A lot of people seemed to wonder what I meant by a proper market analysis, so I figured that I'd elaborate on that in the form of this post.
I have laid out the five steps that my clients and I walk through whenever we want to find a target market for their idea. I'll stop ranting, as the post is long enough as it is. Hope you find it useful!
1. Determine your current strategical position
Look critically at your concept. What are the features of your product/service? What benefits does it provide for your potential target market? To go a bit deeper on this, what are the benefits of these benefits? You need to be able to pinpoint what sort of benefits your target market will enjoy by using your product or service.
You should end up with a list that clearly states the value of your product/service. After you have done this, think about who might have a need for the benefits of your concept. You likely won’t be able to pinpoint a market yet, but you will have a general direction to look at.
2. Zooming in on potential target markets
By now you should have a general idea for what direction you will go with your concept. It is time to zoom in and hone in on more specific attributes.
Ask yourself the following questions:
➤ In what age category does my potential customer fall?
➤ Where does my potential customer live?
➤ Does my potential customer have the financial capacity to buy my product/service?
➤ Is my potential customer highly educated?
➤ Is my potential customer more likely to be male or female?
By answering these questions, you are starting to build a client persona. The reason we use client personas, is that it makes it that much easier to find first adopters for our product/service.
If you have trouble answering these questions, your idea is likely too broad. I recommend my clients to focus on a very targeted niche, as it will be more easily to wrap your head around the benefits of your product/service in relation to their specific situation.
3. Pinpointing your client persona
By now you should have a good understanding of the basic features of your potential client. It is time to isolate your potential client and create a client persona.
Here, Ask yourself the following questions:
➤ What does my persona value? (Think about morals for instance)
➤ Does my potential client express specific behaviors?
➤ What interests my potential client?
➤ What sort of media does my potential client consume?
Think about how your potential client will use your product or service. When will your potential client use your product or service? You need to get a grasp on thought processes. I found it valuable to dig a bit into how economic psychology works to get a feel for this, but YMMV.
4. Gathering data
With your client persona in mind, you should exactly know who to target. Time to get in contact with them!
Depending on the nature of your service, this will happen either online, offline or a combination of both. At this stage we want to determine if there is a demand for your product/service among your client persona.
You can manually reach out to people that fit your client persona, and gather qualitative data. But make sure to not make the classic ‘Mom test’ mistake! That will skew your results and you will waste months of time if you don’t watch out.
Depending on the project my clients are running, we also utilize online advertising. At this stage, we know exactly who we want to target and what type of media they consume. The issue with this is that you need some specialized knowledge for this, so you might struggle to set this up on your own if you’re new to this.
You need to build a landing page that converts, you need to design ad sets that work, you need to have a basic understanding of copywriting and you need to know how to set up the ads. Besides all of this, it might be a bit time consuming.
If you DO have the skills however, you can easily gather tons of quantitative data this way. It’ll also allow you to quickly pivot to different client persona’s and if you know how to interpret the data you can end up with reports that give you great insight.
Personally, I like a combination of both quantitative data and qualitative data, as it will paint a more complete picture.
5. Analyzing the results
After gathering all of this data, it is time to reflect. Did you pick the correct target audience? Was your client persona excited for your product/service? Did they recognize the value?
Keep in mind that it is rare to get an instant hit, and you might need to repeat this process a few times. It is not strange to do 2-3 cycles of this before letting your idea go.
If you correctly follow this process, you can easily test multiple ideas in a month. Before I had this routine, I could spend months on one idea lol. Time is money, so use it efficiently.
If this sounds too difficult, or if you have other remarks/questions, feel free to PM me or ask away in the comments! I’ll try to answer as quickly as possible but it’s been busy lately.
Hope this helps!
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