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Are you ready to start your online business?
Are you prepared to dominate your niche?
Do not rush...
There is one thing that you have to do before starting an actual online business. It is called market research.
One of the best ways to find out what your customers want to purchase, and discover more information about them, is to do the market research. Market research is one of the most important components of any business strategy. You have to listen and watch what your customers are interested in, and you will raise your online business' chances to get their attention and give them what they are looking for.
Got your attention?
If you're starting a new online business or have the existing one, you should definitely have business plan and business strategy. Market research is one of the first major jobs that you have to do before starting a new online business. Even if you already have one, you should do market research at least every semester if you want to keep up with industry leaders, influencers and most recents news.
Answering these questions will help you to do your market research:
What is your niche and target audience?
How does your ideal customer look like? (Age, gender, nationality, interests, lifestyle choices and so on... The more specific the better.)
How could you reach your target audience?
What other businesses are you competing with?
How much it will cost to market your business and product?
How much will your products and services cost in comparison with competitors?
Are there any opportunities to collaborate?
Every business falls into some category. You have to find your own targeted niche and audience. This is the first step that will help your online business along the way. You will also need this to find out who your competitors and possible partners are. Use Google's Keyword Planner to define main keywords of the niche and find out how many people are searching for those and how many results already appear on the search.
This one is related to your target audience but we want to go deeper into details. You have to draw your ideal customer as detailed as possible. This includes age, gender, nationality (if your business is local), hobbies and interests (what else could be related to your niche), financial capacity, lifestyle choices, educational background, language, shopping preferences.
Of course, if you're going to do B2B (business to business) you have to draw a different ideal customer: annual revenue, number of employees, industry, location, technology, business culture and so on.
You have to write out all the possible ways how you will reach your target audience and where could your ideal customer be found. That includes local places where they hang out, which social media networks they use, what they are searching for on search engines, who they are already following that you could buy or exchange ads from or collaborate.
When you will have your digital business idea, you will have to look at the competitors that are offering similar products, services or information. Look for other websites that are related to yours and analyse what they are doing. Look at their marketing strategies that they are using and how their websites are built. Try out the shopping process if they sell anything to find out if everything runs smoothly and what you could do better. It's recommended to even invest in some of your competitors products or at least opt in to their email list to see how does the selling process go. Analyse their sales funnel, write out their strong points and disadvantages. Find at least 3 or 5 top competitors in your niche or field.
Go on and try to setup different ad campaigns and write down the costs. Include social media networks that suit your niche the best (Facebook, LinkedIn, Instagram, Twitter, etc), Google Adwords, Youtube ads and so on.
Also keep in mind the natural traffic sources. Maybe it won't cost you directly but you would have to hire someone or outsource to produce great quality content. How frequent does your competitors post on social media and produce content? Time is the most valuable asset.
Compare the prices in market. What prices are you planning to set for your products and services? Is it higher or lower than your competitors and how could we provide even more value to our customers?
Realistically compare yourself with your competitors. What could you do differently? How could you be better? What are your strong and weak points?
Not all players in the market are your competitors. You could partner up with some of them and grow together. What are the blogs, media personalities, influencers and other businesses that you could collaborate with? Maybe there are other niches that are highly related to yours? You should dig into those as well.
You also might need to talk to potential customers or clients to find out their opinion about your product, service or project in general.
Follow the money.
What already works and what customers are buying?
Check for ideas both online and offline. Go to shopping malls and see how consumers act, what problems they are facing while spending money and how could you make it more efficiently. Your goal is to understand them and provide product, service or any other source of value that they would want to pay money for, share with pears or invest their time in.
You have to be sure that there is demand for your product, service, source of information or education before starting your online business. Check out our guide for testing your online business idea.
Write down all your market research on paper or into document that you could look back into while growing your online business. Market research is esential at the beginning stages of any business. But you should also do market research for your existing business, if you have one. We recommend doing market research once every semester. That way you will keep up with industry influencers and most recent news. It's always good to know if there are any new players in your field.
Do not underrate the importance of market research. If you won't do it now, you may have some serious regrets in the future. Don't make this mistake of a beginner.