Market Research: The Vital Step for Your e-Commerce Start-up

So, you’ve got the Big Idea, the better mousetrap – time to launch it to the world and watch them beat a path to your door, right?
  
Whoa, cool your jets… before you make that leap, better get the lay of the land first.

We’re talking Market Research – it isn’t only sensible for any e-commerce start-up, it’s crucial.
So, before you blow your seed capital stocking up your warehouse, we recommend taking the time to analyse the market you’re looking at getting into. What you learn will prove invaluable in making the strategic decisions that ensure you create the biggest possible impact and returns.

You should be able to confidently answer a range of questions such as:

- What is the demand for your product?
- Who would your customers be?
- How many competitors would you have?
- Is the market already saturated?
- What are your potential competitors doing now?
- Is there realistic scope for growth?

A good place to start is…

What are people searching for?

Your online business needs to be found in order to function. So, if you can see what people are entering in their relevant searches you can start to form a picture of your product’s viability and demand.

Google’s Keyword Planner provides a quick and easy overview and best of all, it’s free.
Their Keyword Research Tool lets you discover what words and terms related to your product are being searched and how their use changes over time.

It also helps you make selections for keywords that help you stand out against the competition.

You don’t want to use words that nobody would ever search for but you also don’t want to be lost in an ocean of the most generic searches.

As Google themselves say, “The right keywords can get your ad in front of the right customers.”

Google’s site will take you through the steps of how to use their tool but it’s what you do with the results that counts.

You can start to build a consolidated campaign by using them in:

- Your website pages
- Product descriptions
- Meta tags
- Blogs
- Social media
- Even the names of your products

But beware of ‘keyword stuffing’ – that is, deliberately trying to manipulate search results by overusing a chosen word or phrase. As the search bots get ever more aware, they are focusing more on ‘content’.

Google’s philosophy on SEO (search engine optimisation) is that unique, relevant and genuinely informative content will always be ranked higher. Make your focus people rather than the ‘crawling spiders’.

What is the competitive landscape?

Google Trends allows you to see what online search activity there has been by time or region.
You can see data from last year, or the last seven days. Globally or just in your city.

This is a good way to get an idea of how direct or close competition has featured in search results.

You can get valuable insights in how many searches there have been for certain words and whether volumes are going up or down.

What are Industry journalists saying?

Can you imagine starting a business pre-web? We’re all spoiled now, really. At your fingertips you can access a wealth of well-researched, data-backed information to help you make the decisions that count.

There is a plethora of reputable online publications dedicated to providing insights to the budding e-commerce entrepreneur.

Just few that we like include:

- Entrepreneur
- Inc
- Fast Company
- Foundr
- Forbes

You might find the reality-check you need among their regular articles on tips and pitfalls, takeouts from survey results, breaking trends, case studies and more.

What do your potential customers think?

We can’t stress enough how important it is to not only have in mind who you customer is, but what their opinions are. Too many entrepreneurs head off with nothing more than hunches and guesses. You want market research? Research the market.

What better way to find out where their head’s at than to simply… ask them. You’ll have seen this yourself before – a survey.

You’ve probably already broadly defined your target market. Now let’s narrow down some demographic distinctions. Gender, household income, favourite butterfly*, that sort of thing. See how different types of people respond to different questions.

Then pose a few relevant lifestyle questions. Is your product an app? Ask about phone use. Is it a hardware product? Ask about monthly spend on tools. Is it a health supplement? Ask how many vitamins they take. Ask 4 or 5 of the kind of questions you’d be happy to answer. (You could test them on friends)

You obviously can’t ask people about your own product if they haven’t seen it yet so, to try and gauge demand, ask them about their experience with competing products. How did they find out about them? Anything they didn’t like? Were they good value?

Anyone still engaged at this point could be open to you describing your product idea. This needs to be absolutely ‘elevator pitch’ – as brief and compelling as you can. Big picture, short and sweet – low on details, high on intrigue.

Then give them a 5-point scale to respond to:

If the price looked reasonable, how likely would you be to consider buying this product?
1 - not at all likely) to 5 - extremely likely.

To get some real nitty gritty data you can employ the van Westendorp Price Sensitivity Analysis (PSA). To assess respondents’ willingness to buy your product based on amounts they fill in themselves - eg.

At what price would your product be considered:

- Too expensive?
- Too cheap to be good quality?
- Expensive but worth considering?
- Great value?

You can create online surveys for free with platforms like SurveyMonkey using their existing templates. They’ll give you a few pointers and have great reporting tools that make analysis fast and easy.

Get your survey our through your email list or find relevant clusters on social media.
*Maybe not ‘favourite butterfly’…

What’s happening on Social?

We’ve all seen how ready people are to share their views on just about anything on social media. There are breadcrumb trails to follow that will tell you a great deal about consumer perceptions of products like yours.

See how your competitors get found on Instagram and twitter – look at the hashtags and general trends of the overall industry. And of course, see what people are saying – and how the various companies respond.

This is El Dorado of engagement – study it well. This all adds fuel to your later marketing activity, helping you with terminology and tonality you can employ in all your online platforms to grow quality traffic, a loyal customer base and increased conversions.

Where do you get the best feedback? Real Customers

Knowledge is undoubtedly power – but, sooner or later (sooner, we hope), you’ve got to say to yourself, “I feel prepared to go!”

So, take a break from reading the Google reviews of your perceived competitors – and go out and create some competition!

Meanwhile, stay tuned for further advice on creating a successful e-commerce empire.

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