How to Grow Your Business: Part 1 – Customer Research

October 15, 2020
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For many new business owners, getting started is the easy part. Business growth, on the other hand, presents a new kind of challenge. Successfully scaling a business requires more than grit and ambition. You need a well-thought out strategy to grow your business, attract new customers, and retain old ones. How exactly does one do that? The answer lies with customer research. 

Expanding a small business requires effective marketing. If you’re trying to expand your company’s reach to more customers and a more significant share of the market, you need a marketing plan. The first step in developing an effective marketing plan, however, is customer research. 

What is Customer Research?

Customer research studies your potential target customers’ behavior and interests. 

Customer research, also known as consumer research, is about learning as much as possible about the people buying your products and the people you wish were buying your products. 

Why is Customer Research Important?

If you want to bring in new customers, you need to market your company to them. If you’re going to market your company to them effectively, you need to know who they are. Customer research helps you understand your target customers and advertise your services to them more effectively. 

For example, let’s say you want more of your target customers to find you online. You need to know exactly what they’re searching for online. What do they search for, and how can you use Search Engine Optimization (SEO) to show Google that your company’s website is the solution to their problem? 

The more you know about your ideal customers, the more you can tailor your advertising to appeal specifically to them and their needs. 

How to Do Market Research

Conducting market research is a complex process. It’s not just one thing, and it’s not something you ever actually finish doing. Audiences and market conditions change over time, after all! 

Here are a few concrete research methods to guide you as you begin: 

1. Build a Buyer Persona

To fully understand your customers’ needs and the best way to appeal to them, develop a buyer persona. A buyer persona is a detailed profile of an ideal customer. It’s a research tool for helping you to visualize and understand consumer interests and behaviors.

Fleshing out your buyer personas gives you specific information to work within your marketing. What does your ideal customer look like? Are they young or old? Do they live in the city or the suburbs? What sort of jobs do they have? 

Once you know more about the demographics you’re targeting, you can research to find out what else ties your target audience together. Perhaps they tend to be active on certain websites or social media platforms. You could find out if your ideal customers tend to share another specific niche interest. 

2. Target Specific Segments

Your target market needs to be a very specific niche within the economy. While you might not feel comfortable limiting yourself or your products, that’s not what you’re doing. You might still get customers entirely unlike your ideal buyer personas, and that’s wonderful! However, you need to target specific segments of the population so that you can market more effectively.

If you’re trying to market to the whole United States at once, without regard for age or location or interests, you’re going to end up wasting a lot of money on marketing that doesn’t hit the mark. The idea behind targeted marketing is to find the people most likely to respond positively to your advertising. 

What are the specific search terms your target audience is likely to use as they search for solutions to their problem, and how can you use those in your marketing? Google Trends is another powerful research tool for finding unique search terms that may bind a niche market together. 

3. Study Your Competitors

Another reason to target a particular niche market is to differentiate your product or service from the competition. Unless you have an incredibly unique business model, you’re competing for your target buyers’ attention with other businesses in your niche. 

To effectively zone in on your target market, research your competition and find out what sets you apart. Consider your values as a company and what unique edge you can offer your customers that is different from other companies like yours. 

Perhaps in studying your competition and your customers, you’ll find that there’s already a distinct difference in your services or the audiences you serve. If you find that kind of distinction, you can work with it to make it an explicit part of your marketing. 

4. Prepare Research Questions

You want to get real feedback from people as much as possible. That kind of input is quite possibly the most valuable sort of result you can get in your research. One way to do that is to track the way your brand is talked about online. If you monitor your company’s social mentions around the internet, you can track people’s reactions to your brand in real-time. 

You might also want to reach out to your existing customers and connect with them. When you invest in your customers, you gain concrete information about your business and learn how to improve from those already investing in you. 

Create surveys to send out to your customers. Make sure you put a lot of thought into plotting out the market research questions to ask. You might also gather a few customers into focus groups. Then you can do more in-depth interviews with them to find out what they see as the defining aspects and values of your brand. 

Study Your Customers to Help You Define Yourself

Customer research alone isn’t enough to create business growth, but it gives you a solid foundation. By learning everything you can about your ideal target customers, you can learn more about what sets your business apart for them and how you can lean into that. 

Once you’ve gathered all the information you can on your market niche, customers, and competition, you’ll be prepared to develop your brand and marketing plan further. Don’t let up until you see results! 

Ready to move on to the next phase in growing your business? Check out our guide to sales funnels to see how you can build comprehensive and successful sales processes.

This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post. 1-800Accountant assumes no liability for actions taken in reliance upon the information contained herein.