The Amazons and Apples of the world can afford a trial-and-error approach to launching new ideas and concepts. However, even massive entities do extensive market testing; they can afford errors in judgement, but they still want to avoid needless losses.
Maybe you’re just considering starting a new business, or your young business still resides in your garage. To grow out of that garage, you have to take risks by implementing new ideas. You cannot fully mitigate the risks, but you can take action to reduce the severity. Here’s a simple key: before going full steam ahead, ask someone.
People’s Opinions Are Like Focus Groups
You probably understand the concept of focus groups; you may have participated in a few of them. On the off-chance that you’ve been sheltered from the experience, however, it all boils down to groups of people who are invited to share their opinions. In many cases, those people receive some form of compensation, such as cash or gift cards, which entices them to participate.
Participants often physically attend within an in-person setting, but online groups are becoming increasingly common. Whatever the venue, carefully-worded questions can involve anything from politics to specific products or services.
Whatever the subject matter, the point is to find out how most people think, what they want, and how to reach them in the real world.
Avoid Asking Questions on the Fly
Wording matters. Responses will be very different, for example, if you ask, “Are you a dog person or a cat person?” versus “Are dogs much better companions than cats?”
If you want accurate results, rather than those that echo your own beliefs, you have to know precisely what you need to ask — and use the same wording and intonation each time that you ask a question. You might even want to do a test of the test by running your questions past several people before you begin conducting your survey.
You also want to consider what types of answers you want. For results that are easiest to tally, you might want to ask yes/no questions, such as the following:
- Are you likely to buy these goods/services? If the answers are consistently negative, then you might want to reconsider moving forward with the venture.
- Do you know other people who would be interested? Even if you receive positive interest in an idea, this might be a good way to identify if you can expect larger market interest.
On the other hand, if you want full-throated opinions, and you’re willing to spend the time needed to analyze the responses, then essay-type questions are also appropriate, such as:
- What properties would make the idea most attractive? Color choice or flexible use options might be important when developing your product. Customization or collaboration might be essential properties when providing services.
- What type of advertising message would make you more likely to buy? If you pay attention to insurance commercials, you may notice that they tend to have different slants. Some focus on claims support, while others talk about flexibility and affordability. The answers to this question can help you target the right audience.
- What types of marketing materials would be most effective? TV and radio advertising might reach your biggest audience, but not necessarily. Health-related print and online magazines may be better ways to sell your herbal products. Surprisingly, direct-mail might be the perfect way to reach customers. Financial services businesses, for example, are reported to spend about $20 billion per year through prospective-client mail boxes.
In other words, formulate your questions with an eye toward the types of answers that you need to receive. Yes/no questions are great for telling you if moving forward with an idea makes sense. Essay questions are more likely to help you identify reasoning, and they may also provide you with ideas that you have not yet considered.
Identify the Right People
Getting feedback from friends and family might be a reasonable starting point, as long as you consider how honest they would be based on your relationship. Some people might be over-complimentary; others may have personal reasons why they don’t want you to pursue your new venture.
The best people have a natural interest in your products or services, and they come from the following groups:
- Potential future customers: These are the people whom you want to attract, so their interests matter. They may be individual consumers, or they may be experts that you want to sell to. For example, mechanics might take an interest in your new tool.
- Field experts: These people can help you identify unexpected challenges that you may face. For example, if they know that all automotive measurements are moving from the Imperial System (used in the U.S.) to the Metric system within a year, you definitely want to know this before you develop that new tool.
Negative Responses Are Not Always Game-Changers
Don’t be discouraged if you get more negative responses than positive ones. In many cases, they are signs that you need to alter your idea, rather than eliminate it. Maybe they really don’t like the product color choices. Perhaps they feel like your proposed services won’t allow enough customer collaboration.
As long as you get explanations for those responses, you can address the issues to get to idea acceptance. Remember that responses from the most passionate naysayers can teach important lessons. Fix the issues, and then re-test the idea until survey respondents say “yes.”
Up-Front Research Can Reduce Losses Down the Road
You probably know that the statistics on new business or product success rates can be discouraging. In many cases, new businesses fail for a simple reason: there is no market for a seemingly great idea. You can increase your odds of success by checking the market before you invest money and effort into the real work.
There are, of course, other ways to pre-test your ideas. Even an Internet search can give you valuable ideas about what the marketplace seeks. Still, there is nothing like conducting one-on-one research to gain important insight into the wants and needs of future potential customers.