How to Do Product Market Research
To avoid being part of the 42% of failed small businesses that offered unwanted products or services, you need to know what to bring to the market that will sell; you need to know how to do product market research. Product market research is a critical part of product development. It helps you understand your customer base and determine which features will appeal most to them. To go over how to do product market research, we’ll go over:
- Determining what consumers want.
- Understanding why people buy.
- Creating a product that meets needs.
- Testing the product with users.
Why Do Product Market Research?
Avoid Disaster
Nothing is worse than working hard on designing, creating, and shipping products that turn out to be unwanted and unbought; they just end up laying around warehouses. Doing market research will give you an idea of what is already on the market and what consumers actually buy, reducing the risk of your product being badly designed or badly marketed from the start.
Fine Tune Products
So you have a basic idea of the products you can make, sell, and make a profit on, or you already have products that sell alright. How do you make them better, more attractive to customers, or just more efficient? Find common issues and pain points in the industry and with competitors products; then implement solutions and features that solve those issues. Additionally, you can use your research to tweak prices and descriptions to compete with successful competitors.
Discover Opportunities
Use product market research to find possibilities for new products and services or advancing existing ones in unexpected yet desired directions. You can also combine items that are often bought together in bundles to encourage upsales. This will lead to both more desired products and more orders in total.
How to Do Product Market Research
Determine what people want.
To do product market research, you first need to identify your main target audience. You need to understand who your customers are and what they want. You should also consider their demographics (age, gender, income level, etc.) and psychographics (interests, values, needs, wants, etc.). Once you’ve identified your target audiences, you can use surveys to learn more about them.
From this you should start making a user persona for each main target audience. This should be a fictitious person that represents a specific group within the target audience that you are trying to attract. You’ll need to know the target audience a bit better to finish the persona, such as why they are patroning you in the first place.
Understand why people buy.
By conducting both product market research and consumer research, you should study the motives of your main consumers. What are they trying to accomplish or what is their end goal? It is not to buy your product; it is to solve a problem or satisfy a need they have. Also, you should look into why people prefer some products and brands over others. Is it their range of products, their customer service, their specialization, their values? What makes people not only interested but get out their credit cards and actually buy the item or service?
Create a product that meets customer needs.
To determine whether your product meets a consumer’s needs, you must first identify those needs. This requires understanding the wants, needs, and desires of your potential customers. You can do this by interviewing them, asking questions, and observing their behavior. Once you have identified their needs, you should consider the following four questions when designing or redesigning your product:
- What problem does the product solve?
- Who is the ideal type of user of the product?
- What features or additions would make the product better?
- What price point would work best, both for us and the users?
Test your product with real users.
All plans go awry when put into the field. Test your products with actual people (preferably from the main audiences of the product) before they get there as well as after to check for unforeseen issues that users have with the products. You can do this through A/B testing, User testing, conducting surveys, and making user journey maps.
If you’re not sure where to start, try testing your product with real people. Ask friends, family members, colleagues, and acquaintances to test your product. They will help you find out what works well and what doesn’t. (Small baked goods or $5-10 Starbucks or JimmyJohns gift cards are great incentives!)
Recap
Product market research is an important part of product development. It helps you understand your customer base and determine which features will appeal most to them. To go over how to do product market research, we’ll go over:
- Determining what consumers want.
- Understanding why people buy.
- Creating a product that meets needs.
- Testing the product with users.
