As said in a previous post, if we want to get solid results from market research that we can use to build a product that has more chances of being successful, we need to put in some thought and some work into preparation. And I’m not going to lie, this is the hardest part of market research, so if you manage to get to the end of this process, rest assured that it’s all uphill from then on.
Remember that it’s never crowded along the extra mile. Putting this much effort into market research may seem silly, but if what you’re developing really matters to you, this is the best way to improve the chances of success.
Note that in this post I’m referring to preparation before having conversations with people involved in the purchasing process of your product or service (or envisioned one), so that you can start building our product’s content/feature selection and marketing strategies.
So, let’s jump right into it:
Market research preparation activity #1: Secondary research (also known as desk research)
That includes identifying alternative products, their characteristics, value claims, prices, and information regarding positive and negative aspects.
My previous post is dedicated to this activity, so it makes no sense to repeat it here. If you want all the details, be sure to check that post about how to do desk research for new product development.
Anyway, by the end of this activity, you should have all the information that is publicly available about your market, and based on which you can define some hypotheses regarding:
- What our product or service should include.
- What our product or service should not include.
- What our achievable price range is likely to be (broadly).
- Who our customers will be (in terms of target market segment).
- What our main value claims will be.
Once we have that, we will test whether our assumptions make sense during the interviews. Basically, the interviews will serve to gather missing information, and confirm whether our preliminary plan is based on solid assumptions, or whether we need to make some adjustments (or even more of an overhaul).
So let’s move on to:
Market research preparation activity #2: Create a product description (when possible, create a dummy sales page)
One of the things we want to test during market research, is how people react to our envisioned product or service. However, since we haven’t actually developed it at this point, the best we can do is have a description of it, that allows the interviewee to assess the product as closely as he or she would do in a real purchase situation.
The closer we can get our market research supporting materials to what people would experience when purchasing the product, the better our results will be.
This is particularly easy in the case of digital products or services, since we can build the sales page just as a potential customer would see in real life.
And if you don’t have a way to build a sales page because you don’t have a website, you can build a dummy page in a powerpoint document, or in canva, or with some other tool that allows to recreate what a sales page would kind of look like. You just need to have something to show people.
Even if building a sales page isn’t possible or doesn’t make sense, we can still put together a detailed summary of the characteristics that the product that we intend to build would have.
And if you’re building a physical product and have the opportunity to talk to people face to face and build a prototype, perfect. Again, the closer we can get to a real purchase situation, the better.
Note that you do not have to be completely sure about what you want to build when you start this process though. We can even have two or three completely different versions that we want to test against each-other to assess which one is better received, or even how willingness to pay varies depending on the features we intend to include.
In a future post I’ll go over how to test for which features to include, so more details on what to do with this coming soon.
For now, all we need to do is to make sure that we can explain what our envisioned product or service will be like in the clearest way possible, so that we can get reactions from people that are the closest we can get to the ones we will face in real life once we launch.
And it’s time to move on to:
Market research preparation activity #3: Select the main value messages
Here, what we need to do is select the main value claims that we want to make about our product. I’m talking about sentences that we want to use in sales page headlines, ads, or any other important marketing materials. Note that I’m talking about the key messages only, not all the sales copy.
The reason to do this, is that we want to test the messages we indent to use, to make sure that we use the best possible ones to get the attention of our potential customers, and to communicate our product’s value.
Note that in some situations there are several people involved in the purchasing process (for example a purchasing department or a boss if you’re selling to businesses, or a spouse or other family members if you’re selling to individual consumers).
We need to make sure that we address each one of those stakeholders’ wishes and concerns, so we will probably need to use different messages per stakeholder group. And because of this, we need to figure out which message resonates the most with each of those groups too (if they really have a say in the decision), because we need to convince them too.
But I’ll go more in depth about why we need to test the value messages and how to test them in another post.
Value message selection isn’t always as simple as it looks, since sometimes there can even be some interesting (and surprising) psychological aspects that we may want to take advantage of. Or avoid.
For now, let’s move on to:
Market research preparation activity #4: Define target prices
After we conclude the desk research, we should get a rough idea of what our achievable price range is. Or at least, the price we would like to sell our product for.
So, during our conversations we need to see how people react to a handful of potential prices, as well as ask a few other price-related questions that will help us price our offering at a level that does not make the sale overly difficult, nor leaves too much money on the table. Unless that’s your intention.
Anyway, what you would need to do here is take a look at your desk research findings, and select 5 or 6 price points from within the price interval that you believe might be achievable, and for which you’d like to sell your product or service.
Later, during the conversations with potential customers you will test whether your hypotheses regarding the attainment of those prices are indeed correct.
