Researching your business idea. Part I.

You can not certify your idea to be a brilliant one, unless and until you have carried out a proper research on your idea. An idea pops up in your mind suddenly when youre busy doing something and you may jot it down onto a piece of paper. But that surely is not enough, not even the dreams that you built around the idea. The important aspect is to ascertain the viability of the idea before you move ahead. And this extra work that you do before starting a business is what will decide the fate of your business, that is whether it will be a success or a failure. With out a market research you are taking a big risk, and your idea may work only if you are lucky enough. But in most cases such idea crash to the ground much earlier than you can expect. So let us begin with a step wise evaluation of the business idea before implementing it.

The conception stage of the idea:

Most beginners find it easy to conceive an idea and imagine the possibilities of using that idea. But what they lack is the capability to research the business idea for its potential. At times what they may see is the multibillion dollar huge sized market and proceed forward without a proper approach as to how they will tap a share of the market. This is all a result of improper planning and the lack of conducting a market research.

This over excited approach is what leads to severe losses and consequent shutdowns. Being passionate about your business idea is good, but you must not loose out on the objectivity aspect. Some beginners also consider spending time on planning and research as a sheer waste of time, and so they leap forward to begin the execution of the project only to realize that they are moving towards losses. This little time that goes into planning and research is the biggest investment you will make in your business. If this phase is carried out properly you will be moving forward with a very calculated risk and would know exactly how to change your course of action in case of adverse situations coming up.

If youre beginning unfocused and untargeted, the business will be a complete disaster.

You must begin by gathering maximum relevant information from the industry associations, internet, specific trade periodicals, and Federal and state agencies. You must not leave any aspect ignored and under searched. You need to build a good understanding of the market and the trends of the industry. You must also understand your customers profile along with details of the product or service that you plan to offer. Market research has been seen as the most invaluable tool to determine how worthy a project is. When conducting a market research, to find out about customer related issues and preferences, try to keep the research population as a wide as possible. You may also want to test the product in a new market, with new types of customers, like if the product is currently being used by the younger population you may want to test its effectiveness for the older population as well.

A research plan should clearly elaborate on the objectives of the research, and should be capable enough of guiding you whether you should go ahead with your idea, make changes or dropped the idea all together. A research would require a proper questionnaire to be framed out along with specifications on the type of answers that you require to analyze the research results. By the type of answers we mean, whether you want an opinion on a certain matter or you want the answerer to choose from within the probable answers that you have listed alongside the questions. To design a research program and to conduct it as well, you can also hire a specialist firm which is into the business of market research.

The requirement of information is highly dependent upon the type of product or service that you wish to deal in and your overall objectives of conducting a research. The research could have multiple objectives like determining the potential market, the kind and degree of competition, at times to determine some useful aspect, or to develop a positioning strategy for the product or service.

The analysis stage:

In the analysis stage you need to test your idea on 4 keys issues which are

The company: you must consider your idea with reference to the products and services, the kind of benefits to the customers, the kind of image the company should have and the main message or the core promise that you intend to make to your customers.

The customer: you will have to research test your business idea for three different types of customer categories:

1. The purchaser is the one who makes the decision to buy or is the one who will pay for it.

2. The influencer being the people who influence the decision of buying a certain thing such as family members, friends, organizations or some community groups.

3. The consumer also known as the end user is the person who actually uses the product or service but he surely may not be the buyer him self.

4. The competition: your business may face competition at three levels the primary level, the secondary level and the tertiary level. So you will have to find out ways to beat the competition at each of these levels with different strategies and different messages reaching your customer.

5. The collaborators: these are organizations or people who would be interested in your success but to do not get any direct payments for any success that you realize, in this category fall people or organizations such as your advertising partner, the media, the distribution agencies Etc.

We shall continue with our discussion on research methodology in the second part of this article, where we shall discuss some more issues related to competition, the result of the research and things before implementation of the idea.