Globally renowned management expert and author, Peter F Drucker famously said: “There is nothing so useless as doing efficiently that which should not be done at all.”
The same adage applies to business.
You may have that killer idea for launching a new business offering unique products or services. Unfortunately, that does not imply customers are pining to become your customers.
Therefore, you have to determine if there is a market for your business idea. It can provide insights on whether the business is worth investing money, time and effort. There are simple ways to determine if there is indeed a market for your business idea.
Here we explore ways and means to find that.
How to Determine Market for Your Business?
There are various ways and means to determine if there is a market for your business. Here we look at some of these simple steps.
The relevance of Your Business
“If you create something that makes a difference in people’s lives, you are likely to become a business success as well,” says Richard Branson, Founder of Virgin Group. Rightly so. Because people will buy a product or service only if it makes a positive difference in their lives.
For example, Amazon met runaway success because it brought about a revolutionary change in our lives. And it came at a time when Internet proliferation was growing worldwide.
Knowing whether your business is relevant to the public at large or niche clientele is the first step towards determining if you can find a market. You may have wonderful products and services. But if they are irrelevant to people, there will definitely be no market.
Demographics simply means knowing more about people in a particular geographical zone. It includes data such as their median age, disposable income, and purchasing power, spending patterns preferences, religious leanings and lifestyle.
Understanding the demographics of your target customers will help determine if there is a market for your business. It will help us understand how much people can spend and are willing to pay for something, regardless of whether it is common or very unique.
You could have an amazing, low-cost product or service. Yet, it may not conform to the religious views of people in that area. Or you might have high spenders that prefer buying imported stuff for prestige. Such factors can adversely impact your business.
Proven Business Ideas
Generally, time tested and proven business ideas stand better chances of success than new, untried ones. Ideally, you can try any good small business idea to launch an enterprise. There are several excellent and workable small business ideas you can find on MoneyConnexion
Understandably, there would be competitors in these businesses — find the latest trends in various industries. Nowadays, ecommerce and digital marketing are booming industries. Hence, any enterprise that supports these sectors will most likely be successful. You can carve own niche in these high demand businesses to ensure better success.
Know Your Competitors
Knowing potential competitors is a superb way to determine if there is a market for your business idea. Too many competitors, especially smaller ones, implies your business idea has a market. The presence of many competitors clearly indicates there is a huge market for a particular product or service.
Unfortunately, several rivals vying for a slice of the same market means you stand lower chances of success. But this need not deter you.
Czech writer, Milan Kundera says: “A business has only two functions- marketing and innovation.” If you can offer innovative products or services that outshine rivals, it would be possible to thrive in a fiercely competitive market. Hence, find whether your business offerings can be adapted to meet the requirements of the target clientele better.
Understand Existing Prices
Understanding how competitors are pricing their offerings will help determine if there is a market for your business idea. Any market where there is rampant undercutting on rates and prices in different ways is a wrong place to be, even if there are few competitors.
The reason is simple: Others have set up a business to cater to locals in that area but find few customers. Unable to find markets, they undercut rates. Therefore, understanding existing prices can prove very important to know more about any market.
Online, Offline or Both?
Determine whether your business can find customers online or you need to have an only brick-and-mortar presence. And whether you can operate both- online and offline. As Bill Gates says:” If your business is not on the Internet, soon your business will be out of business.” That is because ecommerce is now the new trend in business. Ecommerce is here to stay for long.
Unless your business can go online and reach faraway customers, the idea is not worth pursuing. Almost every business- small or large- now has a significant online presence. Finding whether you can attract distant clients online will help you determine if there is a market for your business idea. Often, distant or foreign clients can form the core of your business. Hence, an online presence is extremely necessary nowadays.
If you are confused on how to determine if there is a market for your business idea, follow these simple steps. Never rush into a business merely because something is in high demand. Instead, find the details we mention above. Understandably, the above steps would take time and effort on your part. Yet, in the longer run, they will prove worthwhile. They can help prevent losses and help set up a flourishing business.