Five Reasons To Do Market Research

Research DefinedThere are many reasons to conduct market research.  It is mainly completed on the basis of services and products that the company is offering.  Although the number of reasons are literally limitless from broad position projects to determining the best version of a logo, there are five main reasons: Read more of this post

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Market Research Helps Business Plans

Over the weekend I met someone whose son is opening up a new franchise in Florida.  In our discussion he had mentioned that although his son had a business plan, he felt his son needed a little additional research in his plan.  I told him that, unfortunately, this is a common situation.

In a slightly dated, but still relevant, 2009 press release, from Michigan CFO Associates, it stated that 90% of small business owners do not do anything to jump start their stagnant businesses.  Other findings from the research were:

  • 99% of businesses have no written plan for growth.
  • 98% of businesses fail by the 10th year.
  • 80% of businesses fail because of under-capitalization.
  • 23% of businesses price their goods or services correctly.

When developing or revising your business plans, there are several areas where market research can be used to improve your business plan.  The two main ares where research can best help your business plan is for competitive analysis and developing your target market.

  • Competitive Analysis:  I have written a number of times about understanding your competition.  By doing a comprehensive, independent look at your competition, you can develop a SWOT Analysis (Strengths, Weaknesses, Opportunities, Threats) for each of your competitors and yourself.  With this analysis, you can identify areas where your business model is better than theirs and areas where you may not want to compete against because their company has a competitive advantage.
  • Target Market Development:  The only thing that is more important about knowing your competition is knowing your target market.  You can do this in a number of ways.  Talking with your current and past customers are a great way to get to know them better.  This can be done by interviews or surveys.  During your discussions with your customers, be sure to identify why your customers buy you over your competition.  Also, get to know them from a segmentation aspect.  For example, if you are a B2C business, know who your best and typical customers are from a demographic perspective (martial status, age range, kids, household income).  On the other hand, if you are a B2B business, knowing the industries, employee count, revenue range and growth are the metrics you should be grouping your customers in.

How have you used market research to improve your business plan?

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.

Even In Down Markets, Businesses Need To Figure Out How To Grow

Believe it or not, businesses can grow in down markets!

This is especially true for small businesses.  However, many businesses are still in survival mode.

As the general population gets larger, the development of niches became more of a potential; especially with the recent trend of buying local.  However the “buy local” can actually be developed nationally and internationally.

Last week I had the opportunity to go to the launch party of Feelgoodz, a 100% recyclable and biodegradable flip flop, in Raleigh.  It was great to see the store and meet the owners.  However, after reflecting on the event, if someone had told me five years ago about a company being successful in this space, I would have thought they were crazy.  Here is a local company that is being successful by developing a niche.  However, their “local” niche ships worldwide.  Here is a prime example of how a small business is being successful by developing its own unique niche.

What are you doing to grow your business instead of just survive?

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.

How To Use Market Research To Improve Your Marketing

so what's all this new marketing stuffEverybody wants to improve their marketing efforts. Improved marketing and promotion leads to more customers and better retention of your current customers.

However, many businesses spend thousands of dollars every year on a variety of marketing tactics without a lot of success. This is mainly due to the lack of understanding how to marketing and advertising in an effective way. If these businesses a little research before they develop their marketing, their messaging would be more effective. Although each business is unique, a few basic market research strategies can help. Here are two:

Determine a concise target market

Before you start any business or marketing campaign, you need to learn about who is the intended target for the business or marketing campaign. This can be done through either primary or secondary research. Before launching a new product, service, or campaign, you need to know:

  1. Who wants or needs the product or service I am selling?
  2. How many potential consumers are out there?
  3. Where are my potential customers located?
  4. How much are my potential customers willing to spend?
  5. Why will they buy my product or service?

By identifying your target market, you will be able to evaluate the viability of your business, increase its visibility, and make the necessary changes to increase sales. By developing a target market you are less likely to waste your advertising dollars on promoting to the wrong group of customers.

Develop a database

It is surprising to me the number of businesses, large or small, that do not have and maintain a database. By developing and maintaining a database, a company can get a full understanding of their customers’ profile. By using your customer data more effectively, new products can be developed more efficiently and a more cost effective direct marketing campaign can be achieved.

Many businesses do not truly conduct market research. They probably see it as too difficult, too expensive, or not a perceived value. However, the value of doing it ahead of time can prevent a considerable waste of money on products and services that potential customers may not want and marketing campaigns that they may not respond to.

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.

Segmenting To Understand Your Customers

segmentation Businesses need to understand their customers.  Now I know this is not an Earth shattering concept.  However, a number of businesses do not know who their customers are. And, in turn, they do not understand how to attract their customers.  By segmenting your customers, you can learn more about them and how to attract them.

I tell my retail and restaurant clients and potential clients that “birds of a feather tend to buy together.”  But in order to grow your customer base, you need to get a good understanding of who your core customers are.  To do this, you need to understand not only the demographic components of who your customers are, but also the psychographic components of who your customers.  Here are examples of each.

