Give Your Startup A Jumpstart With These Market Research Strategies

Every new business goes through some common challenges and also discovers some new ones. One of the most common and notable challenges that startups face is to gain early traction. 

Initial Traction is crucial for every startup. It not only opens the door to more investment and growth opportunities but also helps in the validation of your Product-Market Fit. 

If your product provides the perfect solution to target customer’s problems, they would cluster around you just to give the product a try. 

The key to achieving the ideal product-market fit is an effective Market Research Plan. In order to cut your learning curve short, here is a guide to market research for tech startups– Meaning, Process and the common mistakes made by every startup like you. 

So, buckle up and be ready to take your startup to the next level. 

Why Do Startups Need Market Research?

Market research is the process of knowing your target audience better. From their food habits to their lifestyle, market research provides companies with every detail they need to understand their customers and fulfill their needs accordingly.

It’s a key element of any tech entrepreneur’s business plan as market research supplies data for the followings: 

• The sales potential of your product. 
• Discovering new ways to attract customers and sell products/services.
• Finding hurdles that could de-escalate your business growth.
• Keeping an eye out for any opportunities to beat competitors. 
• Projection of future revenue and so on. 

Even if you are a part of a thriving tech startup, the right market research will always help you to become better and to create new successful products. 

Common Market Research Mistakes:

Every company faces its challenges and make their own mistakes. Challenges confronted by small and medium-sized organizations are very different from the struggles of the startups (if it’s specifically tech-based). 

The very nature of tech startups is the reason behind these differences— limited funding, truly unique ideas, inadequate competition analysis. 

It’s easy to get lost in the maze of these challenges and make some of the following mistakes: 

1. Poor Selection Of Research Material:

The Internet is a great place to start researching the market and the audience. It provides companies with lots of insights into their target audience.

Websites and business libraries also offer a deep understanding of every concept relating to market research. However, there is no shortage of outdated and/or biased research materials. For instance, these days everyone sprinkles stats, found from different studies, on their content without so much as a basic review.

If they will look closely, they will notice that crucial details like year of research, sample size, demographic, research methodology, etc often don’t get any mentions.

This is just one such instance. There are many like this that could have a considerable impact on your business. Therefore, it’s really important to verify every piece of information you found on the internet.

2. Ignorance towards Competition

This is a big one. Many entrepreneurs don’t pay much heed to their competitors. 

Their performance on the market, marketing and advertising strategies and their strengths and weaknesses. These factors are really important to look up for in your competitors so that you don’t make the same mistakes as them.

As a result, you can avoid such missteps and play to your strengths.

It’s not super hard to research your competitors. There is a lot you can understand by simply looking at their marketing campaigns.

For instance, smart companies are now leveraging social media platforms for app marketing purposes. Websites like Angelist and CrunchBase maintain a wealth of information about nearly every registered startup. Those databases come in handy during competition analysis. 

3. Not segmenting the Target Market

Firstly, you need to think and get an idea about your target audience, before plunging into audience research/interview.

A large group of customers can be segmented into multiple subgroups based on their demographic and psychographic, economic profiles.

Each of these subgroups differs in their preferences and perspectives. If you ignore these differences and concentrate on them as a whole or just focus on one subgroup, it can hurt you in the long run.

For example, Blackberry users have become non-existent in the US. However, it has still considered a status symbol in Africa.

If you were targeting business people in both continents but don’t take account of your African audience’s preferences, you would be doing yourself a disservice. 

Apart from these major mistakes, not having the resources to translate the data, poor resource allocation, trusting misleading data, etc. can also sabotage your market research and, by extension, your startup. 

Now that you have understood your mistakes, let’s dig into the various ways to do market research and provide your customers the best!

Ways To Do Market Research For Tech Startups

Every startup has different criteria and standards to consider when it comes to market research. But the two methods of collecting data, Primary and Secondary are conducted by every company.

Primary market research means uncovering the basic details about your audience and your competitors.

What your audience wants, your competitor’s campaigns and operations, etc. Secondary research, on the other hand, provides the framework for visualizing the bigger picture– The kind of economic trends you can expect, audience preferences shift over the years, etc.

Here are some tested ways to conduct market research: 

1. Look Into Communities:

Relevant online communities are gold mines for market researchers. Your target audience is already sharing opinions and interacting with each other.

So, if that’s where your potential audience is, then that’s where you should be too.

By eavesdropping on those conversations and being a part of them, you could get a solid grasp on their pain points, thoughts, values, and insider information.

You can even interact with them and build solid relationships. This will not only help in growing your customer base but also build trust between you and them.

