{"id":4564,"date":"2016-04-04T10:47:33","date_gmt":"2016-04-04T15:47:33","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/smallbusiness\/business-operations\/how-to-conduct-primary-market-research-for-your-small-business.html"},"modified":"2024-06-06T02:24:45","modified_gmt":"2024-06-06T07:24:45","slug":"how-to-conduct-primary-market-research-for-your-small-business","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/how-to-conduct-primary-market-research-for-your-small-business.html","title":{"rendered":"How to Conduct Primary Market Research for Your Small Business"},"content":{"rendered":"\n
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Conducting Primary Market Research for Your Small Business<\/h1>\n
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\n By Susan Buckner, J.D.<\/a> | Legally reviewed by Aviana Cooper, Esq.<\/a>\n | Last updated\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

If you’re a small-business owner or planning to become one, you probably have a great idea for a business or product you haven’t seen on the market. Before you leap into the business arena, you should do market research on your plan.<\/p>\r\n

Nearly half of all startups fail within the first five years<\/a>, according to the U.S. Department of Labor’s Bureau of Labor and Statistics. Two big reasons for these companies’ failures are being in the wrong market and failing to research their product. Market research helps determine the demographics of your market area, identify competitors, and develop a marketing strategy<\/a>.<\/p>\r\n

There are two types of market research methods: primary research and secondary research. These methods can help you identify your target market for a new product or business before bringing it to the public.<\/p>\r\n

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Primary vs. Secondary Market Research<\/h2>\r\n

You should use "secondary market research" first. Secondary research uses information from general sources. Trade journals, chambers of commerce<\/a>, and similar sources provide statistics and market trends. You need the other kind of market research for information specific to your business.<\/p>\r\n

Primary market research focuses on your business needs. Specific questions about your new business or product go to a target audience<\/a>. Their responses tell you what your market thinks of your product.<\/p>\r\n

Performing Primary Market Research<\/h2>\r\n

A professional research company can perform your primary market research, or you can do your own. Professional research is expensive, but crafting specific research questions and surveys takes knowledge of research tools and competitive analysis. If you’re unfamiliar with those terms, you should have professionals do your market research.<\/p>\r\n

If you’re comfortable conducting primary market research, one of these methods works best.<\/p>\r\n

Surveys and Questionnaires<\/h3>\r\n

Market research surveys and questionnaires gather information about potential customers. Survey questions should follow your business plan, so think about what you want to achieve before writing the questions. For instance, if this is a new product roll-out, your questions should be about pricing and customer needs. Do your customers want this new product? Do they already buy such a product from someone else?<\/p>\r\n

You can distribute surveys and questionnaires in the mail, by email, on social media, or even by handing out flyers at a public event. Online surveys have the benefit of an immediate response and are easy to create. They are also subject to trolling<\/a> and jokey replies, so you need to be careful in interpreting the response.<\/p>\r\n

Before you send anything via email, you should obtain legal advice. In 2003, Congress passed the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 (CAN-SPAM Act<\/a>). The CAN-SPAM Act puts tight restrictions on "advertising" in unsolicited email. Marketing surveys can fall under the act if they are not worded correctly. Consult a business attorney before sending your questionnaires.<\/p>\r\n

One-on-One Interviews<\/h3>\r\n

In-depth interviews can be time-consuming, but they are an ideal way to gather information from a small group of people about an idea or market. You can get different types of information depending on the people to whom you talk:<\/p>\r\n