The Ultimate 5-Step Guide to Conducting a Thorough Market Research for Your Start-up

ultimate marketing guide

The Ultimate 5-Step Guide to Conducting a Thorough Market Research for Your Start-up

It’s interesting how searching the internet can yield so much data, yet so little knowledge! Since producing high-quality content is one of our core values at Tianlong Services, we decided to save your time and energy to bring you everything you need to know about market research for start-ups, all in one place!

Why Do You Need Market Research?

It’s no secret that start-ups face an uphill battle. Some quick marketing research reveals that 30% of new businesses fail in the first two years of operation, 50% in the first five years, and 66% in the first 10.

Some of the top benefits of market research for small businesses include:

  • Creating more compelling marketing materials
  • Identifying more targeted niches for your business
  • Minimizing the risk of bad positioning that unknowingly kills potential leads
  • Suggesting ideas for new products or services based on pain points
  • Updating you promptly on industry trends ahead of your competitors

In a nutshell, effective market research helps you reach all your potential customers effortlessly. A thorough market analysis also reassures any current or future investors that you know what you’re doing, and that you’re the right entrepreneur to address the gap in a particular market.

Therefore, to conduct a thorough market analysis to skyrocket your start-up business, you need to cover the following steps:

Step 1: Industry Overview and Description

How does the industry of your start-up look like?

Conducting a successful market research for your start-up begins with fully understanding the existing industry, including the dynamics of your specific niche. You need to know the size of the market, trends, life cycle, and projected growth patterns. Understanding the outlook of your industry provides you with a solid foundation of knowledge regarding the broad view of the rest of your market.

As a start-up owner, you must have the latest marketing trends of your niche industry on your fingertips. Increase your awareness by conducting market research surveys, reading start-up research reports and actively participating in industry-specific conferences, seminars, webinars, and workshops. This will provide you with a bird’s view of upcoming trends within your niche industry. Moreover, engage yourself with online tools to gather important information about various market trends.

Step 2: Market Segmentation

What does your target market and target audience look like?

As a start-up owner, it is very important for you to have knowledge about your buyer personas and potential customers because not everyone will buy from you. If your start-up business targets more than one market segment, your demographics and segmentation should clearly outline their characteristics. A buyer persona is a semi-fictional depiction of your potential customers. To develop buyer persona, you need to make phone calls and/or conduct online surveys to gather relevant information. 

Begin with relevant demographics, such as age, gender, race, marital status, occupation, annual income, education level, etc. The specifics will narrow down exactly who you are targeting and outline more general demographics of other possible segments, including geographic segmentation (where do people live) and behavioural segmentation (what are specific, relevant actions people take).

Step 3: Market Need

Why should potential customers buy your product?

Imagine you have created a wonderful product, but no one is purchasing it because your chosen market is already saturated with similar products and your target customers find it costly or useless! Discouraging right? As a start-up owner, you need to know why customers will buy your product and at a specific cost. Therefore, it is vital to examine a market comprehensively to determine whether customers have a need for it.

Remember, market need does not examine the nature of your competition. It helps you have an overview of the market with regard to trends in customer behaviour in order to add some value to their experience with your product. Furthermore, it helps because you can find gaps that your product can fill by implementing the five P’s of marketing, i.e. Price, People, Place, Position, and Promotion.

Step 4: Competition

Who are your competitors?

One of the essential parts of a market analysis is scrutinising businesses that already exist in your field. Once you have identified them, outline their strengths and weaknesses to determine the extent to which your own start-up has a competitive advantage and marketing position over them. A healthy competition within your industry is a good sign. However, a stiff competition helps you understand the unprecedented challenges and prepare earlier.

A suitable way to boost your start-up is benchmarking your competitors using their key performance indicators (KPIs) to help you set your own goals bearing in mind the big picture of the industry. Furthermore, use the internet to monitor your competitors’ activities, the type of content they are producing, the technology they are using for their gains, etc.

Step 5: Regulation

What regulations are required to operate in your market?

Starting a business is exciting. Laws are not. Nevertheless, you need to understand the rules because failing to follow government regulations could lead to unsolicited and severe penalties. Getting on the government’s good side requires some effort for start-ups; however, the payoff is always worth it in the end. Laws are ever-present from establishing a legal structure to an accounting system.

You need to register your business and take care of business-specific tax liabilities. Furthermore, hiring workers comes with obeying employer laws overseen by the Ministry of Manpower in Singapore. Consider hiring a small business accountant at Tianlong as you set up your company. We can help you understand all government regulations required to operate in your market and the steps you’ll be taking to remain compliant with them.

Contact us for a free consultation today!

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