Creating ROI through Effective Market Research

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Creating ROI through Effective Market Research
Analysis Presentationfor the Mid-Michigan
Inventors Group 3.28.07

• Judi Zima
• judi_zima_at_hotmail.com
• Solution Integration Services, LLC
• Bay City, MI 48708
• 989.450.1780

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Purpose of this session is

• To educate, inform and (hopefully) persuade you
  to comprehend the realities of the importance and
  criticality of market research analysis

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Topics Covered

• Reality Check
• Market Research Lifecycle
• Objectives
• Ultimate Goal
• Research Statistics
• Types of Market Research Resources
• Strategies for Accomplishing
• Importance Criticality
• Lessons Learned
• Questions

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Reality Check

• 90 of new products developed this year will fail
• 98 of small businesses fail due to a lack of
  customers no customer no cash flow
• Approximately 2 of businesses have written
  marketing plans
• Why?
• because entrepreneurs are too busy putting out
  fires focusing on customers thus working
  in-the-business rather than on-the-business
  activities
• The Secret Answer break marketing activities
  down into bite size chunks and intentionally
  schedule due dates to help with balancing the
  scale

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Basic Marketing Lifecycle Process
Phase 1 Market Research Analysis
Phase 5 Implement Evaluate the Plan
Phase 2 Planning What, How, When
Phase 3 Design Mkting Campaign
Phase 4 Construction Mkt Materials
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Objectives of Market Research

• Understand Your Industry, Market(s) Competition
  the Feasibility/Opportunity
• Understand Your Customer
• Understand Your target market(s) the needed
  strategy to penetrate
• WHY is the information required?
• Gives you a clearly defined TARGET
• that validates your assumptions with
• facts so you can focus your time, effort
• and into SUCCESS!

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Phase 1 Market Research
Project Activity
Outcomes
Actions
Mission Gather market customer research to
ensure feasibility and a successful strategy
Phase 1 Deliverables
Market Competitor Info
Phase 1 Research Analysis
Customer Info
Target Market(s)/Profile, Value Proposition
Roadmap
Strategy, Goals Pricing
Key Messages Elevator Pitch
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The Ultimate Goal of Market Research

• Definition of your target strategy market
• Knowing and articulating your target market its
  needs
• Definition of best customer profile
• Knowing and articulating your customers who,
  what they WANT vs need, and what motivates them
  to buy spend in this market
• Definition of your value proposition/competitive
  advantage
• Knowing and articulating your market niche
  benefits/value your specific target how you
  differ from your competition
• Elevator Speech
• Clarity in telling prospects about what you do
  and persuading them to become a customer
• Definition of SMART Goals
• market share, sales, customers, profit, etc. to
  shoot for within a specific time frame

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Market Research Statistics

• Survey Results
• In a 2003 survey by Capital Connection, 74
  venture capitalists rated the most critical
  mistakes entrepreneurs make in their business
  plans
• Lack of Marketing Strategy 28
• Lack of Clarity 21
• Unrealistic Assumptions 21
• Lack Detail 15
• Overly Optimistic 8
• Weak Competitive Analysis 7
• ROOT CAUSE for 1 usually results from a lack
  of or ineffective market research analysis and
  planning

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Types of Market Research Resources

• Free/Public
• Internet, government, trade associations,
  interviews, focus groups, etc.
• NAICS http//www.census.gov/epcd/naics02/naicod02.
  htm
• Demographics http//censtats.census.gov/usa
• Industry Benchmarking Info - Benchmarking is an
  effective means to assess where one stands
  relative to ones competitors, averages among
  peers, and best practices.
• State of Michigan MEDC http//www.michigan.org/m
  edc
• Trade/Industry Associations
• Universities Assistance Centers

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Types of Market Research Resources

• Other Free/Public
• Local experts
• People who love what they do enjoy talking about
  it with like-minded people, including their
  lessons learned.
• Your competition
• Review their websites other Internet results
  from reputable sources. Talk with supposed
  competitors, in some fields it's appropriate to
  collaborate with those competitors that don't
  directly compete for your business, but provide
  compatible services/products.
• Surveys
• You can get incredibly valuable information from
  prospective customers. On-line affordable tool -
  http//www.surveyconsole.com/
• Focus Groups

