The series “How to Conduct a Market Research for Your SME” is intended to help you understand the importance of market research as a process and what steps you need to undertake to conduct a successful market research process for your SME.
As a business owner, to conduct a market research process for your business means that you’ll be able to make better business adjustments and better decisions while avoiding any costly mistakes along the way when you try to sell your products to the market.
Businesses conduct market research all the time whether or not they’re aware of it. You talk with your customers/clients about your business, you check the competitor’s pricing packages etc. But market research as a process that’s not that simple. Sure, you can undertake some activities on your own like a questionnaire for your customers. But if you want real results, your market research needs to include lot more aspects. Consequently, these aspects are complex in their nature.
Why should I conduct a market research for my SME?
In essence, a successful market research process for your SME can help you improve your product, your pricing system, your product placement and product promotion (4 P’s).
A solid market research process will also give answers to questions such as:
- What is the market?
- How is it segmented per different criteria?
- Who is your ideal client?
- What are their needs, fears, pains, hopes, dreams?
- Who is your competitor?
- Is someone else serving the same need to your clients?
- What lessons can we learn from history and what are the trends?
- How do consumers talk about the products in the market? Is there any gap on the market?
Without further ado, let’s start the market research process for your SME by understanding the initial step of a successful market research process first – the country analysis (PESTLE).
Country analysis (PESTLE)
When you want to enter a new market, broaden your business in other country or improve your position in an existing one, you need to do a country analysis first. Every market has its own challenges in a country. Your business needs to overcome these challenges in order to sell your products.
The PESTLE (Political, Economic, Social, Technological, Environmental and Legal analysis) framework is the best way to do country analysis. This is a framework for examining the external macro environment of a business.
The political factors refer to the political environment of a country, political parties and their movement. We are all aware that the governments affect tax policies and trading agreements. That’s why this factor is of huge importance.
Political factors are closely related to Legal factors. Legal factors include employment laws, trade regulations and restrictions, monopolies and merger rules and protection of the consumers.
Economic factors illustrate a broader economy and imply economic growth rates, percentages of employment and unemployment. They also include costs of raw materials (energy, petrol, steel), interest rates, exchange rates, inflation rates and other monetary policies. Usually, economic factors are different for every country.
The Socio-Cultural factors represent the society that a business needs to operate in. Consequently, these factors include demographics, age distribution, population growth rates, level of education, distribution of wealth and social classes, living conditions and lifestyle.
Technological factors are all about new tech inventions and tech development. They also cover changes in IT technology, changes in Internet, e-commerce and mobile platforms and government spending on innovative research. Environmental factors cover every issue with limited natural resources, waste disposals and recycling.
The PESTLE country analysis as a first major step to conduct a successful market research process for your SME should blend into a quality SWOT analysis to help you decide the threats and opportunities in the marketplace for your business that are presented by the macro-environment that you can’t control as a business. What you can control is how you’re going to react as a result of the market conditions, which will be discussed in part 2 of this series.
Thank you for your attention. If you are an Entrepreneur that wants to start a business or own a company that wants to expand, wants to successfully identify trends and competitors and better understand his clients but still not sure where to begin, BizzBee is here to guide you through the steps that will help you differentiate from your competition. Our expertise is in working with Entrepreneurs and Start-ups and we can guide you throughout the entire process.