This document provides information about conducting marketing research for entrepreneurs and small businesses. It discusses: - The importance of understanding the competitive landscape and having good market intelligence to make better business decisions. - How competitive intelligence can help businesses improve planning, develop strategies, avoid surprises, and increase sales. - Common approaches small businesses take to competitive intelligence that are ineffective and don't provide a true return on investment. - Key aspects of market research small businesses should consider like understanding customers, products/services, competition, and purpose of research. - Types of marketing research, budget considerations, and resources available to small businesses for conducting research projects.

1. Marketing Research for Entrepreneurs

2. In business, knowing what is really going on is the
difference between an innovator and a follower.
Corporate executives are turning to competitive
intelligence to help them make better business
decisions. Competitive intelligence is a formal and
systematic process, providing distilled information
that provides critical insights that aren't always
obvious. The problem is that most companies - up
until now – didn't have the time or effective
resources to get a true return on their investment.

3. In business, as in war, victory often goes to the one with the best
information.
Effective competitive intelligence solutions (CI) can help organizations:
Improve competitive planning and decisions.
Map effective product and market strategies.
Develop an early warning system and avoid competitive surprises.
Block competitive efforts.
Reduce sales and marketing costs.
Win more sales deals and increase revenue.

4. The best way to describe most companies'
current approach to competitive
intelligence is: reactive, hit-or-miss,
intermittent, unfocused and non-structured.
While the responsible parties may have the
right intentions, this approach is
ineffective at qualifying what is really going
on in the marketplace.

5. Market Research: The Key to Defining Your
Focus

6. Market information known to you.
Own Costs
Competition
Market Demand
Market Price

7. Market information unknown to you.
Consumer Response
The Incumbent’s Reaction to your
offering
The Emergence of New Competitors
The Economy
Random Factors

8. I believe there are four key steps for
successful marketing:
Understanding the customer
Making value for your customer
Communicating your value to your
target market
Making it easy for the customer to buy.

9. What is marketing research?
According to the American Marketing
Association, marketing research is the
systematic gathering, recording, and
analyzing of data about problems
relating to the marketing of goods and
services.

10. Every small business owner-manager
must ask the following questions to
devise effective marketing strategies:

11. Who are my customers and potential
customers?
What kind of people are they?
Where do they live?
Can and will they buy?
Am I offering the kinds of goods or
services they want - at the best place,
at the best time and in the right
amounts?

12. Are my prices consistent with what
buyers view as the product's value?
Are my promotional programs working?
What do customers think of my
business?
How does my business compare with my
competitors?

13. What is the purpose of marketing
research?
Marketing research focuses and organizes
marketing information. It ensures that
such information is timely and permits
entrepreneurs to:

14. • Reduce business risks
• Spot current and upcoming problems in
the current market
• Identify sales opportunities
• Develop plans of action

15. What are some common misconceptions about
marketing research?
Many entrepreneurs think that marketing
research should only be done by a small business
when they are making a profit.

16. Sometimes managers believe that unless
research provides a complete description
of a situation it is of no value.

17. The misconception that marketing research
requires big dollars keeps many entrepreneurs
from doing research.
Marketing research can be done at many
different levels both big and small. Many
research projects can and are being done for
$1000 or less.

18. Another misconception is that you can not do
research unless you are a sophisticated
researcher. You don't need an MBA. in
marketing or statistics to do marketing
research. Marketing research is mostly just
hard work. Consult a good marketing
consultant for advice and dig in and do it.

19. Is marketing research worth the expense?
A recent survey of small business managers
revealed that 84 percent of those having
conducted formal marketing research
projects in the past three years felt that the
information obtained was worth the money
spent

20. Overall, 65 percent said that they were
able to incorporate the research findings
into their decision making process. Only 7
percent reported that they were not able
to implement the results

21. Consequently, I believe that when small
businesses do engage in marketing research
the benefits usually exceeds the costs.

22. How large should your marketing research
budget be?
As a rule companies have marketing
research budgets that range anywhere from
.02 to 1 percent of company sales. Many
companies spend 50 percent or more of the
marketing research budget buying research
from consulting firms. For new companies
they must learn to do most of it themselves.

23. What topics do small business
managers and entrepreneurs address
through marketing research studies?

24. What is your target market?
How big is it?
Who buys your product?
Why do they need it?
Who pays for it?
Who uses it?

25. How do the users fix the business
problem you're addressing today?
How much are they willing to pay?
Why would they buy from you?
What business problems are more
important to them than this one?

26. What are the two basic types of marketing
research?

27. The two basic types of marketing research are
quantitative and qualitative. Quantitative
research answers questions that start with
"how many" or "how much". Qualitative
research addresses issues that deal with
"why" or "how Quantitative research usually
involves surveys while qualitative studies rely
on observation or unstructured conversations
with customers.

28. Where can I get help for marketing research
projects?
When researching your business idea, it is
important to do as thorough a search for
information as is possible. It is also
recommended to do as much of it as you can on
your own.
This will help you know the market for your idea
better, and can help to keep the costs down at
the start.

29. Some Places to start your research.
Factiva
LexisNexis
Business Source Premier
ProQuest Direct
Thomson Research

30. Factiva is an online database designed to
allow access to business and financial
information. This service covers publicly and
privately held companies, industries, the stock
market and the economy. Coverage is
domestic and international. Current stock
quotes, full-text newspaper, wire, and
magazine articles, and company profiles can
be located via a user-friendly web interface.

