Market research is one of the best investments any start-up can make for success. History has proven consistently that a deep understanding of your market can sometimes be the sole differentiator between a successful and unsuccessful business. “Without data, you’re just another person with an opinion.” said statistician, author and one of the Founding Fathers of Total Quality Management, W. Edwards Deming.
This holds more gravity than ever now as start-ups increasingly blur the lines of geographical boundaries. A start-up in New Delhi, India, could solve a problem relevant to audiences in Canada, US or Germany. However, many start-up founders pride themselves on making decisions based on a gut feeling, and many have been accused of functioning within a bubble of yes-sayers. These habits could result in poor product-market fits and ineffective expansion journeys.
How Market Research Should Direct Your Start-up Expansion
At the crux of it, market research helps you decipher whether your product or service has a market at all. It can inform numerous vital decisions in your Product Development, Pricing, Distribution, and Marketing Messaging strategies. Here are a few objectives you can bookmark to plan your market research goals:
- Learn the size of the market, and its growth rate
- Find out local government grants, funds and other business resources
- Track industry trends and how they can impact the demand and supply in your industry
- Find out more about your competitors in the market. How are they doing?
- Identify potential customers and understand their demographic profile
- Determine price points for products and services based on consumer responses
- Discover the best distribution channels for selling your product or service at optimal prices and volumes
Primary Market Research for Start-Ups
A Plethora of methods exists to conduct primary research across borders today. Primary research involves businesses deep diving into data collection on their own with uniquely defined objectives instead of depending on data collected by third parties like governments and research agencies.
Previously, primary research was considered time-consuming and expensive, but digital primary research methodologies have made it easy.
Types of Primary Market Research Tools and Resources in North America
Online surveys are an extremely convenient way to gather large numbers of responses to your questions. You can place your surveys on your website and use Social Media, Email Marketing and Google ads to draw in the respondents. They are incredibly cost-effective and don’t need much time or resources because of the array of plug-and-play tools available.
The new trend of Gamification, used very often by marketers to collect data, has also reduced the acquisition cost of data collection. For example, instead of publishing a formal survey to discover a customer’s vegan food consumption habits, you could create a quiz or an interactive form that masks survey questions as a fun quiz or game. In the process, your potential customers feel entertained while the brand can collect their preferences. Companies also incentivize users with rewards to reduce the barriers to form submission.
A more time-intensive and personalized method of gathering information but equally essential to understand the nuances of consumer behaviour, which may not be apparent in quantitative research such as online surveys. Interviews allow you to get more detailed information about your customers and their needs. You can use your website, social media groups, networking groups, email marketing and google ads to identify interviewees. Although this requires a lot of human resources, unlike before, it doesn’t require much physical one-on-one anymore. Video calls with potential customers will also help you read between the lines. Many market research companies take on one-on-one surveys and would have trained interviewers for this purpose.
Observing customers or prospective customers allows you to see how they behave in a store or with a product. For example, suppose you are visiting Toronto for market research and belong to an industry like F&B, Retail. In that case, you can locate similar competitor spaces where your audience may be and observe their actions and behaviour. This is also a cost-effective method of primary research, but often the why is left unanswered unless someone agrees to be interviewed by you. The online version of this primary research can also be found in reviews and comments on social media content.
Focus groups involve bringing together people with similar characteristics (age, location, income level, purchase behaviour) to discuss issues related to your business or product line in an informal setting led by someone trained in qualitative research methods. This is another qualitative method of research that can throw light on many insights customers rarely reveal in one-on-one interviews or online surveys. Brands can quickly understand the ‘why’ behind decisions, reactions or purchase behaviours.
Secondary Market Research for Start-Ups
Secondary Research involves data already collected by a third party relevant to your industry, product or service. Secondary market research provides an essential zoomed-out insight into designing a start-up launch or expansion strategy. Primary research goals are often built out of hypotheses created out of secondary research.
Types of Secondary Market Research Tools and Resources in North America
As the start-up ecosystem booms in North America, entrepreneurs worldwide need to know where to look to find the research data they require.
- Business Development Canada’s (BDC): BDC is a Canadian bank for entrepreneurs. Apart from great funds and loans for start-ups, they also curate analysis and research about Canadian markets relevant to small and medium-sized businesses.
- Statistics Canada: Statistics Canada is the official website of the national statistics office of Canada. Their website has data and statistics related to the economy, society and environment.
- Canadian Official Website: This section is managed by the Canadian Industry Statistics department on the government website. It pulls out only key information from the Statistics Canada data and showcases them by industry. This is an excellent place to start if you want a quick summary or snapshot of GDP, Industry Trends, Labour Productivity, and Trade data.
- Business Improvement Association (BIAs): Canada has BIA members across the country; these BIA Members are a group of local businesses tied together by the area they are located at. They are a not-for-profit group that curates fantastic information about local businesses in their area. It also lists federal assistance programs applicable to the members in the area.
- Industry-specific data could be found on trade news and industry-specific websites like Fintech Times, Healthcan, Canadian Manufacturing and Canadian Food Business.
- Other secondary research resources consist of reports available for free from companies like PWC, KPMG and MarketResearch.com
- A fundamental competitor analysis can also be conducted with a detailed inspection of Google reviews and Social Media pages.
Market Research is both a science and an art. It can be put together in many different ways and with budgets. Market Research budgets can start from a few hundred dollars using plug-and-play tools and a lot of man-hours and can stretch up to thousands of dollars if the business needs are very specific. Companies that need to invest more funds to start up or expand generally prefer to spend more on formal market research agencies to ensure they extract the best data. The above resource and tips should help you streamline your market research efforts before starting or expanding your business to North America.
Do you want to explore expanding your business to North America?
TBDC, a government-designated partner for the Start-Up Visa Program based in Toronto, is the perfect starting point. Their Soft Landing Program is specifically designed to help international entrepreneurs start up and scale to international markets. Reach out to us to book a call.