Market Research on the Cheap

When King Solomon was posed with an opportunity to receive anything he wanted, instead of riches or power, he chose wisdom. The King realized that wisdom was far more valuable than anything else he could have chosen. Ultimately he attained both power and riches, likely as a result of his wisdom, affording him the ability to make better decisions.

Market research yields wisdom. That said, it is often overlooked either because it’s believed to be too costly or not truly necessary. Truth is, market research is one of the most important activities a company can pursue. It illuminates opportunities. It delineates opinions. It offers direction. Market research for all its benefits is not only necessary but can be done affordably. Online surveys, informal focus groups and consumer encounters can provide a great deal of useful information. This information can assist in making informed decisions that will lead to more efficient and more fruitful business activities.

Online Surveys

One of the easiest methods of market research is the online survey. An online survey is a questionnaire designed to reveal insights about a given topic. Surveys are great for directional data. In my experience, if you can get about 100 responses, you will have solid directional results. I say directional because for data to be statistically significant you would need many more responses, at least 1000. That said, I’ve noticed that after the first 100 responses the percentages will change slightly but the overall results will generally stay the same.

To conduct one of these surveys you can use websites like Survey Monkey or Google Consumer Surveys. Survey Monkey will let you ask up to 10 questions and collect 100 responses for free. Google Consumer Surveys charges 10 cents per response, so 100 responses would only run you $10. If you want a more robust survey, you can elect to subscribe to Survey Monkey for $300/year or set your target demographic with Google for 50 cents a response. Whichever you choose, they are both quite affordable and likely to yield information far more valuable than the small investment required to conduct the survey.

Informal Focus Groups

Focus groups are a great way of obtaining first hand opinions and perceptions about a topic. While some focus groups can cost thousands of dollars, there are other means to mine similar information. I often recommend to clients to create what I call a “board of directors”.

A board of directors is a group of 10 or so people that you can check ideas with, seek feedback from for current projects and help you to assess past successes and failures. The group meets monthly and its members serve for about 4 to 6 months. It’s important to change the members once or more a year to ensure you keep the fresh ideas and perspectives flowing. If members are in multiple cities, you can meet via the web, phone or email –– whichever proves most successful to get the best levels of participation.

I recommend creating two groups –– one panel of retailers and one panel of consumers. This will ensure you are getting a well-rounded point of view as it pertains to your competitive environment. The information you glean from these groups will be invaluable. They will steer you in the right direction and give you an objective perspective that you can use to move your businesses forward. Your board of directors will help you lead your company to growth and prosperity.

So how do you find these people and compensate them for their time? Finding retailers is not difficult. Sit down and think of markets that are key to your business and research retailers in that market. Create a list of prospects and approach them. Possibly offer them free product or free shipping for their time if finances are tight. For consumers, you can tap into your online sales data for email addresses (if you sell online), post an ad in your local paper for a local group or ask your retailer board to help you recruit. Similar to retailers, you can offer free product or a small stipend for their time.

Consumer Encounters

Another very revealing method of market research is an activity called a consumer encounter. A consumer encounter is to connect with consumers in the market place –– either at a store, park or other environment where your product is either purchased or used. The purpose of this is to understand the experience a consumer has either purchasing or using a product and/or service. Sometimes consumers will forget or not consider some relevant piece of information outside of their normal activities (as in a focus group) but will recall this information in the midst of an encounter.

Encounters are usually scheduled in advance with a consumer, and compensation is similar to that of informal focus groups. You can simply shadow them as they go about their day, asking questions. You can have a predetermined list of questions but most likely you’ll come up with more during the encounter. Similar to the consumer forgetting information, you’ll find ideas spurred during the course of the encounter that you had not previously considered.

Market Research on the Cheap

So you see, you don’t have to be a big company with lots of money to conduct meaningful market research. It’s relatively easy to obtain invaluable information about your products, their performance and perception with little financial resources. If you are willing to give a little time and possibly some product, the wisdom is out there waiting to be discovered.
 

---

 
About Insights Discovered

Penny Redlin is a regular contributor to the “Business Sense” feature on The Giggle Guide^®, sharing insights about business planning, effective communications and marketing strategies.

Based in Las Vegas, Nevada, Insights Discovered was founded by Penny Redlin in an effort to share her professional expertise within the children’s product category. The company’s mission is to give every mompreneur an opportunity for success. Insights Discovered exclusively services children’s products brands. The specific industry focus demonstrates a strong dedication to the unique needs of children’s products companies. Insights Discovered offers strategic planning, market research and traditional marketing services.

For more information, visit www.insightsdiscovered.com or call 702.218.5707.