31. LexisNexis provides access to full-text articles
from thousands of newspapers and magazines
worldwide. Full-text SEC filings are available.
Many local and most national & international
newspapers are included. Extensive coverage of
the accounting, tax, and legal literature

32. Business Source Premier The Business Source Premier database
is a comprehensive, business periodical database that includes
scholarly journals and business periodicals covering topics such
as management, economics, finance, accounting, international
business and much more. It contains content from full text
sources ranging from general business periodicals such as
Business Week, Forbes, Fortune, American Banker, etc. to
academic journals such as Harvard Business Review, Journal of
Management, Academy of Management Review, Review of
Economics & Statistics, etc. It provides cumulative indexing and
abstracts for 4362 business journals (3228 peer-reviewed) and
cumulative full text for 3428 journals (2568 peer-reviewed).

33. This database also includes Country Monitor and
Industry Yearbook Reports from WEFA, 35
country reports from the Economist Intelligence
Unit (EIU) and Wall Street Words. The peerreviewed full text content in Business Source
Premier is unmatched, and full text back files are
available for many journals back to 1990.
Additionally, Business Source Premier includes
embedded images for many of the full text
journals.

34. ProQuest Direct is a web-based service . ProQuest
Direct indexes articles from over 1,000 business
and general publications. This database covers a
range of subjects from company information to
marketing and management trends.

35. Thomson Research provides web-based access
to complete SEC filings for U.S. and
international companies. Real-time and
historical EDGAR filings. Full-text articles and
summaries from the trade press, newspapers,
wire stories and newsletters worldwide.

36. Journals/Newspapers Business Internet Index
In the white paper you will find a detailed list
of places I use.

37. Review
Market Analysis
Who is your customer?
Knowledge of the customer enables you to
determine the market size and what
determines their buying decision. It provides
information that will assist in choosing a
location, determining product or services to be
offered, establishing pricing and planning a
selling strategy.

38. Key issues to consider are:
Who will buy your product? Primary and secondary
target groups.
Where does the buyer live and what is their profile?
What factors influence the decision to buy?
Who is involved in the purchase decision?
How often will buyers buy?
Where do they buy, when and how much do they buy?
What are the buyer's preferences and needs?
Are customers loyal? Can long term relationships be
built?

39. What product or service are you selling?
An important aspect of market analysis is to
ensure that the product or service meets the
market (customer) needs. Product or service
focus must be the customer.

40. Issues to address are:
Specifications of all your products and or services and
key features relative to what prospective buyers in your
target market are saying they need.
Comparison with competitors and how customers
perceive your product relative to others available.
What are the current trends, what stage of maturity is
the product life cycle at?
What regulations apply to your product or service?
What packaging is required?

41. Who is your competition?
Are there competitors that exist now and what
new competitors are likely to enter the
market? How will your product or service
compare and what is the probable reaction of
your competitors once you enter the market?

42. Issues to consider are:
Who are your major competitors?
What share of the market do they have?
What are their strengths and weaknesses (e.g. quality,
price, service, payment terms, location, reputation, etc.)?
How do you compare to your competitors and how will
they react to your entry into the market?
What factors are there that could increase or reduce
your competition?

43. What is your target market?
Accurate identification and analysis of the
target market enables you to develop an
effective overall marketing strategy. The
information will assist in determining business
size (output requirements), distribution
channels, pricing, promotion strategy and other
marketing decisions.

44. Target market issues include:
What is the overall market size? Number of
potential customers and physical boundaries?
Which segment of the market is the most
attractive in terms of future growth
potential, ease of entry, competition, profit
potential and overall risk?

45. How do products generally get to the customer?
What is the current dollar value or quantity of
product/service being sold into each segment of
the market?
What social, technical, environmental or
economic changes are taking place within the
market and how will they impact sales?

46. What are your distribution channels?
There may be many options for moving your
product to the customer such as direct retail,
wholesale, consignment, broker etc. The
method of distribution has important
implications affecting your pricing structure,
advertising message, cash flow, etc. You will
want to choose the distribution method best
suited for your product and where you want to
be positioned in the marketplace.

47. Key issues are:
What methods of distribution are best suited for your
product?
What methods of distribution do your competitors use?
What are the costs relative to market coverage?
Does your level of available capital or production
capacities restrict your choice of distribution methods?
Are there ownership opportunities in the supply chain?

48. Pricing
The objective is to maximize profits while
remaining competitive in the marketplace.
Pricing can be based on either the cost price or
market price (What will the market pay?).
Regardless of the pricing method used, it is
critical to know all of your costs involved in
delivery of your product or service to avoid
possible underpricing and operating losses.

49. If the market will not support a price level
sufficient to cover cost, it will be necessary to
investigate whether costs can be lowered or
alternatively, it may be necessary to abandon
your plans to proceed.

50. Issues to consider are:
What control do you have over the product
price (e.g. exclusive product, no competition,
high market demand, etc.)?
What are competitor prices and how do they
price their products?
What price and sales volume are needed to
achieve profit objectives?

51. Can you sell your product at different prices
into different markets?
Can you maintain your prices over time and
what do you expect to happen to competitors
prices?
Are your prices quantity sensitive?

52. Promotion and Selling
Promotion of your product or service and
development of a promotion strategy is part of
the market analysis. It is important to analyze
what are the best methods of making your
customer aware and what message will
motivate them to buy. From the promotion
strategy the advertising budget and overall
sales plan are then developed.