Importance of Market Research for an Entrepreneur

"It is better to fail a hundred times on paper than failing once on the ground."

These are the opening lines of the chapter on market research of my book First 1000 Days of Startup. They say if you fail to plan then you plan to fail. In my immense experience as a start up mentor, investor and business coach I have seen numerous bright ideas going to the gutter because of lack of planning and research.

The best part of my working hours presently is spent guiding budding entrepreneurs. The first piece of advice I give them is to research their niche thoroughly from every possible angle. This is the foundation step for launching a successful startup.

See the startup journey is one of the toughest types of business adventure that you can do. With only 2% of startups managing to attract investments, running out of funds and your business going south is a brutal reality, have no doubts about it, complete awareness about what you are entering into is vital.

As in School - As in Life

Everyone of us has attended school and college at one time of life. We can take a small cue from that phase of life to understand the importance of market research for an entrepreneur. Those who never did their homework properly are often punished! Same is the case with running a business. If you don't do your homework (research) well then you are certainly going to stand out of the classroom with your hands up.

Well I guess that's enough of a premise for the article, now I will come directly to the part that matters. Here are the reasons why an entrepreneur should invest his energies into market research.

  • No matter how knowledgeable you are, always begin with a premise that you don't know anything - that's important because your idea may or may not be relevant as per the marketing demands by the time you intend to launch it.
  • Your target audience is dynamic, their taste and needs changes from time to time. Solid market research is the only way to know the band in which their preferences might fluctuate - this will help you calibrate your service/product into something that is widely accepted.
  • Market research also aids in forecasting the demands. When you have an approximation of the demand then from here on you can connect the dots and move ahead for finding the right vendors and suppliers for raw materials and other such elements.
  • The best benefit of conducting proper market research is that it will help you immensely in finding out your USP.
  • Once you know your buyer persona, market demand and USP then it becomes easy for you to formulate a winning marketing strategy. All this will only be possible if you have done your market research well.
  • It will also provide you with correct information on the market regulatory environment and government rules about conducting your business.

In a nutshell, market research is the first step towards laying a solid business foundation for any entrepreneur. Market research gives your efforts a proper direction and saves a lot of pitfalls that one might have to face in the future. Knowledge is power and power is money. Do connect with me if you need any help with your market research, I will be more than glad to assist you.

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