Katey Ferenzi
This is the fifth installment of the #SellMore Small Business Boot Camp series. In previous parts, we discussed how to find a product niche, how to source your product, how to evaluate your small/online business idea and how to address online business laws and nuances. This week, we’ll be covering how to assess market demand for your product or service.
Conducting market research for your small business idea is not only wise, it’s essential. Taking the time to go through this process will help you uncover whether or not there is a healthy demand around your business idea. No matter how stellar you feel your idea is, you’ll want to spend some serious time evaluating market demand and gathering hard facts before you order 2,000 product units or sign any contracts.
Watch this week’s video to ensure you’re using your start up capital strategically.
When completing market research around your small business idea, there are several different methods you can use. However, it’s always great to use a combination of tactics to be certain you have an accurate picture of your market and make the best business decision possible.
Conduct Keyword Research: It’s Easy, Fast, And Free
Looking for a super easy, fast and free way to get a feel for your product or business demand? No problem. The Google Keyword Tool helps you visualize how many people are searching for your business or product idea during any given time period. An added bonus is that this tool will provide you with various related keywords which can help you generate ideas around which words to use in your product name, descriptions, blog posts, and your website as a whole.
Conducting keyword research and then optimizing your store for search engines will help drive quality traffic to your online store. These days, everyone uses search engines to find what they need and if no one is searching for what you want to sell, that’s not a good sign. On the other hand, if thousands of searches are being done for keywords closely related to your product, you might want to do some more research and take the next step sooner rather than later.
A special note: Google has gotten wise to entrepreneurs using this tool to conduct keyword research for their online businesses. When you go to create an account with Google Adwords to start using the Google Keyword Tool, you will be prompted to start an account, enter a dollar amount and possibly even enter credit card information. Don’t panic. Go ahead and enter in $ 1.00. You will not need to start an actual adwords campaign at this point.
Find Google Trends: Put The Big Picture In Perspective
Another cool Google tool you can use is Google Trends. Do a search for a product or business idea and then view the search volume for that keyword throughout the past few years. You can also compare the volume of searches between a few terms, see geographic information and even view how particular events affect search popularity.
Tap Social Media: Learn The Language Of The Land
Examining social media is a great way to start understanding the volume of conversations and mentions around your business idea. Social media also helps to uncover aspects of your target market you can use within your marketing tactics later on.
By probing into all of the different social media channels out there, you’ll start to identify how potential customers talk about your product or industry as a whole. This will help you learn their language so you can leverage it later via your product descriptions, blog posts, ads, social media, and promotions. Using the language of your targeted customer will help to drive quality traffic to your site, build a loyal customer base and increase conversions.
First, take a look into hashtags and what’s trending overall. As far as some tools you can utilize to examine different social media outlets, try out Topsy, which will search for the volume of tweets per day that contain a word or set of words. Also, there are several social analytic tools with competitive elements that can help you learn more.
Build An Online Store: Test The Waters & Gain Momentum
Dive in and open an online store. You can do this long before the product or service is ever developed to simply start driving traffic or even work to collect some pre-orders. This tactic can help you gain immediate feedback from your target consumer or gauge demand for your product before manufacturing or buying inventory.
Simply create some ads on Google and Facebook and spread the word via word-of-mouth. You’ll be able to start attracting potential customers who can provide feedback, insight, sign up for your mailing list, or be placed on a waitlist to be notified when the product has launched. The investment community will more likely give money to a company that has shown proven market demand by collecting pre-orders or signups from real consumers.
A word of caution: make sure your website is clear in communicating that your product or service is not ready to ship. Also, provide an estimated date for release and details around whether or not you will provide refunds. You’re not trying to take people for a ride, you simply want to test the waters and gain momentum to carry you to the next step.
Leverage Your Networks: Get A Temperature Check
Leveraging your digital networks including your Twitter, Facebook, and Pinterest followings along with your real-life sampling of friends, family, and acquaintances is a must. These folks and followers are all potential customers who are quite safe for helping to gauge interest in your ideas, fulfill some test orders, and gain valuable feedback at every step of the journey.
Also, make sure to let your networks know you want the real, honest feedback, not that sugar-coated stuff that serves no purpose to you.
Scope The Competition: Get A Lay Of The Land
Although we’ll be talking about how to identify your competition in a later #SellMore Small Business Boot Camp post, you’ll definitely want to take a look at your competition at this point in time to get a lay of the land. Here are a couple questions to start you off:
- Is there a clear owner of the space?
- Is the market saturated with competitors?
- Can you spot a weakness in the competition that you can take advantage of?
Don’t get discouraged if the market feels full at first glance. This just means you’ll want to take a deeper look to see if each site is actually performing well or if there is an opportunity for improvement. So often those businesses that come to market first make mistakes in the uncharted territory. Think about MySpace and Facebook or even Yahoo and Google.
Often, the second-comer wins the customer’s loyalty.
Google It: Work Smarter, Not Harder
This may seem obvious, but many potential entrepreneurs don’t search for market data or surveys on their industry or even on a specific online business idea before launching. By completing just a few quick searches, you can end up with a vivid picture of the market opportunity for your idea, which will help to justify or trash your proposed product.
Crowdfunding: Raise Money, Generate Buzz, And Gauge Interest
It’s always wise to raise some dough before jumping into your next entrepreneurial adventure. Better yet, there are many platforms out there designed to help you start generating funds, build buzz and get an overall temperature check on the level of interest around your business idea. Check out Indiegogo, RocketHub, Peerbackers, and Kickstarter, to name a few with great reviews and track records. If these don’t seem to meet your needs, there are tons of options for crowdfunding. It’s just a matter of finding the best option that suits your specific needs.
We’d love to hear from you! Tune in next time as we continue to dive into specific areas that tend to get folks hung up when starting an online store.
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