Got an idea for a hardware startup? Market research resources will protect you from hitting the market blind, and launching a product which isn’t going to be welcomed. If you launch a product without first assessing the state of the market, then you are leaping before you’ve looked, and the result can be that you end up hitting the rocks below.
While you might believe your product is a going to be a wild success, it’s not going to be good as a business prospect unless there’s a market out there for it. And the only way to know if that’s the case is to do some market research first. It might seem time consuming and inconvenient, but it’s much less so than investing lots of time and money into a product and then learning that there’s no one out there to buy it.
Of course if you’re creating an entirely new category of product there may not be as much data available – but this makes it even more important to do as much research as you can. Suggest looking into Steve Blanks book “The Startup Owners Manual” which goes over customer development in depth or reading “The Blue Ocean Strategy” which covers over how to create new markets.
So with that in mind, let’s explore some useful market research resources…
Examining the Competition
The first thing to do is to assess the competition, and to find out what similar products are on the market and what their growth strategy is. Your first task is to go the internet. A simple Google search goes a long way and you will likely be able to find tons of information about competitors. Second, you can read relevant industry magazines or look on forums and other online communities. Tradeshows, fairs and conferences like HardwareCon will also help you get up to speed and give you an idea of who is doing what in the space. Take a look at which products are selling well, and look at their reviews to see where there’s room for improvement.
For more general information on a range of businesses, you should check out SBA.gov’s Business Data and Statistics Page. This resource will allow you to gain information about specific businesses, as well as economic indicators collected by the government. Here, you can research a wide range of statistics relating to specific businesses. You’ll be able to learn an awful lot about businesses though just by looking at their websites – most companies are happy to share information about their business model, their success, and their goals.
Examining the Market
Likewise, you also need to look at the state of the market to ensure that there are people out there who are willing and able to spend money on your product.
You can do this manually, of course, through surveys using a tool like Survey Monkey which could be emailed out to your network and their contacts, but also by looking at general statistics relating to demographics. The U.S. Census Bureau, for instance, is an excellent repository of information that’s easy to navigate and that can allow you to research specific demographics. Just how big is that market that you identified? This is also great for researching locations if you plan on moving office. Find specific market data too. If you’re creating a handheld games console then research how many of those have been manufactured this year and how many have sold.
Or if you take the advice of the Lean Startup, you should also consider just getting out there and talking to people in the street/conducting phone interviews. If you can build a pretty rough prototype of your idea then go out and talk to as many people as you can to test your assumptions about your idea. Sometime it’s easier for people to imagine something if it is in their hands and not some text on a piece of paper. There’s something different about face-to-face communication that can provide more qualitative data than you could get from any other source.
Again though, an easier route is often just to look at social media. Find places where your target demographic is discussing the products you sell, and you can get a feel for opportunities (or a lack thereof). Using LinkedIn groups to conduct market research is highly recommended due to the high percentage of LinkedIn users who are legitimately interested in business..
Market Research Companies
If all this is sounding very complicated, then another option is to go through a paid market research company. There are plenty of these online which can be found with a simple Google search and any of them will help you to find a lot of relevant information and then put it together in a way that makes sense and makes it actionable. Just to let you know though that you will most likely have to pay to receive these reports. So consider it an investment if you go this route.
As you can see then, market research entails a number of different activities, each of which can help you to get a good idea of the lay of the land before you finalize your plans. The most effective strategy is always to combine these different methods and any others that might be relevant to your specific business model. The better informed you are, the better received your product will ultimately be.
As always, please let us know what you think in the comments section. Which resources do you find most useful for conducting market research? Do sign up to our newsletter to keep receiving other informative topics.