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How to Research Your Market

Do your homework before opening your doors to avoid business-busting mistakes.

Brad Sugars

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Starting a business is a little like buying a car: You need to do some research before taking the plunge. First, figure out if there’s demand for your product or service. Do a competitive analysis. Find a place to set up shop. And create a plan to differentiate your offering.

Doing your due diligence can mean the difference between success and failure, and it doesn’t have to cost a penny. Networking, online research, informal focus groups and other do-it-yourself methods can often do the trick.

Consider the case of an event facility. It  started as a place to hold weddings. Located in a beautiful old house, it attracted wedding business, but wasn’t turning a profit because it was usually empty on week days.

So the owners contacted members of a nationwide wedding planners’ association with similar estate-type settings in other geographic markets. They discovered that others in their situation filled the gap with corporate meetings and by offering bed-and-breakfast arrangements.

Related: How To Conduct a Competitor Analysis

Today, 40% of the facility’s business is corporate events, and the owners are building a lodging facility on the grounds to expand their offerings.  Before you get the research ball rolling, you need to come up with a solid business concept. Once you have a concept, you need to determine if it’s viable.

Once you’re sure of your business idea, dig in deeper. You need information that’ll help you develop a unique business proposition that’ll give you a competitive advantage. The best sources of information will vary depending on the type of business and circumstances, but options include the following:

1.Trade Information.

In the wedding facility example cited earlier, the trade association for wedding planners provided a direct pipeline to the information the facility was seeking. Other trade information can also be found in print or online trade publications, or by walking the aisles of a trade show.

2.Demographic and Economic Data.

Try the Government portals such as www.statssa.gov.za, www.thedti.gov.za or city guides such as www.joburg.org.za to find out general information on things like age range,income, number of businesses by type in a geographic area and total sales in your category. For even more information, a reference librarian can point you to other specialised databases.

3.Business Groups.

Your local chamber of commerce maybe able to help you find the information you need. Also try government-sponsored Small Business Development Centres, which assist entrepreneurs and small-business owners.

4.Local Universities.

Sometimes professors at business schools are interested in having their graduate students do a market feasibility study for course credit.

5.Local Competitors.

If you’re starting a local business, shop the competition and check their websites. Or find a similar business in a similar city and ask to talk to the owner. Also look for similar businesses for sale and contact the brokers for information like why they’reselling and what their financials are like. You may be interested in buying that business yourself.

6.National Competitors.

Do an online search of businesses in your industry and evaluate what they offer to help fine-tune your idea.

7.Potential Customers.

Run your idea up the flagpole with informal focus groups. Talk with friends of friends – but not your own friends or family, since they may not tell you the truth – and old customers or existing customers if you’re already in business.

This is the acid test to see if your plan is ready for prime time or needs tweaking. To figure out if you should go ahead with your business idea, you need to ask questions like these:

  • Is the market saturated?
    Does your city really need another hardware store or flower shop? How much money is spent in your industry each year in your area? Is there room in the market for one more business?
  • Does the market want what you’re offering?
    If you’re thinking of providing day care for dogs or a facility where people can cook a week’s worth of meals in a group setting, will anyone care? Or if you’re developing a new online service for day traders, is it something they can’t live without?
  • What’s the competition doing?
    What do they do well? What do they do poorly? What’s unique about them? Can you offer something different that’ll encourage customers to patronise you instead of more established businesses?
  • Can you reach your target audience?
    If you’re selling inline skates, are you opening in an area with a population of the right age and disposable income?

Do you have a large number of competitors that you will have to research? Tell us in the comments section below…

Brad Sugars is a startup expert and the writer of 14 business books including “The Business Coach”, “Instant Cashflow”, “Successful Franchising” and “Billionaire in Training”. He is the founder of ActionCOACH, a business coaching franchise.

How to Guides

Keep It Simple: How To Write A One Page Business Plan

Lengthy business plans are a thing of the past and there are sound business principles for why.

Casandra Visser

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A Beginner’s Guide to Growing Your Business With Google PPC Ads

Google PPC Ads inform you where customers are engaging with your ads, and where they’re getting no traction.

