Nov 23

Step #2 – Researching the market and validating the idea.

Now that you’ve found a business idea that sounds great to you, it is time to see if others think the same. This stage is very important and it involves idea validation – checking if the market needs it, how customers perceive its value and if there are customers at all willing to pay for it.

In the “Online Marketing Course For Young Entrepreneurs” I describe the steps of analysing competition, identifying target customers, and evaluating the seller position and market trends. Through easy to follow examples, you and your child will grasp the concepts of market research, the difference between customers and consumers, needs and wants, types of products, and other marketing fundamentals.

While engaging in a formal market research may not be the goal, it is still worth to get a good idea who your customers are, how, where and how often they shop, what is important to them, etc.

Creating a generalised description of a typical customer based on core characteristics, such as age, location, interests, will give you good understanding how to reach and communicate with them.

Why do we think about the customer first? A successful business does not exist without customers if you are willing to trade your time, effort and product for profit. This is why once you are clear what you can offer, it is very important to make sure there is a demand for your product. In other words, there has to be market potential.

Think of it this way – you’ve opened up a store in a desert. No matter how beautiful the store is, how good the price or the product is, if there are no customers, the shop will eventually be closed down.

This is why all of the consequent business activities should be targeted at your potential customers so they are willing to pay for your product and choose your product over competition. With this in mind, you can then start designing the product, its packaging, price, sale channels, and other marketing aspects.

Let me share a tip about testing. It starts with testing the business idea, continues with testing the product prototype or the actual product by your target customers, taking their feedback, making adjustments and testing again, and again, and again.

This is why flexible thinking, continuous learning and preparedness for changes is one of the key entrepreneurial skills that has many benefits in life beyond business.
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