Market
research
Your current location on this site:
Market research
Before launching your business, make sure you know enough about the
market. For instance: examine the demand, the competition, the relation
between supply and demand, consumer behaviour and other factors that
strongly influence how a business would evolve in the virtual World.
Here, in our
"Market Research" section we take a look at all that!
Steps in
market research
There are
several important steps that no online business owner must ignore. Here
are the steps to be taken into account:
Step 1:
Studying the online market's dimensions
Determine how
large the market is. Determine how many potential clients you would have,
if you would launch your online business.
You will have to
decide to whom you wish to sell your products/services (from which country
will your clients come from), the more potential clients you aim your
business at, the more effective clients you'll have, if/when you succeed.
the language of your site plays a crucial role in this.
Step 2:
Studying the relations between supply and demand
You have to
determine whether there is enough demand for the products/services you are
willing to sell. but if you haven't decided yet what you want to sell,
perhaps it's even better: you will have to find the products/services that
are often searched for and you'll select the ones that have high demand,
but low supply (which would make it easier to compete with rivals offering
similar products/services)
Basically,
you'll have to determine how often people search for certain keywords, you
can do this with
Wordtracker.
The site has paid and free services as well, the free (trial) version is
enough to determine the number of times a certain keyword or keyword
combination is being searched for on the major search engines and internet
directories.
Step 3:
Competitor evaluation
Never launch your business without examining the competition.
Examine the
quality, strength and popularity of your future competitors, other sites
that offer similar content, similar products/services.
You can do this
with the following tools: the
Alexa Toolbar,
which will help you determine the Alexa Rank and then there's the
Google Toolbar, which shows you
the Google Page Rank of websites, helps you determine their link
popularity as well (by measuring the number of backlinks pointing to that
certain site, visible to Google, of course).
Step 4:
Correct market targeting
Determine the
market that you'll target.
If you try
selling everything to everyone, you'll be more likely to go bankrupt. But
if you specialize on a certain market, a certain domain, then you'll be
more likely to succeed.
Select your
market in relation to your capabilities and the experience that you have.
Also take account of the actors that activate in that certain market:
competitors and potential clients.
Step 5:
Market segmentation
Segment the market on subcategories.
It will be
easier to attack the subsegments than the whole market. The smaller your
niche is, the smaller the competition, but the potential clients will also
be less and so will be your profit.
It is
recommended to attack multiple market segments, subsegments, trying to
gain competitor advantage in as many of them as possible.
Step 6
Determine the market's characteristics
Find out as much
as possible about the market and all that is in it: from the potential
clients to the competitors, try to learn how it works, take account of
previous experiences, even rumours about how it has evolved.
After these
steps, you can add your own activities, but never leave these out, if
you're aiming at success!
The online
market research might seem easier in these 6 steps than it actually is, be
prepared for hard work, lots of tables with figures, comparisons and
calculations. However, we'd recommend you to follow your instinct too.
Often, online businesses go bankrupt because they take account of the
numbers/figures and less of the human side of a business. Numbers don't
guarantee anything and they can often be misleading.
Subsections under this category:
Market
segment targeting
Market segments are to deeply analyzed in order to create adequate
strategies that'll lead to success. Otherwise, your online business is a s
good as bankrupt.
Check this
section for more about finding potential clients.
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