It’s pretty easy to spot active communities. A simple “keyword+forum” search on Google should give you the list of forums you are looking for. Apart from these, you have Q-A sites like Quora and community sites like Reddit.

Those sites are great for market research too. Social media groups are also great spots to start your research.

Become a part of these groups, participate in group discussions and you will notice the change yourself. Members will be more open with you and will also respond to your requests.

2. Interviews 

No one can provide more genuine and in-depth insights about your target market than the people who are already part of it.

Talk to your existing customers, sales reps, field executives, and potential customers. Interview them and ask about their experience with your company and get detailed “insider news” that has the potential to help you in the long run.

Interviews are based on the qualitative approach and best fitted for uncovering motivations behind customer’s actions.

It’s really important to make your customers comfortable and therefore, it’s recommended that you start with a handful of open-ended questions and let the conversation flow. 

Face-to-face interaction, video calls, telephone– interviews can be conducted in different ways. Pick the channel that suits both you and your audience best. 

3. Online Survey:

We all know that investors love numbers and the best way to draw numerical conclusions from collected data is through Online Surveys.

It’s a popular way of doing market research as it also helps in uncovering customer behavior patterns.

Unlike interviews, you strictly follow a questionnaire while surveying.

Make sure your questions short and avoid leading or difficult to answer questions. Don’t forget to offer incentives ( could be a lead capture, discount, or gift) either. 

In case you are wondering, tools like SurveyMonkey and SurveyGizmo allow you to design and plan your survey questionnaires. 

4. Secondary Research Using Public And Commercial Sources

Secondary research starts when Primary research ends. It provides us with insights that are difficult to get through primary research. For example, if you need weather data for the last 10 years, it’s easier to purchase the data. 

Commercial sources like research and advisory firms are also great sources of secondary research data.

Reputed research firms like Gartner and Statista stick to proper research methodologies which makes their finding reliable. 

Education institutes like universities are often overlooked as great information sources. They offer an extensive range of knowledge, both primary and advanced.

This is a major wastage of opportunity if you ask me. From tech to business, educational institutes provide insight into every industry.

You can get access to their extensive knowledge by reaching out to them. 

(Note: Here is an excellent guide on secondary research to get you started. )

5. Build An MVP

MVP is a very important concept for tech entrepreneurs. Conducting market research by creating an MVP first is one of the best ways to validate their ideas. MVP is a product with just basic features that allow entrepreneurs to validate their ideas and gather feedback.

 Basically, you take your MVP before your target audience, gauge their reaction and later add more features (and target a unique audience segment) for better product-market fit. 

Many successful tech startups tried this before. Let’s take the example of Dropbox. Founder Drew Houston used a video published on Hackernews as MVP. He also created a landing page with a subscription box.

He managed to get 75000 sign-ups initially. Another example is Facebook. It started as a basic social media for college students. Later it expanded in size and became the behemoth as of now. 

6. Hire A Market Research Firm 

Just having the knowledge of market research and enough resources doesn’t guarantee your success. It’s always better to take it to the experts who not only have better knowledge but also some experience about the market.

However, that firm should check off the following boxes: 

• Recent experience of working with similar brands.
• Transparent and effective research methodology.
• Tailored approaches according to the unique needs of your startup. 
• Dedicated project manager and resources.

Once hired, those firms can take care of your entire market research. 

Market Research For Startups: In A Nutshell

Market research has the power to make or break your startup. It’s not an easy way but definitely one of the surest ways to success.

It reveals future opportunities, pitfalls and best ways to entice your customers. It gives you the upper hand in the market and makes you stand out from the competition.

It makes sense you do it early when your product is in its infancy stage. Whether you do it yourself or hire an agency, the right market research is your ticket to future business success. 

We being one of the most reputed and globally recognized brands, focus on providing all-around mobile app development solutions to our clients. And developing a solution is never done without proper competitive market research. Want to know more about how market research for startups can help you in getting good ROI? Have a free consultation with our experts today.

P.S - This article was originally published in https://www.innofied.com/market-research-for-startups/

ABOUT RITESH

Ritesh Osta is a Tech Marketer at Innofied Solutions, an Award-Winning Software Company based in India, US, UK, and Australia. As a Tech strategist, he has been certified by Oracle and SAP. He has had the privilege of working with Fortune 500 companies like Nestle, Amkor, & Mahindra for 14 years.

Now, he helps Startups and Entrepreneurs create, launch, and promote Digital Products to establish their brands. He is currently on a mission to help 100,000 Businesses and Startups launch & grow their technology business.

He is also a Certified Public Speaker and Trainer with a love for coaching people. As a cat lover, he is a part of PAWS; an organization that provides shelter to homeless animals.