Published:

09/29/2011 05:48pm

Why Market Research Will Help Your Business

Do Crucial Market Research For Free, On Your Own

Is market research only for big corporations with deep pockets? No--actually, any business can put simple market research into place, and get about 80% of the benefit of the big, complex, expensive methods--without paying a penny.

In my own one-person business, I've used informal market research to:

Determine where ad dollars were effective, and where they were wasted. As an example, I advertise in several local Yellow Pages directories. By tracking which ads drew how many customers, over a period of years, I've been able to drastically increase the return on my investment, because if an ad doesn't work, I don't renew it. If I weren't tracking, I could still be paying every month for several directories that I tried but that didn't produce for me.

Get crucial feedback on new product development--testing titles, packaging, price points, and even whether a market even existed for products I was considering--that has saved me many thousands of dollars I could have spent developing the wrong things. The title and cover of my newest book, Principled Profit: Marketing That Puts People First, are vastly better than the originals as a direct result of soliciting feedback from many, many people. And the price point, high enough to ensure a decent profit and low enough to sell as an impulse item, was also based on research.

Understand why different marketing approaches were succeeding while others failed. Early market research, for instance, helped me understand back in 1995 why the mall and bulk e-mail models don't work well online.

Let's look at my new book as an example, because it illustrates a number of different types of market research that you can do on your own, without spending any money.

When I got the idea for the book in August 2002, I sent some notes to business and publishing discussion lists to gauge, in general terms, whether there was sufficient interest to do the book. In the past, I'd received lukewarm response to some of the products I was thinking about creating, and this helped me decide to put my energies elsewhere. This time, feedback was very positive, so I started writing. Then I thought I had a great title, but I was feeling unsure about the subtitle. I asked directly for feedback on my possible subtitle choices--and discovered that there were large segments of my target market that absolutely hated my main title. This began a two-month process of brainstorming, narrowing down, putting possible titles out into the world, and rejecting them. Was there a title for this book?

Once I had a title, I had to choose a cover. My designer worked up several very striking, but controversial, designs, and none of them really told the story of what the book was about. Once again, I turned to my online support groups. His covers evoked strong emotions; people either loved them or hated them. (You can see one of his early concepts at http://www.accuratewriting.com/images/prinprofit.jpg>. My goal was a cover that got at least a 60% positive rating from this original group.

After a while, I decided the original focus group had been over-exposed to the concept and was no longer reflecting the market. Fortunately, there are many places on the Internet that overlap with the market for this book--so I picked a new focus group.

Meanwhile, the cover designer selected a concept that is a bit less dramatic, but received about an 80% approval rating--and has a good deal more to the with the book. We went with it. You can see a low-resolution version at http://www.principledprofits.com/TOC.html> (the 31 megabyte final cover in full detail is too big to display on the Web).

It was exhausting, but it was worth it. Of the hundreds of people who have commented on the final title or cover, only one didn't like it. The book is much better positioned in the marketplace, as a direct result of this feedback.

From past experience, I can tell you that the wrong title and wrong cover are very expensive mistakes for a publisher to make. An earlier book that I