Market research in the modern landscape BY MICHAEL J. PALLERINO
im Beach loves to talk shop. And when the conversation turns to entrepreneurship and market research and why the dialog with your customers must constantly stay open, Beach relishes at the chance to discuss the art of market research – an exercise he admittedly says is a never-ending endeavor. This is where Beach excels. At age 25, he started the American Computer Experience and grew the company with no capital infusion to $12 million in annual revenue and more than 700 employees. At the time, American Computer Experience was the world’s largest technology training company for children and fostered partnerships with Microsoft, Intel, Lego, NASA, among others. After Beach sold the business, he ventured into the academic world, clocking in as the top ranked business school professor for 12 semesters running while at Georgia State University. These days, he rules the airwaves with his School for Startups Radio, which can be heard on 12 AM/ FM stations and scores of internet platforms. Among his many guests are “Shark Tank” judges and winners, billionaires, bestselling authors and countless entrepreneurs. a
Simply put: You cannot afford to build a mousetrap without knowing if there are any mice.
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Give a listen, and one of the themes that runs through all of his guests’ success stories is their ability to deftly identify the trends and challenges that define their marketplaces. The foundation is simple, really. Success finds those companies that can find a good idea or run a good business better than anybody else. “If you sit around and wait to be hit with a lightning bolt of creativity, it’s just not going to happen,” says Beach, who also is the bestselling author of “School for Startups.” “I don’t believe in creativity – at least not when it comes to being an entrepreneur. Entrepreneurship has nothing to do with creativity. Most of us are not creative people. Creative people end up in the arts. Ninety-three percent of businesses around the world are copies of existing businesses.” One of the keys to building a successful and sustainable enterprise is being able to keep your finger on the pulse of your market. Enter market research. When it comes to the strategy, this much we know: Real market research – the kind that successful companies conduct every day – requires taking the time to uncover trends in your marketplace and finding out why they are there. Simply put: You cannot afford to build a mousetrap without knowing if there are any mice. “I think one of the most important things you can do with your market research today is to think way outside of the box,” Beach says. “It’s about calling people that you would think would never give you help. Start locally by calling your direct competitors – the people right down the street. Pretend you are a customer and find out everything there is to know. Ask what a good customer should know about the market and their business. Ask why you should do business with them.” Next, Beach recommends expanding your research nationally to get the vibe on what the market looks like for similar companies in other areas. What are their customers looking for and how are they meeting those demands? “Don’t be afraid to ask questions,” he says. “Entrepreneurs love to talk about their business. They love to share best practices.”
I think one of the most important things you can do with your market research today is to think way outside of the box.” – JIM BEACH, RADIO HOST OF SCHOOL FOR STARTUPS RADIO
ALWAYS BE RESEARCHING Somewhere between Houston and Boise, Idaho – and all stops in between, the entrepreneur in John Loud kept fighting to get out. In the early to mid ’90s, Loud, owner and president of LOUD Security Systems in Kennesaw, Ga., was traveling the world as a flight attendant at Delta Airlines, while also working on securing his pilot’s license. His original plan was to become a commercial airline pilot. But there were other entrepreneurial pursuits to follow, namely the security business. So, during every stop he made, Loud reached out to local security firm owners to pick their brains on the trends and challenges driving the industry. In June 1995, he left the friendly skies behind, secured a $20,000 loan and set up an office in his basement. “When you’re an entrepreneur, you have to have the right attitude,” Loud says. “You have to sit down and look at how you go from here to there. When I started, I didn’t know how any of this worked. I didn’t know anything about the security business. I didn’t even own an alarm system. It’s about connecting with the right people to share best practices. ‘How do you find and hire the right people? What’s the best software to use?’ Our R&D process is pretty straightforward – ‘Rip-off & Duplicate.’” The takeaway from Loud’s story is that the key to successful market research is to always be researching. The companies that do it right know that market research builds a foundation that fosters a culture of success. “That culture you create is the best element
for success,” Loud says. “This has really helped us maintain and grow our business. That ‘give-get’ philosophy we have in the community is an important part of our success.” When done thoroughly, the art of market research continues to work for LOUD. Twenty years later, the company has become one of the premiere names in the metro Atlanta security market.
LOADING YOUR TOOLBOX – CRAFTING YOUR STRATEGY One of the biggest tools in your market research toolbox is the other players’ in your market. Along with identifying whom the competition is, it is critical to find out what makes each one stand out. Ask the following questions: • What are their strengths and weaknesses? • Where are they located in comparison to you? • What types of customers do they cater to more? • How do they choose one provider over another? • What are the keys to success? • What buying factors make the most difference? Price? Product features? Customer service? Support? “When you’re analyzing the data and conducting your research in your marketplace, it is imperative that you look for the holes,” Beach says. “If everybody has the same answer, you’ll want to go in the opposite direction. You want to be the person who stands out and who can define your services.” The most important thing to remember – “If your message sounds like everybody else, you are everybody else,” Beach says.
RESEARCH, AND THEN KEEP RESEARCHING... Pat Alacqua, founder of Blue Magnet Partners, which provides entrepreneurial companies with problem-solving support and resources, says it was much easier in the past to get enough face-to-face time with customers to get to know them. That
connection enabled you to build the foundation of understanding, trust and rapport required for getting and keeping customer relationships. But technology has changed the way we interact and relate with one another. “There’s less face-to-face time,” Alacqua says. “There’s even less time to talk on the phone, which can make it harder to learn what your customers want and need, and harder to keep a solid foundation of trust that means you understand them and what their challenges are all about.” That’s why market research is no longer a one and done proposition. Every small business must build an ongoing approach to connecting with customers and staying in touch with their changing wants and needs. “Building a customer intelligence system is easier and so much more cost-effective today because of the many online survey alternatives available to small businesses,” Alacqua says. “A solid system of intelligence gathering about your customers and prospects will guide your development of solutions to meet needs, and also enable you to create the exact messaging to effectively position and connect with them.”
Building a customer intelligence system is easier and so much more cost-effective today because of the many online survey alternatives available to small businesses.” – PAT ALACQUA, FOUNDER, BLUE MAGNET PARTNERS