In the age of big data, advanced analytics and an internet economy, market research has never been more imperative and precise than it is today. With a treasure trove of both detailed and minute information about consumers, businesses can study new ways of selling their products and marketing their services.
Suffice it to say, analysts contend that data is the new crude oil, and a market research company can extract this information with a myriad of technologies and strategies. With expertise in the field of marketing and tapping into your entrepreneurial skills, you can become a pioneer comparable to the oil drillers of the 19th century who improved our standard of living forever.
Are you an entrepreneur interested in dipping your toe in market research? We have compiled a step-by-step guide to help you get started and ensure your success!
1. Plan your business
Before you make your first cold call or conduct your first survey, it is important to plan your new market research company. There are many different components you need to consider to ensure that you are still open for business in the next five years.
First, determine your target market. Will they be consulting firms, advertising agencies or research departments? Will you be concentrating on B2B market research or public policy polling? Will you offer your services to retailers, financial institutions or airlines?
Second, are you charging a blanket fee? Or will your costs vary from client to client? Will you conduct research in advance and then sell the results to organisations? Indeed, every customer will have unique needs. Typically, a couple of hundred telephone surveys can generate at least $5,000, while mail surveys can bring in about $7,000 in revenues.
Third, what will be the name of your company? Whatever you choose, it is also a good idea to use it as your web domain, so perhaps you will need to think about a corporate name from a search engine optimisation vantage point.
Fourth, will you be operating your corporate entity in an office or from your home?
2. Establish your online presence
For the most part, you will attain your clients through digital marketing efforts. While offline initiatives are welcome and fruitful, your website and online advertisements will prove to be the most effective methods of adding clients to your Rolodex.
So, what should your overall digital marketing strategy look like in this type of market? Here are some tips to help you get started:
- Paid advertising: You can target your audience with dedicated advertising campaigns, or you can pay for the privilege of being a top listing on a search engine results page that is relevant to a particular search query.
- Content marketing: Content is king, and you can leverage the power of an excellent content marketing strategy that showcases your authority status in the industry.
- SEO: Search engine optimisation is more than just your placement on Google. SEO now involves speeding up your website, linking to other websites with relevant content, getting trustworthy websites to link to yours and creating unique content.
- Social media: If you’re not using Facebook or Twitter, then you should be. Being active on major social networks is critical for any digital marketing campaign, even if it is just as simple as sharing content, engaging with the community and answering customer inquiries.
- KPI: Whether you choose to integrate all your marketing channels, or you are going through them one by one, you need key performance indicators (KPIs) that can determine if your efforts are working. For sales, the number of new contracts signed per period or the number of engaged qualified leads in sales funnel. For financial KPIs, operational cash flow and net profit margin are useful measurements of success.
This is how you establish your presence in the vast digital ocean. It might require some upfront investment but pouring money into a digital marketing campaign is worth every penny.
3. Define your brand
Across Europe and North America, there are hundreds of market research firms. The critical question to ask is what makes you different from the myriad of other comparable organisations in your field.
Some companies are a one-stop-shop for all kinds of market research services. Others specialise in one area. When you are starting out, the best thing to do is to concentrate on one speciality.
Here are some niche concepts for your market research business:
- Conducting customer satisfaction surveys
- Performing mystery shopping for businesses
- Completing market segmentation research to divide a broad consumer market into sub-groups based on shared traits
- Testing market response to goods and services
- Executing brand equity research to understand consumers’ opinions of brands
How will you define your brand?
4. Brace for startup costs
Every enterprise will need to endure startup costs that will serve as seeds to grow your company. For a market research company, you need more than just your personal laptop and the Yellow Pages.
A professional outfit consists of the following:
- Office lease: Of course, how much you spend on leasing an office will vary in your region. You need to aim for a central and easily accessible location.
