When starting an online business or even entering a new market you need to establish a research strategy that fits your business objectives. Some entrepreneurs may lack experience and/or resources and their objectives will differ from a more seasoned marketer. Read more to understand how your research will differ according to the objectives & market size you're targeting and why this is the case.
When starting an online business one of your first decisions is selecting a research strategy that best fits your business objectives. The research you conduct will need to fit the 'type' market you have chosen and this is often times based upon your experience and resources.
Marketing on the internet can be very lucrative but at the same time it can also be costly and competitive. The typical start up entrepreneur generally lacks both the experience and resources needed to tackle a large and popular market. On the other hand a more experienced marketer can 'waltz' right into such a market.
The point is that the size market you target will influence the type of industry market research you will need to conduct. There is no such 'one size fits all' strategy for research that can be followed.
Correctly aligning your experience and available resources with your business objectives and thus targeting the 'right' type market increases your chances for success.
Here are the 3 types of markets in terms of size and research technique folks generally consider when marketing on the internet.
Popular Market
A popular market is generally a well known and very large market in which there is lots of competition. A market like this is easy to research simply because it is so large and popular.
The necessary data you want such as demand and profitability is easily available making the market research a walk in the park. The drawback to such a market is that it is very competitive which means you will have to invest more time,
effort, and financial resources to achieve any amount of success.
A market like this is usually the target of the more experienced marketer who possesses the necessary resources to make the effort easier and more worth their while.
Niche Market
A niche market is merely a sub-segment of a much larger market with a more clearly defined customer base. This can be considered more of a 'specialty' type market insofar as it targets a more specific demand within the larger market it was 'spun off' from.
The research needed to determine demand and profitability is more involved. Additional effort, ingenuity and resolve will be required to uncover the data you need to make an educated decision as to whether it is worth pursuing from a marketing standpoint.
The upside to this type market is that there is less competition making your marketing efforts less costly and more effective. Also being that the market is more 'specialized' and smaller in size, product availability is somewhat scarce allowing for greater profit margins.
Micro Niche Market
The micro niche market is a sub-segment of a slightly larger niche. By even more clearly defining a particular demand or need within a larger niche you can 'create' this type 'micro' market.
As you would imagine the research needed here will require even deeper 'digging' for the data to insure the markets demand and profitability.
Once again due to the highly 'specialized' nature of this type market higher profit margins can easily be maintained and with less competition.
Both the niche and micro niche markets are more suitable to those who don't have the experience or resources necessary to compete within the large and popular markets.
When starting an online business it is important to select the right research strategy before entering into any market. Your industry market research should be aligned your business objectives which likely reflect your experience and available resources. As we discussed above the 3 types of markets typically researched do vary insofar as the amount of research conducted and the techniques that are used. In the end whether you are a start up entrepreneur or a seasoned vet your familiarity with these market types and the work involved will benefit your decision making.
