Knowing how the industry that you are about to venture in can save you time and money. Market Research is the effort to gather information about the behavior of the commodity or customers. It is a very important component of starting a small business.
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Gathering information about the product or service you are about to start offering, is a key factor to get an added advantage over competitors. It provides important information to identify and analyze the need, size, trends, demand and supply and competition.
As defined in the International Code on Market and Social Research, includes social and opinion research, [and] is the systematic gathering and interpretation of information about individuals or organizations using simple statistical and analytical methods and techniques of that are so easy to gain insight on and support decision making criteria.
Research is for discovering what people want, need. It can also involve discovering how they act. Once that research is completed, it can be used to determine how to market your product or services. Questionnaires and focus group discussion surveys are some of the instruments are used mostly for market research.For starting up a business, there are some important things:
Through Market information one can know the prices of the different commodities in the market, as well as the supply and demand- is the most important aspect when you are carrying out a market research. Demand is defined as the potential want of a product or service. You need to know that your business can not survive without having a readily available market; the markets determine the success or failure of your business.
Carrying out a real and factual research should be done together with the product testing or service testing. This will enable you the entrepreneur to realistic in your approach towards the market. If the market is favorable towards your product or service you should allow the market to pull your price(s) based on the demand. Information about the markets can be obtained from different sources, varieties and formats, as well as the sources and varieties that have to be obtained to make the business work.
Segmentation is the division of the market or population into subgroups with similar motivations, behavior and choices. These can have a direct impact on the out come of the market research conducted for the purpose of making a good business decision in the smooth running of the business.
Market research trends are the upward or downward movement of a market, during a period of time says a year, two years and so on. The market size is more difficult to estimate if one is starting with something completely new. In this case, you will have to derive the figures from the number of potential customers, or customer segments.