Market Research

Discovering how good your idea is

MARKET RESEARCH
Market Research is conducted to demonstrate
the level of demand for your product
Primary vs. Secondary research
Citing your research
Asking for Help

Primary Research
Involves the potential business owner
surveying their potential customers for their
use, or potential use of the product / service.
What are you doing now? is a much better
indicator of future buying patterns than
What are planning on doing next year?

Secondary Research
Taking market research that has already been
conducted, and applying it to your business.
Since secondary research is generated for
general applications, you often have to
make assumptions on how the secondary
research applies to the specific market you
are researching.
What are some forms of secondary research
you can engage in?

Citations
APA Format
Citations in text and Reference List

Getting Help

Garth Homer
I will be happy to meet with you or your group. You
may contact me at Ghomer@okanagan.bc.ca or give
me a call at 250-762-5445 loc.4624.

Your entrepreneurship professors

Buad 293 Labs

GETTING STARTED
What is your business concept and how does it make
money?
Will someone actually pay for this product or service?

Get your NAICS code (under Products & Services)

Use your NAICS code to access industry trends via a
business database (e.g., Business Source Premier)
Cite the article, not the database
What is this telling you?

Success of your idea (business proposal)

Industry overview (business plan, section B)
Competitors
Hoovers Company Profile

Market Potential
How large is your market? What is your
potential market size?
Sales Forecasting. Top-Down
Approach. Estimate Market Size and
your potential share of the market
Family expenditure data (financial data)

Market Potential of Pets

# of $ spent on food in BC X
# of households in my trading area
(local health area)
= $486 X 76, 903 (2009 households in
Central Okanagan) = $37, 374, 858
Market size for pet related expenses
In Central Okanagan

Market Potential
TableBase (under statistical tools)
Types of pet ownership
Pet supply sales by product/service
category
Who spends on pets
Spending on pets

Market Potential
Performance Plus (financial
info)

Build your own profile

An online performance benchmarking
tool

Compliment this top-down approach

with a bottom up forecasting
approach

Who will you sell to?

Three types of customers:
1. Primary - The primary or target customer is most likely
to buy your product or service and could be a heavy
user.
2. Secondary - The secondary customer has a possibility
of buying your product or service but needs convincing.
3. Referral The market segment who will refer potential
customers to you.
Remember to differentiate between End
User and User that Pays

Chapter 4

4-12

Two Types of Customer Profiles

1. Business to Consumer (B2C) or
End-User Profile

If your Target market is the consumer or end-user, your

customer profile will likely require demographics or
psychographics.

2. Business-to-Business (B2B) Profile

Chapter 4

Many small businesses offer their services or products,

often on a contract basis, to other businesses.

These supply chain companies need a customer profile

that is based on business or company-type information.
4-13

Demographics and
Psychographics
DEMOGRAPHICS
Demographics involves key
personal characteristics of a
group of people. These
characteristics include:

Chapter 4

Age
Sex
Family Status
Age of Children
Education
Residence

PSYCHOGRAPHICS
Psychographics is the process
of segmenting the population by
lifestyles and values. These may
include:
Where they eat
Where they shop
Sporting activities they
engage in
Entertainment activities
they engage in
How socially and
physically active they are
Whether they travel for
business or fun4-14

B2B Demographic &

Psychographic Profile

What are demographic characteristics of B2B?

Size of business (revenues, employees)

Type of business (industrial or consumer products/services)
Type of employees (gender, ethnicity, education levels)
Type of business ownership
Account size
Years in business
Location
Credit risk (see pages 87-88)

What are psychological characteristics of B2C?

Culture
Leadership
Company activities
Community Involvement

Profiling your Customer

Industry information (articles)

Statistical Information (Tablebase)
Community Profiles (Location)
Economic Profile (Markets)

Friday Lab
Get Your NAICS code
Search for industry data (products &
services). What is happening in my
industry?
Research market potential (financial
and statistical data). What are the
market strengths of my idea?
Who am I going to sell my idea to?
Profile your target market (primary,
secondary and referral)

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