Jandre de Beer

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You’re the owner of a business, and you want to learn how to grow your business with PPC advertising on Google. You’ve made a smart choice. There’s only one king when it comes to search engines, and that’s Google. Pay per click marketing or PPC is one of the wisest ways to promote using the power of this search engine.

When you understand how Google’s advertising platform works and how it can benefit your company, if you utilize it correctly, you will likely see significant and positive changes in your revenue.

What is Pay Per Click or PPC?

So, what is PPC? It’s a form of Internet marketing. You set up an ad online, and each time a visitor clicks on your ad, you’re charged a fee. Placing your ad on the powerful search engine Google, through the use of Google AdWords, is the most well-known kind of PPC advertising.

If you set up your campaign in the most efficient way – targeted keywords, compelling ad copy, an attractive and effective landing page, and more – the amount of money you pay for clicks on Google will be minimal compared to your profits.

For example, if you pay R10.00 for a click that leads to no sale, you’ve lost R10.00. However, if you pay R10.00 for a click that leads to a R2000 sale, based on your effective marketing on Adwords, you’ve gained R1990. Let’s say the cost of your product or service is R400, that means you still made R1590. That’s money in the bank.

How Does Google PPC Advertising Work?

Google pay per click is accomplished through the use of Google Adwords, released in the year 2000. Google decides what ads will show based on what is known as Ad Rank. This determination looks at how much an advertiser’s CPC or cost-per-click bid is.

It also looks at the advertiser’s Quality Score, which is comprised of the click-through rate of the ad, the relevancy and the quality of the landing page.

Related: How to Use Pay Per Click Using Google Adwords

Therefore, one of your primary jobs as an advertiser on Google is to set up your campaigns in a way that will work out favorably with Google’s Ad Rank determination. It’s not at all impossible with enough patience and diligence to succeed with this method.

What are the Benefits of Starting a PPC Campaign?

google-ads_embedded

The advantages to starting a pay-per-click campaign on Google are many and below are just a few of them!

1) Google is King

Because Google is the top search engine or the one that is most used, advertising on the platform can be hugely beneficial. There are over three billion searches on Google every day of the year. Therefore, the number of impressions and clicks you can receive for your ads has the potential of being huge, and that can lead to significant conversions and sales.

2) It’s An Effective Way to Get the Word Out About Your Business

You’ve started a business that you’re proud of, but if people don’t know you exist, how will your business make money? Having a website or a blog on the Internet is often not enough, especially if you’ve done no advertising.

Potential customers need to know what products or services you provide and how they will benefit from what you provide. Advertising on Google is one of the best ways to accomplish that goal.

3) There’s No Wasting Time with Guesswork

Google AdWords is a system that allows you to take the guesswork out of advertising. You have the tools to determine how effective your keywords, ad copy, landing page, etc. are for your advertising goals.

You’re also provided with targeting tools that better allow you to reach the kind of customers you want based on things like distance, cities, regions, or countries.

Related: Common Google AdWords Mistakes and How to Avoid Them

You’re given results of how many people have seen your ads, how many people have clicked your ads and tracking tools that tell you when those clicks have turned into actual conversions or sales. Guesswork never has to be a part of this advertising platform.

4) You Control When a PPC campaign on Google is Running

You’re in control of when your ad is running on Google. You can start it, pause it, re-start it, or stop an ad whenever you’d like.

How Do I Set Up My First Google PPC Campaign?

How does pay per click work with Google Adwords? Follow these steps to set up your first Google PPC campaign.

1. Create a Google Account

You will need a Google account to advertise on Adwords. If you don’t already have a Google account, go to Accounts.google.com/signup and create one. When you have a Google account, head on over to Adwords.google.com and sign in.

2. Name Your Campaign

There are various categories that you can choose for your campaign.  According to Google, “Search Network with Display Select” is the best opportunity to reach the most customers. Then you’ll need to come up with a name for your campaign.

