Small Business Expert

• Recent Articles
• Effective Interviewing
• Boosting Morale
• Performance Reviews
• Preventing Fraud
• Finding Office Space
• Customer Loyalty
• How to Pitch the Media
• How to Fire Someone
• Venture Capital?
• Three Sure-Fire Steps to a More Focused Workday
• Attracting Talent
• Reviewing Resumes
• Cost Cutting Ideas for Small Businesses
• Sizing Up Your Small Business
• Happy Mother's Day! A List of Small Businesses That Cater to Moms
• Green Businesses Are Blooming
• Raise A Glass And Say A St. Patrick's Day Toast
• Small Businesses That Will Make Your Sweetheart Swoon
• Resolution Roadblocks? Small Businesses That Can Help Keep You On Track
• Full Article Archive

• Success Stories
• Tiff's Treats

• Podcasts
• How To Attract Talent

Even Small Businesses can Reap the Benefits of Market Research

by Katie Ford

Interested in doing some market research to learn what your customers - or potential customers - think of your product or service? Congratulations -- you're ahead of the competition! Studies show that most small business owners skip this critical step due to lack of time or money, or because they perceive that it's too big of a task to execute.

Why make the investment? Because it's impossible to design effective business strategies and set realistic performance goals without market intelligence, says Mary Jo Martin, president of Cynapsus LLC. "Market intelligence improves every aspect of product/service development, marketing activity and sales force efforts," she says.

Market research involves five steps:

• Define your objective. What questions do you want answered and to whom will you ask them? Are you seeking qualitative or quantitative feedback - or both?
• Determine your data sources. Will you create focus groups and surveys or peruse research that already exists?
• Collect the data.
• Analyze your findings.
• Act on it. If you don't commit to adjusting your business model or product to correlate with your findings, you have wasted your time and money.

The Web is your best friend when it comes to market research. Here are a few tips on how to leverage the Internet.

Let others do the research for you. If you don't have time to do the legwork, explore what others have learned about your customers or your industry.

• Trade associations. There's an association for every special-interest group under the sun, and their subject-specific research isn't always limited to members only.
• The government. Agencies such as the Small Business Administration and the U.S. Census Bureau have oodles of statistics and trend-tracking data on households, business, and industry.
• Academia. Check out graduate-school libraries. "These departments have often pulled together Yahoo-on-steroids-style directories of resources for every conceivable market, product, and geography," says David Carpe, principal and founder of Clew LLC. "Many link to off-campus resources and free or low-cost tools and Web sites. Harvard Business School has great pages, and Babson College has some good stuff as well."

Participate in online communities and chat rooms. Some of the best customer insights can be gathered from online communities, chat rooms, and message boards. Brian Giamo, managing partner of Channel Economics LLC, says: "If you want to get feedback on a new product idea or gauge satisfaction related to competitive products, just post a few well-thought-out questions in an online community that matches your target audience. While it may not be statistically valid, more often than not it will be directionally accurate."

Use your Web site. One option to obtain customer and prospect feedback is to feature a link to a survey or place a poll directly on your Web site. "This often works well when customers of the small business are heavy users of its site or it is a Web-based business model," says Giamo.

Survey your customers. Zoomerang.com and SurveyMonkey.com are two free or low-cost platforms that allow you to create a survey and deliver it via email to your target audience. "Developing good, objective questions and the script that surrounds them is the most time-consuming part," says Paul Travis, an independent marketing consultant. "Before sending out the survey, hire a pro to look over the questions to catch any glaring errors."

A word of caution: It's illegal to survey online without permission, so stick to email addresses you've gathered with authorization - such as your contacts database or a company e-newsletter mailing list.

What makes a good survey? Chuck Martin, an adjunct marketing professor at the University of New Hampshire, offers these pointers:

• No one has extra time these days. Keep it to four questions or less.
• Set up the email survey process so that it's anonymous. People are more likely to answer -- and answer honestly.
• To maximize your reach, pitch the survey questions each time a phone call is made or taken with a customer.

However you proceed, be sure to scale the research investment with the potential revenue it affects, Travis says. "If you're wondering whether customers like red or blue signs on the bathrooms, invest a little," he says. "If you're weighing names under which to launch a new product or service, that would be worth a bigger investment - because a flop here is a catastrophe."