If you're running a shop, then knowing as much as possible
about your customers is essential.
Many successful businesses, shops included, rely on instinct and
experience and they can often be successful as a result; but
nothing beats good, hard data and some analysis to help a business
go forward in the right direction.
Carrying out your own market research is not as daunting as it
may seem, but there are some useful parameters to be
observed.
The first question to get straight is: 'What do we want to find
out?'
Being clear on this point is fundamental to the success or
failure of the research you carry out. If the question is too
abstract or wide-ranging - like 'how can we improve this shop?' -
then the chances of your research throwing up a worthwhile answer
will fail.
Specific questions are easier to assess - What shopping hours do
you find most convenient? Would you use a delivery
service?
The next question is: 'What is it worth to you?'
This question can be approached in monetary terms - how much
cash is it worth spending to answer the question? - or you can look
upon it in terms of opportunity cost, ie, what is it that you could
have been focused on, but will have to sacrifice to carry out the
research.
The main point then is really that market research needs to be
focused on making your business more successful, perhaps by testing
a new product you are considering investing in, or by testing
consumers' appetite for a new service you are thinking of
offering. It could, of course, be aimed at discovering a gap
in the market that you hadn't even considered, by asking customers
what they think is lacking in the sector your shop operates
in.
Alternatively, you could be carrying out fundamental research on
whether opening a particular kind of shop in an area is a good idea
at all.
If your aim is to establish whether your planned shop will work
out, then you should probably start by profiling the area: who
lives there, what are the demographics, is the area predominantly
populated by families, students, elderly people and so on?
Can you ascertain levels of income, what is the competition? What
are the best locations for your proposed shop? Where is
passing trade likely to come from and so on? These are
all questions that you can attempt to answer by visiting the area
and using the internet.
This kind of research can then be extended by asking customers,
either existing ones, or potential ones, about a particular product
or service.
If your shop doesn't yet exist, then leafleting households in a
catchment area is one way to go. You may also choose to leaflet
passers by, or even conduct a street questionnaire. If you have
time and the inclination, you may choose to go door-to-door. A
phone survey is another possibility, but the people you target may
well be more resistant to taking part and generally less engaged in
the process. On-line surveys are useful, but don't offer the
subtlety of one-to-one interaction.
In-person surveys might be accompanied by sample products to
gauge people's reactions and will probably provide a high response
rate - but they are time-consuming.
With a survey, generally, the more people you survey in the
group you are targeting, the more instructive will be your
findings.
The kind of questions you will want to ask will depend very much
on the type of shop you have or are planning and the area in which
it operates or will operate.
If you were planning an artisan bakery, for example, you will want to
establish if there is a demand and where, if anywhere, the
competition is to be found.
Three questions could therefore be: 'Do you buy bread or cakes
in this area - if so where?'
'Would you like to see an artisan bakery in the area
(perhaps explaining the concept of your artisan bakery)'
'How often might you shop at such a bakery?'
While this will give you some useful feedback, it won't give you
much detail. For that you will need to get more organised and
devote more time and ask open questions, rather than the closed
ones above. An example of an open question would be: 'What do
you look for in a good bread shop?'
If you have a shop already and want to trial a new product or
service, there is really no better way than to test it out with
customers. If you prominently display the product and/or
market it, and it sells well, you have your market research.
But you might also like to add some simple feedback opportunities
for customers too. This could be as informal as the customers being
asked about the product, or more sophisticated, like a short
questionnaire.
Beyond surveys and questionnaires, more informal market research
opportunities constantly present themselves. Talking to customers
is perhaps the oldest and most obvious way of gleaning useful
feedback. Ask them what they like about a product, take note
of what they ask for that you don't stock, what would make shopping
at your shop more convenient for them?
By extension, talk to staff you may have who are customer
facing. They may well have plenty of feedback on customers'
preferences.
Analysing the results of whatever research you carry out is
essential. Drawing the wrong, or - more likely - too
far-reaching conclusions, could cost a business dearly. It
may well be that one piece of market research, designed to test,
say, whether a delivery service is viable, may present a 'Yes'
answer. But it may also throw up many other unanswered, related
questions - where is most demand, on what days, for what products,
at what volume?
Of course, market research can't answer every question and at
some point every business must take the plunge with a new service
or product, but it is often a good idea to invest some more time in
digging a little deeper. It could pay dividends in the longer
run.