Choose an organized naming system that allows you to identify each of your ads quickly. Select your location as well as the language that you’re targeting.

3. Choose Your Budget

You should always have a budget when working with AdWords, especially beginners. For example, a budget of R50 to R150 a day is a good starting point. That gives you enough money to play with keyword pricing.

If you bid too high, you’ll blow throw you initial monthly budget. For each keyword, choose to start with an average bid of R10.00.I suggest you start small with your budget and gradually scale up.

Related: Implementing 2 Advanced Google AdWords Strategies

Ad extensions can also be included at this stage. You can extend your ad with location information, phone numbers, or site links.

4. Choose Your Keywords

Crucial parts of your AdWords campaign are the keywords. What are keywords?

They are topics that describe what your content is about. They are also the words that people type into Google and other search engines. So, if a person is looking for a wedding photographer in Johannesburg, he or she may type in the Google search bar “wedding photographer Gauteng,” for example.

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After those words are typed in, the wedding photographers in Gauteng who have a presence on the Internet, such as with a website or a blog, will show up. From there, the person searching can do their research.

The more relevant your keywords in your AdWords campaign, the more likely your ad will be displayed predominantly (page one or two for your keywords) on Google for your target customers.

 

Without these relevant keywords, the people who you want to see it will never see your ad. The keyword “wedding photographer” is broad and is not enough to reach customers in Gauteng.

You can only create targeted keywords if you fully understand your niche and your audience. What are you offering and who are the people you’re offering it to?

These are two questions that you must be able to answer. You’re located in Gauteng, and your customers live in the area, but what other factors are relevant? For example, do you offer traditional wedding photos taken anywhere in Gauteng or only on Johannesburg?

Related: Cash in on Google with AdWords & AdSense

If you were a Johannesburg wedding photographer, the keyword “Johannesburg wedding photographer” is better targeted for your niche than “wedding photographer” or even “wedding photographer Gauteng. A keyword such as “photographer” is a broad keyword. It’s popular, and it has a lot of competition.

A keyword such as “Johannesburg wedding photographer” is a specific keyword otherwise known as a long-tail keyword. It’s less popular, and there’s a greater chance that your business will be seen using it. Choose both broad and long-tail keywords in your campaign, with a focus on long-tail keywords.

How To Find the Perfect Keywords for your PPC Startegy

1) Think About Your Niche and Write Down the Keywords That Come to Mind

Look at your website or blog for ideas. Also, consider what your customers would type into Google’s search bar if they were looking for your niche.

2) Use the Keyword Planner at Google AdWords under “Tools.”

When you enter in a keyword, the planner will return similar keywords, and it will tell you how many people search the keywords. Make sure you consider the advanced options as well; such as where you’re located and what language you want to target.

The results will tell you what the average monthly search is, what the suggested bid is, and what the competition is. For example, “wedding photographer Johannesburg” may return with a monthly search of 20 000 searches or so, with a suggested bid of R15 and may have low competition.

Related: Beginners Guide To Digital Marketing In South Africa (PART 2)

Your goal is to find keywords that receive enough searches but that your business has a chance to compete with. You’ll need to determine if your maximum cost per click matches up with or exceeds the estimated cost per click displayed by the tool.

5. Create Your Ad

The creation of your ad content is another important step in the process. It’s imperative that you understand your unique selling proposition or USP. It’s what makes your service different from other sellers in your area.

Your ad should convey the product or service that you’re offering, and it should have a call-to-action such as “learn more” or “buy now.” You will have 170 characters to work with, which include the headline, description, and URL.

Your headline is the most significant part of your ad, followed by your description.

It’s also advised to have a strong display URL.  Instead of just inserting your standard URL, you can change the domain name that you would typically include in your ad to something more effective, such as your call-to-action statement, for example.

Related: 9 Mistakes Killing the Success of Your Pay-Per-Click Advertising

Think about your customers and consider creating more than one ad when setting up your campaign, or split ad groups. These ad groups are more targeted and more relevant than one ad designed to reach all your customers.