And, if you’re trying to establish a parallel in terms of price vs. value vs. a different, more expensive type of product to justify more of a premium price than what people would readily accept for your product, you will also need to test to what degree your arguments are accepted.
I have a post on pricing questions to ask during interviews, so you can take a look at that video to get the details about what exactly we would do with this. This is the homework for question number 5 in that video.
And finally, there’s only one more thing to do before we are ready for our primary market research interviews; and that is:
Market research preparation activity #5: Identify target interviewees, look up contacts, and think about what you'll give in return for time (if needed)
For the purpose of this post, I will assume that the target customers are the only relevant stakeholder group in your product or services’ purchasing process, but if that’s not the case, you may need to talk to other people involved in the purchasing decision.
That’s not the most frequent situation though, so for simplicity’s sake, I’ll ignore it here. But if you do have to deal with other significant stakeholders, make sure you understand their views and influence too.
Note that sometimes potential customers can explain the views of other people involved in the purchase fairly well, so you may not even need to talk to any of these additional groups to know all you need. Just make sure you understand whether additional influencers exist, and how you need to address them.
But moving on, I’d like to highlight that it is important that the people you talk to are actual target customers. Because if we interview people who aren’t like the ones we’re going to try to sell our product to, their attitudes towards our envisioned product, its price, and value messages may be too different from real target customer attitudes to yield information to build a strategy on (remember that garbage in, garbage out).
Moving on, depending on who you need to talk to, finding people to interview can range from super easy to the most difficult part of the process.
If you are a part of a community on social media that’s related to your product (such as a Facebook group), or have a mailing list of target customers that you can contact, finding people to talk to should not be too hard.
And they may even be excited to get a chance to talk to you about your new product or service, so you may not need to incentivize them at all.
Or, you can offer a short coaching session in return for their time, or an e-book, or some small token of appreciation.
However, finding people to talk to can be a painful process when you need to talk to people from other businesses, form specific institutions, opinion leaders, or… when your product is something that the target customers are embarrassed to admit that they use.
I have worked with all of the previous, so I’m fully aware of just how hard and frustrating it can get. And I’m not going to lie, this can really be the hardest and the most time-consuming step in this whole process. For me it is the part I actually hate. Fortunately, it’s also the part that can be very easily delegated. So… if you have that chance… do that.
Oh! a not so small detail is that, when talking to people for their professional capacity, they may not be willing to spend their time on an interview just to get a token of appreciation; they may require something more substantial; such as… being paid for their time.
The good thing is that, if you have a fairly homogenous market, you probably don’t need to talk to more than a handful of people. At the end of the day, people just aren’t that different.
How many people will you need to talk to?
Personally, I usually feel comfortable talking to 5 to 7 people. I have noticed that if I talk to 7, at least 2 will usually give me repeat answers. That means I would get at most 5 different opinions. I like to have a couple more just to be sure that I’m not missing anything. But truth be told, this will depend a lot on how homogeneous your market is, so it can vary a lot from case to case.
You need to go with the number of interviews you feel comfortable with, and possibly adjust that number as you see whether you’re getting similar feedback, or whether that is all over the place. Sometimes even as few as 3 can be enough if you see that they all say the same thing.
At the end of the day, your required number of interviews will depend on how safe you feel that the conclusions you’re getting from this exercise are indeed representative of your market, and will allow you to define an overall strategy with some level of confidence.
Also, remember that even if we’re unable to pin down which is the best strategy from the interviews, once we get a grasp of the direction in which things may go, that will allow us to think of a couple of alternative strategies, and we can then build a survey if we want to get a more solid idea of which one to choose. In some situations, it might even be possible to fine tune using A/B testing alone. So… don’t go overboard with interviews; they’re not meant for in-depth optimization. They’re a starting point.
Interviews are meant to give us a broad understanding of the market and gather broad feedback. If you want to know what we can and cannot get from interviews, check out my post about qualitative vs quantitative research.
Anyway, it’s important to conduct these interviews because it’s not infrequent for interviewees to bring up issues and suggestions that we might not even have thought about, and which we would therefore never consider or test (as I like to say, sometimes you don’t know what you don’t know until an interviewee brings it up).
Always keep in mind that the point here is to get a solid head-start to our product development and marketing strategies overall definition. Fine-tuning can usually be done later in simpler, more efficient, and cheaper ways.
Anyway, in my next few posts I’ll go over what specific questions you should ask to make sure that you include the features on your product or service that improve the chances of selling it at a profitable price, why it’s important to test marketing messages (I’ll go over a couple of interesting psychological studies), as well as how to test the messages.
And that’s it for today! See you in the next one! Bye!