The Startup Essential No One Talks About: Consumer Market Research
Every marketer knows that customer insights should form the foundation of their product and marketing plans. Yet when I talk to marketing leaders at startups, they tend to balk at the idea of devising and executing thorough market research plans given resource constraints.
Here at CommonBond, a leading student lender, consumer market research is critical to our company’s success, and the marketing team is the driving force behind our research strategy and execution. Research enables us to gather insights from a broad customer base – folks beyond the group we have affectionately internally named “CommonBond superfans.” Access to real data through structured research has enabled us to:
- Identify customers’ unmet needs for new and existing products to ensure our teams are executing on the priorities that truly create value.
- Test customer messaging to ensure language used in collateral truly resonates with the target customer.
- Understand the competitive landscape so we can innovate and stay relevant in the crowded higher education financing marketplace.
If you believe that research could be valuable to your startup, then the next hurdle is figuring out just how to conduct it in a resource-constrained startup environment. Here are a few tips that have made us successful:
Map out your market research plan.
Your market research plan should begin with an understanding of your research goals, which should support your company’s overall objectives. Once you document your research goals, there are three additional critical elements to your plan:
- A cohesive timeline: Document when you will perform each phase of research and any linkages between the phases. Ensure that you have a strong handle on how long each phase will take you and how you’ll use the output.
- A sampling plan: It’s critical to understand who you are going to communicate with through your research – that is your sampling plan. A sampling plan requires you to make two main decisions: who and how many. Understand whose thoughts and opinions you’re eager to understand. While this is likely your target market, be as specific as possible when identifying who you want to respond to your research. Document the ideal respondent’s characteristics, including age, gender, occupation, income level and any other applicable factors. You should aim to have as few as eight respondents, but you may require as many as 15. It’s important to use a sample size calculator to understand how many responses you need.
- Your research methodology: There’s an almost unnerving number of research methodologies to choose from. This can feel overwhelming if you’re running a research study yourself, especially for the first time. I would recommend starting with in-depth interviews to gather qualitative data or a survey to gather quantitative data because these tend to be the simplest types of studies to pull off in a resource-constrained environment.
Develop the tools you need to execute your research plan.
Once you have documented your research plan, you need to execute it. The tools you need to run a qualitative study are fairly different from that of a quantitative study, but we’ll discuss both because both types of research are foundational.
- Qualitative market research: To effectively conduct qualitative research, you’ll need a discussion guide. A discussion guide is simply a guide for you, the moderator, as you lead the interview. A strong discussion guide includes an introduction, questions that allow you and the respondent to get to know each other and then the questions that enable you to get the information you need to complete your study. The guide will serve two purposes. First, it will enable you to keep the interview on track, ensuring you’re asking the right questions to gain the insights you need. Second, it enables you to identify when an interviewee isn’t a good fit for the study so you can kindly cut your interview short, or try to gain other unrelated insight from them.
- Quantitative market research: To effectively conduct quantitative research, you’ll need to create a survey through a survey tool provider. Startups should consider tools offered by companies like SurveyMonkey or Qualtrics, though there are a number of other tools for small and large companies alike. Once you’ve determined which survey provider to move forward with, you need to build and program the survey yourself. Similar to a discussion guide for qualitative research, I recommend documenting your survey before building it in the survey tool itself. This enables you to iterate on the survey questions outside of the tool. A strong survey will include an introduction, screener questions to ensure only the right individuals are taking your survey, the survey questions themselves and a conclusion.
Set aside time to conduct the survey and analyze the data
After you conduct your research, make sure you are setting aside time to analyze the data. Consider framing your analysis by connecting the dots between:
- The data you gained.
- The insight it drives for your company’s business.
- The decisions it should impact.
Framing the survey results in this way enables your team to understand how your work can drive meaningful change throughout the organization.
Whether your startup is in its infancy or has been established for several years, consumer research is critical. It is the simplest way to gather the reliable data you need to make sound business decisions. While it may seem like a daunting process, consider it an investment in your company’s future. Making data-driven decisions based on consumer research today could improve your company’s strategy or products, enabling you to save time and money in the long run.