The insightful phase..
Whether you are a wholesaler, reseller, or retailer, before you conduct market research it is important that you have knowledge about your business’s organizational structure, and governing regulations. F.ex geographic´s, currencies, tax legislations, languages and your supply chain. Then you will have an in depth understanding of what is needed to get your product to the market, what is needed to meet demand, and how to control costs when fulfilling orders.
So.. what questions do you need to consider when conducting market research or proofing an e-commerce concept?
What is my product/service?
First of all what type of product or service are you offering? What are its attributes f.ex color, size, weight etc? Does it already exist in the form of a known/unknown brand you hold the rights for, or is it a private label you are first to market with? How are you going to position the brand? What is your value proposition? F.ex is it a need, want or luxury product? This will help you define its price point (low cost or premium) and determine its potential profit margin. Is it more likely for a customer to buy your product on its own or together with other products? This can help define how to present your product, f.ex on a landing page or even its packaging. Last but not least what is the minimum order amount you need to place in order to start selling?
Where do I want to sell it (market)?
Which country or region is your market? Do you need to import or export your product? Does it need to be stocked in a warehouse? How will you be distributing your product? Will you be selling via a webshop, marketplace, or social network? Is your offering meant for both online and physical stores, in which case you will need an omnichannel strategy. Try and identify the demands and needs in your market, or missed opportunities, if any?
Who am I selling to (customer)?
Get to know your customers and target demographics. Group them into segments based on buying personas f.ex social groups, income, gender and age. What contact points are available to reach out to your potential customers and begin communicating your message? F.example where do they spend their time online?
Who is my competition if any?
Who and how many competitors are you up against? How are they selling products you have in common? In which channels, and to whom are they selling? What prices are they offering and how much quantities are they moving? Important to know when deciding if there is room for another vendor? How much are they spending on marketing? F.ex what kind of websites refer to them? What channels are they visible in? Always analyze your competition to ensure you have the competitive edge.
Tip of topic: OST (objective, strategy, tactics)
Define your objective (be specific). For example if your long-term goal is to achieve a revenue of $100K you could calculate your “average order amount”, divide it with your “revenue goal” and divide the number by “12” to workout your monthly sales target (short-term goal).
Then make a strategy to achieve your objective. Your tactics can be adapted to stay inline with your strategy. Finally put routines in place to monitor progress.
Questions for feedback:
Are there any useful tools to aid the process of;
1.) Positioning a product?
2.) Researching a market?
3.) Defining customer segments?
4.) Analysing competitors?
Is there anything else that should be taken into consideration when conducting market research, or proofing a concept?
Please leave a reply below to get the conversation going.