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Types of Market Research Resources

• Proprietary Services
• Market Research Companies (Full Service)
• Customized research, analysis and provision of
  research data/information reports
• Strategic Intelligence, Custom, On-Demand -
  Industry, Competitors, Product, Positioning,
  Pricing, Supplier, Packing, Materials, etc.
• Guideline http//www.guideline.com/
• Scientific Technical focus trademarks,
  patents, etc.
• NERAC http//www.nerac.com/
• Guideline http//www.guideline.com/

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Types of Market Research Resources

• Market Research Subscription Companies - provide
  access to data information databases for you to
  search and gather
• Strategic Industry Market/Competitor Info
• www.guideline.com
• www.bizminer.com
• www.zapdata.com
• www.hoovers.com
• www.marketreasearch.com
• www.infousa.com
• www.harrisinfo.com
• www.business.com
• Local Entities
• Market Research Company utilizes may of the
  above and other databases to research, obtain and
  provide information
• Allis Information Management Inc. -
  http//www.allisinfo.com/default.stm
• Market Sales Development/Consulting
• Industrial Visions Company - www.industrialv.com
• Advertising, Marketing, Communication
  Promotions Company (image/pr/advertising focus)
• The Barckholtz Group - http//www.barckholtz.com/
  
• Marketing, Promotion Web Development
• Evision Communications - http//www.evisioncommuni
  cations.biz/

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Strategies for Gathering, Analyzing Planning
with Market Research

• Option 1
• In-house resources/staff
• Access all public information sources
  accumulates whats available
• Internet, trade associations, government, etc.
• Option 2
• In-house market research specialists
• Custom or Subscriptions
• Use to fill in the gaps
• Option 3
• Option 2
• Outsource marketing weaknesses i.e. marketing
  campaign development, website design
  development, etc.
• Option 4
• Outsource market customer intelligence
  research, analysis, planning promotion

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Value Importance

• Lessons Learned Experiences
• CPA
• A CPA, specializing in tax returns, moved into a
  small town of 2,000 people not currently serviced
  by a tax accountant. He believed that by becoming
  the only accountant in town, the entire market
  would be his all he had to do was move there and
  open an office. Unfortunately, he made the
  mistake of not carefully reviewing the market.
  First, he didnt have 2,000 customers. Given
  the average of three people in a household, he
  really had only 650 customers. Next, most of the
  people who lived in the small town filed their
  own returns and were not potential customers for
  a CPA. Of the 650 customers, only 175 used any
  tax service and most of those used a low cost
  service because their tax work was simple. Of the
  2,000 customers, only 35 needed a CPA too
  small a market to support the practice. (Steve
  Marr Business Proverbs)
• Who wouldnt have assumed that his services
  wouldnt be valued/wanted in a city of 2K
• Starbucks
• Be careful of always going to a lower price
  first. Starbucks has learned they can charge big
  bucks for coffee by offering an experience for
  5.00 rather than a cup of coffee for 1.25.
  Starbucks understands their competitive advantage
  is not price.
• Who would have assumed that someone would pay
  more than 1.25 for a cup of coffee? Starbucks
  they did their homework and are reaping the
  rewards (Steve Marr Business Proverbs)

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So.Get Ready, Aim, Fire

• 1st Question
• Are you building your idea/business on a solid
  foundation of what the market customers WANT or
  are you behaving like a cowboy that just knows
  and is going to shoot from the hip?
• 2nd Question
• Which side of the statistics do you choose to be
  part of?
• Remember the statistics indicate that a lack of
  emphasis toward on-the-business marketing
  activity shows
• Approx only 2 of businesses have written
  marketing plans
• 90 of new products developed this year will fail
  
• 98 of small businesses fail due to a lack of
  customers no customer no cash flow

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Any Questions???
Thanks! For the opportunity to help you to
learn, succeed, prosper and grow!