/global\/lang--en\/index.htm\"><span style=\"font-weight: 400;\">International Labour Organization<\/span><\/a><span style=\"font-weight: 400;\">\u2019. <\/span><\/p>\n<h4><b>2. Industry Specific Data <\/b><\/h4>\n<p><span style=\"font-weight: 400;\">Statistics to understand your industry better, and study the latest trends that could impact your business. In this regard, you can refer to the insights provided by <\/span><a href=\"https:\/\/www.statista.com\/\"><span style=\"font-weight: 400;\">Statista<\/span><\/a><span style=\"font-weight: 400;\">. <\/span><\/p>\n<h4><b>3. Your Country\u2019s Economy<\/b><\/h4>\n<p><span style=\"font-weight: 400;\">Learning about the indicators, that reflect your country\u2019s overall economic health. You can go through the data provided by industry associations and government departments at various levels.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">It\u2019s important to shape your idea, but it\u2019s better to shape it using a method, a strategy. After Market analysis, the next steps are <a href=\"https:\/\/www.hestabit.com\/blog\/customer-segmentation-types\/\">customer segmentation<\/a> and <a href=\"https:\/\/www.hestabit.com\/blog\/how-to-do-competitor-analysis-for-startups\/\">competitive analysis<\/a>. Do give them a read.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Every startup story begins with the idea of persuasion. It\u2019s about how smartly you carry out your Market Investigation. The success of a startup story is never accidental, and it\u2019s based on the initial analysis, market segmentation, and competitive analysis. \u00a0\u00a0 \u201cWhen you find an idea that you just can\u2019t stop thinking about, that\u2019s probably a good one to pursue\u201d. &#8211; Josh James It\u2019s about understanding \u2018Product\/Market Fit\u2019, which Marc Andreessen defined as \u201cbeing in a good market with a product that can satisfy that market\u201d. If you are an entrepreneur, then a \u2018Good Market\u2019 for you is the one that has a problem, which your product can solve. To understand the nature of the problem and see whether your product can resolve it, you need to investigate the market segment you want to jump into. You need to study your market\u2019s demography and analyze consumers\u2019 behavior. You need to learn about the existing solutions and the reason for their failure. \u00a0 Not everything about startups is restricted to passion. It\u2019s also about making informed decisions on the innovation quotient, growth, relevancy, covering the following 3 Ps: Product\u2014Building a product which isn\u2019t run-of-the-mill and is relevant to the needs of<a href=\"https:\/\/www.hestabit.com\/blog\/the-first-leg-of-a-startup-journey-market-investigation-and-analysis\/\" class=\"more_link more_link_dots\"> &hellip; <\/a><\/p>\n","protected":false},"author":3,"featured_media":1281,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[404,403],"tags":[411,410,405,412],"yst_prominent_words":[366,362,352,167,178,357,360,365,361,368,356,355,194,359,358,364,353,387,363,388],"class_list":["post-742","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-competitive-analysis","category-market-analysis","tag-analysis","tag-market","tag-market-analysis","tag-market-investigation","post_format-post-format-gallery"],"_links":{"self":[{"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/posts\/742"}],"collection":[{"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/comments?post=742"}],"version-history":[{"count":10,"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/posts\/742\/revisions"}],"predecessor-version":[{"id":2614,"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/posts\/742\/revisions\/2614"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/media\/1281"}],"wp:attachment":[{"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/media?parent=742"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/categories?post=742"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/tags?post=742"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.hestabit.com\/blog\/wp-json\/wp\/v2\/yst_prominent_words?post=742"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}