Save Your New Business Idea With Market

¶ … Save Your New Business Idea with Market Research. Forbes Magazine. 3/28/2013.

This article is directed specifically at entrepreneurs and focuses on the importance of thorough market research during the planning and launch phases of a new business. The author refers to reliance on hunches alone as a prelude to business failure. To be successful, young companies must fully define and understand their customer base -- their opinions and preferences -- and fine tune offerings to meet and exceed customer expectations. As the article points out, market research fulfills this very important purpose, particularly when testing new offerings. It is presented as a continuous process of collecting and analyzing data to truly understand and fulfill the needs of the customer.

Businesses exist to help customers with real or perceived problems. However, the full scope of the problem in question may be misunderstood without solid market research (Rhey & Gryna, 2001). This can translate into missed competitive advantages and strategic positioning, a loss of repeat business, and most importantly a loss of sales. The article points out that a lack of adequate, preliminary research can result in a failed return on investment. Some businesses may be doomed before they ever launch. The over-arching idea (presented in the form of four questions at the end of the article) is that it is good business practice to fully investigate the scope of the problem a product or service is seeking to solve, better define customer segmentation, explore other potential needs that could be addressed, and ensure that you are pitching your offerings to the proper target audience.

Overall, I found this piece to be straightforward and candid -- it offers sound advice regarding the true value of market research and offers insight about the benefits to be gained. I thought that one other area that could have been highlighted is that market research offers the data necessary to reach a target market at a price customers are willing to pay. As brought out in class discussion and readings, product, place, price, and promotion are key in business. Market research can be invaluable when defining each of these areas.

The information presented is solid business sense. Market research basically organizes marketing information. It can also enable the savvy business owner to spot current and upcoming problems in the market, reduce business risks, identify sales opportunities, and develop plans of action (Rhey & Gryna, 2001). Even an inexpensive research program using surveys and questionnaires can uncover customer dissatisfaction or possible new products or services.

Successful marketing requires timely and relevant information. Small business owners have a sense of their customers' needs from years of experience, but this informal information may not be applicable to the current market. Effective market research will identify trends that affect sales and profitability such as population or economic shifts that should be monitored to quickly identify problems and opportunities. Proper research allows for timely reaction to market trends as well as a means of staying abreast of competitors' strategies.