Before starting an online business, you must confirm that there are actually going to be customers (demand) for your product or service. It sounds pretty basic stuff but you would be amazed how many start up entrepreneurs get so wrapped up in turning their ideas into reality that they completely forget this!
It's time to do your market research thoroughly to ensure that you truly understand who you are selling to and more importantly if they want to buy and if they are ready to buy.
So how do you go about doing this?
Well, a good way of actually finding out if people will buy your product is to ask them! So here's several things that you can do to validate the market and test if there really is demand for your exciting business idea:
You can create a survey and send it to your target audience. Just ask them outright what it is they find challenging with your topic or which problems they are trying to solve and see if your product fits with that and can solve those problems for them.
And you can ask them directly:
It is important to get a broad enough number of survey responses. If it's a direct to consumer business you're launching, 500 responses will give you a good basis of evidence and a wealth of data, which you can draw upon for your business planning work and to share with potential investors.
The information that you glean will indicate if your product idea is on the right track or totally wrong(!) and which type of product enhancements or variations (e.g. flavour, colour etc) would be more interesting than others.
It will also help you quickly identify potential best sellers, and keep you focused on where to invest your money if you are going to buy volumes of stock.
The results from your market research survey will also give you some of the exact language that your customers use to explain their problem or explain the challenge they are facing.
You can use that language and replay it back to them in your Sales copy, social media in the run up to launch and in early stage adverts. Using the specific keywords that your customers would actually use to search for your product is a savvy way to immediately create a connection with your potential customer.
So surveying your customers and deeply understanding your market BEFORE you launch your business will give you the confidence that you are choosing the right market to invest in.
If your survey results come back showing you that actually there's no demand for your product and your product or service offer isn't going to resonate with them at all... DON'T WORRY.
Give yourself a pat on the back and a hearty "Well Done!" for being clever enough to have done your Market Research...
At least you know before you have sunk your life savings into the business!
It's actually a good thing to get this insight into your market early on. It's just saved you a whole load of hassle, a whole load of time and money and heart-ache. Instead use this information to turn the situation around.
Ask - well, what are these customers actually looking for? What do they say they need and want to buy? Can I create that product / source it / deliver that service and sell them that instead?
I often get asked how do you do a survey if you don't have a customer list?
Well, don't forget customers live in the real world.. so you can put one foot in front of the other and actually visit where your customers hang out (whether physical or virtually) or even stop people and ask them in the streets.
For example with my first business I actually went and stopped people on the street outside of particular corporate office and London Tube station who looked like my ideal customer and asked them what product range they would want to see in a store, what they liked and even what things they didn't buy etc.
If talking to real people seems a little bit too scary right now, whilst you work up the courage to be bold you could do a series of Facebook ads where you can promote your survey to specific demographics that match your preferred ideal customer type. You will likely need an incentive for them to answer your survey.
So a good way to get people to answer your survey would be to incentivise them, for example:
There's are many tools you can use to gather market research data with a range of easy to use online survey tools. I like:
You can either embed these surveys into your existing website or you can add a link to it through a Facebook post pinned to the top of your page.
This means reaching out to other partners and other people who might be happy to share your product or service idea with their audience. Especially if you know that their audience will have some commonality with your future customers - this is a great way to quickly access meaningful potential customer opinions.
For example, perhaps you sell healthy snacks, so who else do you know who promotes a healthy routine ? Fitness businesses? Remember to incentivise and share the data with your collaborator if it is helpful to them. Look for the win, win. Always seek permission first.
Another great way to research and choose a market where there might be demand, is to look at Google keywords. Specifically you are looking for the monthly volumes of those keyword searches. How many people are searching on Google for your product/ keyword each month? Do you know?
By using your customers own language - how they talk about your product / service (taken from your survey data in Step 1 above), you can use this information to identify which keywords they might use in Google to explain the problem.
Make a list of the keywords they use and look those keywords up in Google's Keyword Planner tool or another free tool like Keyword Tool.io. You can download the keyword volumes and understand the scale of the demand for your product / service idea.
This is really useful to understand how many monthly global searches are made. You can even restrict it down just to a country that you're interested in. If there's lots of search volume for your product, that's a good indication. This means there is general demand for your product.
For next level analysis, you can also look at the keyword difficulty score these tools provide. If the keyword difficulty is really high, that means it's an incredibly competitive market to be in. If possible, you want to identify a market, or a subsection of a market that has good to low keyword difficulty. So ideally you are looking for what they call a "Niche market" that is not too competitive so that you are able to compete when you advertise and get organic traffic for that keyword.
Finally, the other way to validate and explore your market - particularly if you are interested in discovering how customers might search for your business online - is to go to Google search bar and start typing in your chosen keyword, product, service, or all the problems the customers have, and look at how Google auto-completes the rest of that phrase...
These auto complete results will tell you the top search preferences, top search volumes for what people are looking for, and it'll give you an indication as to what customer priorities are.
And you can do the same process on Amazon too for extra insight.
Market research is an essential part of the business growth journey and validating if your product or service idea will work before you waste your hard earned money on a business venture that no body wants!
By following some of the practical tips above you will gather insight which helps you choose your market. You will begin to understand a little bit more about the volumes and scale of customer demand possible for your business. Time invested in this research phase is priceless. Don't skip this step!