- Enterprise software: The software industry has produced many types of applications that are tailored to the market research sector. Software companies have come up with a wide variety of programmes with a particular type of client or industry. Many seasoned market research veterans do recommend employing a team of software developers to construct your own software solutions once you have grown.
- Technology: For your team to do their job, you will need the necessary equipment such as computers, telephones, mobile devices and any other type of technology that is relevant to your research efforts.
- Insurance: Business insurance is necessary for a company to operate with peace of mind. By purchasing business insurance, your firm’s purse will remain intact in the event of a covered loss. Although there are plenty of insurance policies to choose from, you can always start with general liability and workers’ compensation insurance.
- Fees: You will come across plenty of fees, but the two most common are professional and supplier fees. The former involving paying specialised professionals for their expertise, such as an accountant for tax purposes and an attorney for contracts. The latter consists of paying vendors for procurement.
There are also going to be ongoing expenses, such as website hosting, utilities, payroll (wages, benefits and bonuses) and telecommunications (phone and internet).
5. Prepare your business documents
The most common form of business documents is of the legal variety. This is probably also the most headache-inducing compared to everything on this list. Indeed, just reading through government paperwork – the blue and pink forms, especially – can give you a migraine. That said, since these are an essential part of running a company, you should have some idea of what you will be needing to get the company running.
Your adventures commence by forming a legal entity by completing and submitting applications for a business structure, whether it is a corporation or an LLC. Market research firms typically register their companies by applying for a limited liability company since it protects you from being personally liable if the firm gets sued.
The next step is to register for taxes. Every jurisdiction possesses different rules and regulations regarding business taxes, but you will generally need a tax number to pay your federal and state or provincial taxes.
Again, the permits and licenses you need will depend on the jurisdiction. Ultimately, you will need to inquire with your state or provincial and municipal departments to learn about necessary permits and licenses. Failing to do so could result in hefty fines!
Legal experts usually recommend market research firms to get their hands on informed consent agreements and services contracts. These are contractual documents that reduce your legal liability and foster transparency between all parties.
6. Open a business bank account
It would be prudent for your finances, and the finances of your company, to open a business bank account. Instead of tapping into your personal chequing account, you can pay for every business-related expense through an account that is dedicated primarily to your enterprise. Whether you are paying overhead or receiving funding from a small business loan, every dollar meant for your company needs to be deposited, spent through a business bank account and accounted for at the end of each workday.
What better way to monitor your business budget?
Moreover, it would also be beneficial to apply for a business credit card. Most financial institutions will offer their business clients one of these cards, so be sure to take advantage of them. Some banks will go as far as providing you with special offers and discounts.
7. Hire specialists
Inevitably, you will hire employees to fill certain roles within your company. But it is vital to take a different approach to human resources. Since there are hundreds of competitors in your industry, you want to hire specialists in their respective fields - not just workers.
By hiring quality professionals who have already established their place within their niche, you can immediately elevate your startup to the next level. Plus, what better way to attract clients than by maintaining a roster of top talent?
Consider the 1941 classic Citizen Kane. Charles Foster Kane transformed his newspaper overnight by hiring the best reporters in the country from a competing and more successful publication. You do not need to poach another organisation but launching a crusade to find top-tier talent is the way to go.
8. Build your client base
You have the website. You have the team. You have the technology and software. Now you need the clients. But how do you find clients? While some customers will eventually come to you due to ads or connections, you need to do the legwork during your business’s infancy period. This consists of making cold calls to companies, looking into your existing contacts, attending industry conferences and researching businesses or organisations that may need to conduct market research.
Of course, this is potentially the hardest part of running a new company. But who said starting a business was easy?
According to a 2020 report by Research and Markets, the market research sector is expected to rebound and grow at a compound annual growth rate (CAGR) of 4% to $82.9 billion in 2021.
Your startup can take its share of the pie. But this can only be achieved with the right business model, the best experts in their field and unique tactics of attaining market data.
Do you own a market research business? Share your industry tips in the comments section below!