It’s no secret that launching a startup business can be quite a challenge. The fact of the matter is that startup businesses must survive in a highly competitive market while competing against well-funded and well-established companies, which is difficult enough on its own.
Not to mention the fact that startups need viable information to make informed and more strategic decisions that will help them succeed.
That’s where market research comes into play. As a startup owner, you need every bit of information that you can get. Even if you find out that your target audience checks sport news frequently, for instance, you should consider it as a vital piece of information. You never know when such information can come in handy. With that in mind, here are a few reasons why market research is vital for startup businesses.
Helps you identify and understand your target audience
One of the key elements for startup success is determining who your target audience is. Once you do that you must truly understand them so that you can encourage them to buy your products or services. Market research really comes in handy in such situations.
It allows you to learn as much as you can about your target audience so that you’ll know how to communicate with them properly. When you understand your audience's needs and demands, it becomes easier to convert audience members into paying customers.
Helps you understand product/market fit
Did you know that 35% of startups fail because there was no market need for their products or services? Imagine spending years developing something, while investing all the resources at your disposal only to discover that no one is interested in what you have to offer. Now imagine there was a way to avoid such a scenario, in the first place.
Yes, market research can tell you if there’s a product/market fit for your business idea. This type of information prevents you from moving ahead too fast. If there’s no product/market fit, you can always go back to the drawing board and consider another idea before you invest in the one that’s bound to fail.
Gives you a competitive edge
Market research helps you navigate the market the way you’re supposed to. Navigating the online market can be a daunting task, especially for startups that have limited resources and capabilities.
Market research provides insight into market trends, consumer behavior and even competitor strategies.
This information can help you avoid crucial mistakes and help you develop new marketing strategies. Without the right information market research can provide you with, your startup business may fail before you even notice its downfall.
Even well–developed companies that have established themselves in the market frequently conduct market research. The main reason is that information is power in the business world. Without the right information to help fuel your decisions and strategies, it’s next to impossible to succeed in such a competitive environment.