One of the biggest mistakes any small business owner can make is to fail to understand their target market. Before you start spending all your time and money dedicated to one target niche or product, you need to do some thorough market research. Don’t even begin to create a business plan until you’ve done the following:
1. Find a Solution to a Problem
When you know the problems people are facing in your target market, you can create solutions. Solutions sell. Look at the questions people are asking and why they are asking them. Look for the places your target market hangs out, like forums or Facebook groups, and lurk there. Watch the discussions that take place and the questions asked. If there are problems that people consistently talk about, you’ve just found a great opportunity to provide a solution. Your next step is to find a market that is ready and willing to pay for your solutions.
2. Who is your Ideal Client?
It helps to paint a portrait of your ideal customer in as much detail as possible. This isn’t necessarily a visual picture, though some people do that, but one that describes little details about them. What are their demographics, such as age, gender, occupation, where they live, etc? What is some of the lingo they use? Do they tend to have similar interests or hobbies? Write it all down. Some marketers even keep this list in front of them whenever they write anything for or to their customers. I like to create a little story about my target market, so that I can really relate to her.
3. Keyword Research
Keyword research is the first step in creating your online business hub. It helps you understand what people are searching for online and what words they are using. There are numerous tools that can help you do this research, including Google’s own AdWords keyword tool, a free and paid tool from Wordtracker, and a popular software program called Market Samurai. It takes a little practice to learn to do keyword research well, but knowing the most commonly searched terms will help you target the problems that people are facing. It also means you can optimize any content you create, helping it rank in the search engines. I also recommend spending time on forums or websites where your target market is… watch and listen, you can discover a lot about your audience and be able to engage them in their words.
4. Who Are Your Competitors?
Know your enemy! Well, they aren’t really your enemy, but you need to have a full understanding of who your competitors are so you know just what you need to do to be successful. Identify your biggest competitors by looking at who else is selling solutions when you search for answers to the problems your market has. What are they selling? Where are they selling it? What kind of language do they use in their sales copy? How does one competitor differentiate themselves from another? What are the prices of their products and what kind of backend sales do they do? You can become a customer of some of your biggest competitors and literally “stalk” them by learning their sales process and the types of emails and follow up they do. This will give you ideas on what you can do to compete with them. It is hard to believe but knowing there are 4-6 competitors in your “solution” area is actually a really good thing, you know that people will actually pay for the product and/or services that you want to offer.
While it can take what seems like a lot of time, market research can save you from sinking a fortune in time and money in a doomed venture. The more market research you do from the start to understand your market, the less risk you face and the more successful you will be. Building a solid foundation allows for strategic growth.