Thursday, March 10, 2011

How to Do Market Research for Your Home-Small Business Idea

SUCCESS SECRET #13: Learn how to market research for your home business idea to determine if there are potential customers.

Finding Your Customers; Your Niche
     No matter what business idea you consider, if you do not have customers for your service or products, your business cannot succeed. To determine this you have to identify your target market—the customers most likely to patronize your business—and if there is a “niche”—some service or product that is not yet being provided to your target customers.
     Establish parameters of your Target Market by asking the following:
1) What are their demographics?
2) What are their needs and requirements?
3) What benefits do they want?
4) What are their concerns about your type of product or service?
5) Who is your competition?
   Knowing your Target Audience will minimize the risks of doing business. It will uncover and identify potential problems. It will help you recognize opportunities in the marketplace that otherwise would be missed. It can save you time and money by focusing your energy on the potential BUYERS.”

How To Analyze Your Competitors
     In your quest to find Target Customers, you need to analyze your competitors and what they are and are not providing their customers. Here are some suggestions:
1) Study their advertisements to see which services or products they are pushing. Get copies of their promotional materials. Then see if there is a service or product they do not provide.
2) Do informal surveys of your target customers at business trade shows or events, or via the telephone, flyers, word-of-mouth, ads in the newspapers or direct mailings with response cards.
3) Test a product and or service similar to your competitor’s by offering a free consultation or sample and then ask for feedback about its quality.
4) Be bold and honest and contact your competitors directly and ask them if there are customers’ jobs that they cannot or prefer not to handle. My husband and I who did lawn care on the side a couple of years ago discovered a niche of mowing the tiny lawns of townhouse owners. We received the tip from an owner of a large lawn and tree care business. He told us it was not worth his time to mow small lawns and preferred to mow business sites. We had more business than we could handle mowing these little lawns!
     Call your competitors, and tell them you will be grateful for any smaller referrals and that you are worthy of their recommendations.

How Be Smarter Than Your Competitors
     No matter what business you start you are likely to have competition from other businesses for some (or all) of the same customers. Here are some tips to help you get an advantage:
*Be available more hours or at times when your competitors are not. For example, a child care business has hours on weekends or some evenings for parents who are students or work evening shifts.
*Surprise your customer with little extras. Provide free estimates with no obligation. Send them thank you notes or congratulatory cards on special occasions. Offer them special sales. Sue, who has a home-based salon offers refreshments and free handmade ornaments to all customers during holiday seasons.
*Be honest with your customers. If you made a mistake, take steps to rectify it. Tell them immediately if you cannot handle a certain request and have a list of others they can call. When we did the lawn care, we also had requests to rototill gardens or trim trees. We did not have the equipment to do that, but we did have a list of other recommended business owners who performed those services.
*Treat all customers with respect. You do not have to like every customer, but you do have treat them as persons and with professionalism and common courtesy.
*Communicate! Be available for your customers and be sure to get back to them promptly if they have a question. A lawyer with a home office says, “I often answer my own business telephone even though I have a secretary. My clients are surprised and pleased that they can often talk directly to me.”
*Let them know if you are having a problem completing a project. Make sure you understand exactly what the customer wants—do not assume anything! Send out “customer report cards” for their feedback.
Next: "Before You Quit Your Day Job"

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