Market Research for Business Plans


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Where can you get the information to complete the market research section of your business plan? Here are some sources - most free, some fee based - to get you started.

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Market Research for Business Plans

  1. 1. Market Research for Business Plans Research Edge May, 2014
  2. 2. Some background (C) RESEARCH EDGE 2014
  3. 3. The goal….to maximize your profits The strategy…to determine your ideal positioning, given • Your industry’s dynamics • Your competition • Your potential customers (C) RESEARCH EDGE 2014
  4. 4. Research methodologies (C) RESEARCH EDGE 2014 Primary - New research to answer a specific question Secondary – Information previously researched for other purposes and publicly available.
  5. 5. Sources of information (C) RESEARCH EDGE 2014 Observation Surveys – mail, phone, online, personal interview Newsletters and journals Professional and trade associations Websites, Blogs Social media platforms Market research reports Business databases
  6. 6. Some research tips (C) RESEARCH EDGE 2014 Research is a treasure hunt Who cares? Use effective techniques
  7. 7. NAICS codes (C) RESEARCH EDGE 2014 The North American Industry Classification System (NAICS) is the standard used by Federal statistical agencies in classifying business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy. Use for accessing government data and company lists.
  8. 8. Environmental Scan (C) RESEARCH EDGE 2014
  9. 9. Industry Dynamics (C) RESEARCH EDGE 2014
  10. 10. Industry (C) RESEARCH EDGE 2014
  11. 11. Industry – types of information Market size ($) Market share Recent trends Growth potential Stability/volatility Seasonality Political/legal Socio-cultural Technological development Global issues Patents/intellectual property Environmental issues (C) RESEARCH EDGE 2014
  12. 12. Industry resources - governmental (C) RESEARCH EDGE 2014 Industries at a Glance Bureau of Labor Statistics. Industry breakdown, workforce statistics, earnings, etc. Economic Census Census Bureau. Number of establishments, receipts, annual payroll, total employment. Trends over time. County Business Patterns Data available at county and zip code level. number of establishments, employment, payroll
  13. 13. Industry resources – market reports (C) RESEARCH EDGE 2014 Sbdcnet provides free market research for many common small businesses Check out the Small Business Snapshots and Market Research Links sections Inconsistent content, but may have Industry Overview, News & Trends, links to industry associations, statistics, customer profiles.
  14. 14. Industry research – other free sources Google Scholar – search engine for research documents Magportal – searchable database of magazine articles HighWire – free full text scientific articles Directory of Open Access Journals - scholarly (C) RESEARCH EDGE 2014
  15. 15. Industry resources – fee based reports (C) RESEARCH EDGE 2014 • Hoovers • First Research • Avention (formerly One Source) • Marketline (formerly Datamonitor 360) Some excerpts are free; full reports in $129 - $139 range.
  16. 16. Industry resources - news (C) RESEARCH EDGE 2014 Many free newsletters are available – search for one in your industry SmartBrief Hundreds of free industry based topics – healthcare, construction, energy/chemicals, education, retail, media, technology, finance, food & beverage, hospitality, etc.
  17. 17. Industry resources – online search (C) RESEARCH EDGE 2014 MY INDUSTRY news OR “market research” OR “industry report” OR overview MY INDUSTRY forecast OR trends OR projections MY INDUSTRY association OR “trade group” Many have a Resources section with free information.
  18. 18. Competition (C) RESEARCH EDGE 2014
  19. 19. Competition - types of information Strengths Weaknesses Market share How long in business Product mix Sales volume Pricing Marketing strategy Distribution channels Suppliers Primary clients (C) RESEARCH EDGE 2014
  20. 20. Identify your competitors Observation Web search Yellow pages Business database (C) RESEARCH EDGE 2014
  21. 21. Database advantages Complete set of businesses Can target specifically via NAICS codes Can specify exact geographies – not restricted to locality Includes “non brick and mortar” types of businesses Includes wealth of information – number of employees, sales volume, estimate of credit worthiness, corporate affiliations, etc. (C) RESEARCH EDGE 2014
  22. 22. ReferenceUSA via public library (C) RESEARCH EDGE 2014
  23. 23. ReferenceUSA detail (C) RESEARCH EDGE 2014
  24. 24. Research competitors Company website Personal visit Social media pages Online reviews Comments in social media More information on company research (C) RESEARCH EDGE 2014
  25. 25. Other business databases Free LA Secretary of State Manta CrunchBase (technology) ThomasNet (suppliers) Fee Hoovers (D&B) InfoUSA zoominfo USAData (C) RESEARCH EDGE 2014
  26. 26. Customers (C) RESEARCH EDGE 2014
  27. 27. Target market (C) RESEARCH EDGE 2014 The consumers a company wants to sell its products and services to, and to whom it directs its marketing efforts. A target market can be separated from the market as a whole by geography, buying power and demographics, as well as by psychographics. (Investopedia)
  28. 28. Define your niche (C) RESEARCH EDGE 2014 Based on the research of your industry and your competition, where is your advantage? How will you compete? Cheaper, more convenience, additional features, better customer service? Who are the customers in this market? Is the market big enough to allow a profit? Is it the same market as your competitors? How will you stand out? What percentage share would you need to divert? If a different market, is it viable?
  29. 29. Refining the target market Business Type of business Size (revenue) # of employees # of locations Business structure Years in business Individuals Geographic scope – neighborhood, city, state/region, national Demographic – age, gender, income, education, occupation, marital/family status, ethnic background Psychographic – personality, attitudes, values. Lifestyles, interests/hobbies, behavior (C) RESEARCH EDGE 2014
  30. 30. Segmentation (C) RESEARCH EDGE 2014 A marketing term referring to the aggregating of prospective buyers into groups (segments) that have common needs and will respond similarly to a marketing action. Market segmentation enables companies to target different categories of consumers who perceive the full value of certain products and services differently from one another. Generally three criteria can be used to identify different market segments: 1) Homogeneity (common needs within segment) 2) Distinction (unique from other groups) 3) Reaction (similar response to market) (Investopedia)
  31. 31. How to research customers Primary Surveys Blogs, forums Comments in social media Competitor websites Secondary Market research reports Suppliers Industry or trade associations (C) RESEARCH EDGE 2014 More information on target markets
  32. 32. (C) RESEARCH EDGE 2014 Research Edge is a New Orleans based consulting firm specializing in business research and strategy. We help clients understand their customers, their competition, and the environment in which their business operates so they can make smart decisions. Cynthia B. Fromherz, Principal Contact us at: