(A special note to our nonprofit audience—This article is geared towards the for-profit, small business model. The steps needed for a successful process here are very different than those in the nonprofit arena. Please consult your resources, accordingly.)
Small businesses are the mainstay of the US economy. Here are a few statistics according to Main (2024) in a recent Forbes publication.
- There are 33 million small businesses in the US.
- Over 8/10 small businesses have no employees and are run by a single owner.
- Sixteen percent of small business have 1 – 19 employees.
As such, resources are often very tight for the small business model. As a small business entity, you have to know your market. This includes;
- Your current and potential customers,
- Your competition – direct and indirect, and
- Your industry and current trends.
Having this knowledge will assist you with an effective and efficient marketing strategy to reach your customers. Ultimately, this can help steer you to a profitable position.
The first step is to consider the components of your market.
- Who are your customers? Are there enough to support your idea? These are your target customers. Is there a way to tailor your product or service to best meet their demand? Ultimately this knowledge should include demographics such as;
- Age,
- Gender,
- Income and Occupation,
- Buying Habits,
- Family Status, and
- Hobbies and so forth.
The breadth of your market definition is a bit of an art. The more refined your market, the more likely you will achieve success (Pakroo, 2016). This applies to the B2B model just as much as the B2C model. In this situation, you should consider factors including;
- Industry
- Size of organization to include number of employees and/or annual sales, and
- Location.
- Evaluating your competition is another crucial area to consider. This will help you establish and maintain your competitive edge. This includes direct and indirect competition. Direct competitors are the competitors that target the same customers as you. If you have found a market niche, it may not last too long. Be ready for others to move into this arena. The indirect competition may include those in the same market but have different products or services – and different price structures.
It’s important to stay current on what your customer needs and wants in addition to what the competition is offering. - Industry trends are another area to be very familiar with. Things area always changing in the world of business. If you can incorporate new trends that your competition is missing, you can get ahead of the fray.
When you understand these three areas, you can learn more about your market by undertaking market research. This doesn’t need to be a prohibitively costly experience. A simpler approach using primary and secondary research can provide very enlightening insights.
Your first step is to ask what you specifically want to know about within your market. Primary research may include surveys, focus groups, and interviews. Secondary research focuses on things like trade journals and other publications available in the media.
Don’t forget about your local news!
It’s important to have a game plan in place before the clock starts. Your marketing will give you increased exposure. Be sure you are ready for it.
Market research and solid market strategy will assist you as you assess your demand, your market size, economic indicators, market saturation and the complicated nature of pricing. No one has a crystal ball, but you can be prepared. Be prepared for clients and new attention and demand.
Woodland Strategies, a professional consulting firm in Minneapolis, MN works with a variety of small businesses for their marketing research and strategy. We have experience in a wide range of sectors including agri-business, professional services, and travel and hospitality. We can assist your team with your goals – including an increased customer base, sales and competitive advantage. Get started today! Reach out to us for a complimentary introductory consultation. Small business matters!