Start-up Bootcamp Day 2: Is there a market for your idea?

What is Market Research? “the systematic collection of information on existing or potential markets for analysis and subsequent action”

Insight “the capacity of understanding hidden truths (especially the character of situation)” Oxford Dictionary Insight = Knowing something others don’t know

Why do Market Research? Test your assumptions Anticipating and minimising risk Understanding potential customers Identify opportunities Discovering your position in the market Banks and other funders require it

What are we looking to find out? Who are my target audience? What do they need? What do they want? What is the best distribution channel? Why they will need/want my product and services? Who will be our competitors? What does your market look like? Size, location, trends

Describe your customers What segments of society are likely to be your customers? Demographics – their age, gender, income, etc Psychographics – their personality type, preferences, values, etc Behaviour – their similar likes and dislikes, sports, hobbies, etc

Locate your customers Find the places your customers are attracted to, whether a physical location or a cyber space where they gather Where do they hang out? What do they read? Both online and offline? What do they search for online?

Customer Profiles Understanding how customers behave and how they spend their money Things to think of when researching a customer base Methods of how to reach them and communicate with them

Customer profiles

Secondary research Desk research or information that already exists Cheaper and much quicker Easy to access Clarifies what you need to find with primary research

Where to look Library – COBRA, Mintel, Keynote Office for National Statistics www.ons.gov.uk Trade Associations & exhibitions www.taforum.org Google trends, web analytics

Pitfalls Be careful how you interpret Beware of out-of-date information Beware unreliable or biased information Statistics can sometimes mask the true picture Don’t make your mind up in advance

Primary Research Collected by yourself Who are you speaking to? Specific to a question or a problem Time consuming Surveys Mystery shopping Product Testing Interviews Focus groups Observation

Top Tips for questionnaire Brief and focused in scope Sensitive and personal to the end Simple and easy to complete Appropriate and jargon free language Narrow from general to specific Anticipate analysis (open vs closed) Flow and cluster questions logically Pilot it Explain purpose at outset Place ‘important’ to the middle

Competitor Analysis Understanding the market Direct AND indirect Unique Selling Point (USP) - Why is yours a more attractive option? Products/services Price Competitor or collaborator? Availability Search for available name, domain name, Trademark and registered company via www.start.biz Reputation Strengths & weaknesses Use Companies House or DueDil (free five day trial)

SWOT Analysis Weaknesses Disadvantages Limitations Strengths Advantages, Unique resources Factors that mean you get the sale Opportunities Chances to improve your performance Opportunities you can spot Weaknesses Disadvantages Limitations What could you improve Factors that loose your sales Threats External trouble for the business Obstacles you face What your competitors are doing

Test Trading Different ways of how to simply test a concept, before committing and investing significant amount energy and resources Steve Blanks - Lean Start up / Minimum Viable Product What have you learnt from piloting? What do customers really want?

Minimum Viable Product

Validation Board

Value Proposition Canvas

Exercise - MI5 groups! Let’s identify a few business ideas in this room which could appeal to the demographic here? Please join the group with the business you’re most likely to be a potential customer of (max 5 ‘customers’ per group) 20 minute focus groups! Questions may include: What criteria is important when buying this product or service? Why / when / where would you buy? What features and benefits are you looking for?

Practical for today Prepare and test your market research survey Next session – 4- 5pm Know yourself and the people you work with