Demographic Components:

  • Marital status
  • Age group
  • Children
  • Household size
  • Location of residence

Psychographic Components:

  • Types of magazines read
  • How news is received
  • Activities participate in
  • Types of vehicles driven

Once you are able to understand your core buyer in both demographic and psychographic components, then you are can start to develop strategies to find more similar potential customers.

How have you segmented your customers?

–J. Nolfo helps companies understand their market and customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your market and customer needs, email him at jnolfo@rhinomarketresearch.com.

Support Small Business

Small Business Saturday

I may be biased, but I like small businesses.  I like local businesses. 

But then again, I am one and my clients are the same. 

When you go on a trip, where do you eat and shop?  At Outback & the mall or at the local steak place and the local boutique?  Probably the local places, right?  So why is it different when you are at home?

Last Saturday, November 26 was Small Business Saturday.  This is the second year of the campaign.  It is the day after Black Friday when most people are shopping the Big Box Retailers and malls.  Although I love the premise, we need to support small business year-round.  Of all the businesses in the U.S., 98% are small businesses (less than 100 employees) and they employ 35% of all employees according to U.S. Census statistics.  Also, historically economic recoveries are have been on the growth of small businesses.

So, I hope you supported Small Business Saturday.  But, I hope you support small business everyday.

What is your favorite small business?

–J. Nolfo helps companies understand their customers though a variety of market research strategies. He has over ten years of experience of market research for strategic planning purposes. He is the Director of Research at Rhino Market Research. He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“. If you would like to discuss this blog or how J. can help you understand your customers, email him at jnolfo@rhinomarketresearch.com.

Using Customer Data in Market Research

Birds of a Feather“There are a lot of companies that have data, but not information.” 

I was lucky enough to be on the receiving end of that quote at an event during Triangle Entrepreneurship Week in Raleigh and Durham, NC a few weeks ago, where I met a great group of entrepreneurs and small business owners.  The unfortunate aspect of this quote is that it is very accurate.

Being able to utilize data from customers is of the upmost importance when trying to find more of them.  “Birds of a feather flock together.”  Well, this is true in regards to customers.  Similar customers buy similar stuff.  By understanding who your customer is, where they are, and (most importantly) why they buy, you can use that information to attract more  customers just like the ones you already have. 

Today’s market is much more complex and less receptive to media and advertising messages.  However, by narrowing the target of your customer, you can send targeted advertising specifically to them.

How does your marketing process gather intelligent information on your core customer’s needs?  And how do you use this information to target other potential customers?

–J. Nolfo helps companies understand their customers though a variety of market research strategies.  He has over ten years of experience of market research for strategic planning purposes.  He is the Director of Research at Rhino Market Research.  He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“.  If you would like to discuss this blog or how J. can help you understand your customers, email him at jnolfo@rhinomarketresearch.com.

The ABC’s of Business

Sold Home For Sale Sign in Front of New HouseOwning and running a business is not as easy as reciting your ABC’s, but the basics of business can be just as easily remembered. 

Here is the first three letters:

Always
Be
Closing

Regardless of your position withing your organization, if you and your employees are always closing (sales),  then you are already ahead of a large percentage of your competition.

This attitude is especially needed in micro and small businesses.  Sometimes their very survival is based on an ABC closing.

In what ways does your organization promote every employee to ABC (Always Be Closing)?

–J. Nolfo helps companies understand their customers though a variety of market research strategies.  He has over ten years of experience of market research for strategic planning purposes.  He is the Director of Research at Rhino Market Research.  He shares his thoughts about market research and business concepts with his blog “Pensare…Understanding Market Research in Business“.  If you would like to discuss this blog or how J. can help you understand your customers, email him at jnolfo@rhinomarketresearch.com.

Small Business and Tax Reform

Open for BusinessIn an open letter, the International Franchise Association (IFA), a lobbying group for franchises like Dunkin Donuts, McDonald’s and Starbucks, is asking the U.S. Senate to “tackle comprehensive tax reform in order to improve the business environment for America’s 825,000 franchise small businesses.”

Unemployment is high.  Nationally, the rate is 9.6% as of September 2011.  In the Raleigh-Cary MSA, it is 8.8% and 8.2% for the Durham-Chapel Hill MSA (August 2011 figures).  To put this in comparison, “long-term full employment” is 5%.  So how is the unemployment situation (and in turn, the economy) going to get fixed?  Many, regardless of  political perspective, believe that this is going to be done by small business. 

How is the economy affecting your ability to hire?

–J. Nolfo helps companies understand their customers though a variety of market research strategies.  He has over ten years of experience of market research for strategic planning purposes.  He is the Director of Research at Rhino Market Research.  He shares his thoughts about market research with his blog “Pensare…Understanding Market Research in Business“.  If you would like to discuss this blog or how J. can help you understand your customers, email him at jnolfo@ymail.com.

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