So, using our Johannesburg wedding photographer example, your first ad can be designed to target brides who wish to get married in Johannesburg.

You could create another add that targets parents who want to treat the bride and groom to a Myrtle Beach wedding photography package.  You could create another ad that targets both the bride and the groom.  Get creative and think outside the box.

6. Set up a Landing Page

Landing pages are content on the web that has a particular purpose. Their goal is to get information to convert a visitor into a customer.  Landing pages have specific content along with one call-to-action button.

The CTA button can be hooked up to getting subscribers to your mailing list or to booking consultations, for example. You can have more than one landing page for each of your ads, to get even more targeted for customer conversion.

There are many ways to make a landing page. Look to sites such as Leadpages or Instapage for user-friendly ways to make affordable landing pages.

7. Track Your Ads

Converting a click into a sale is your number one goal with any PPC ad. One tool that you’ll want to use is conversion tracking. This tool measures sales once your ads are clicked.

It helps you to determine which keywords are working for you and which keywords are not. You can use the conversion-tracking tool provided by AdWords, for example.

You’ll be given a code to attach to your order form, or receipt page, or whatever your final page is that lets you know you’ve got a sale. Therefore, these tools only work if you conduct your sales online.

Also, utilize techniques such as A/B testing. This is where you create two different landing pages for the same amount and kind of traffic.

Determine which landing page works best and ditch the other one.

Now that you know how to set up your first ads on Google Adwords, don’t delay. Get started on researching the keywords so that you can create your first ad.  With practice and monitoring, your business can benefit greatly from this powerful tool.

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5 Ways To Hack A Business Plan

Bullet points are your best friends, and other tips for not getting caught in the weeds of business-plan details.

Christopher Hawker

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Whether you’re building gadgets, selling software or starting a nonprofit, your starting point is a vision, which gets turned into a plan of action.

In business, your plan is the road map that will help you pinpoint the answers to some of the most important questions pertaining to your venture:

  • What are you selling?
  • How will you make money?
  • Who will buy it?
  • How will you reach those customers?

Writing a business plan may sound daunting, but it doesn’t have to be. It can be fun! Throughout my career I have launched dozens of successful products – and each one began with some level of business plan. Because I have a lot going on, I never want to invest too much time in the actual writing of these plans, preferring to spend my time instead on the actual strategy.

Related: Business Plan Examples to Get You Going

So, how do I pen my own business plans? I hack them, and so should you. Here are my five business plan hacks:

1Start with a business model canvas

I strongly recommend that you begin with a business model canvas (Steve Blank’s blog is a great resource), especially if this is your first time writing a plan. It’s a tool for designing, inventing and thinking strategically about your company – all on one page.

The exercises will help you identify the resources you’re going to need and define the customers you need to approach. It’s a cool and effective way to brainstorm all of the key considerations when starting a business.

2Keep things simple, with bullet points

Once you’ve completed your business model canvas, you’ll have a much clearer vision of what you’re going to do, how you’re going to do it, and the people you’re going to serve. You then get to turn your canvas into the plan.

Business plans are more thorough and detailed. You will need one to share with investors if you want to raise money.

There is a section for each major area of consideration: Product description, target market, sales, marketing, operations, team, etc. You’ll want to address the who and how of each component of your business.

For example:

  • Who’s handling our marketing activities?
  • What channels will we use for getting the word out?
  • What activities will be performed in each channel?

Related: Keep it Simple: How to Write a One Page Business Plan

Thorough doesn’t need to be lengthy. Too often, entrepreneurs lose the forest for the trees, and get hung up trying to draft carefully worded prose.

Start by just getting your ideas down on paper in raw form as bullet points in each area. You can worry about making them sound good and organise them into paragraphs later.

After you write your ideas down, solicit feedback from your advisors, using a bullet-point form. This is will save you time integrating suggestions before you lock in careful wording.

3Focus on differentiation where it counts

business-plan-adviceAs you write your plan, think about what will make both your company and product or service distinct from your competitors’. You’ll want to capture your unique offering, and your business plan should emphasise this.

The good news is that while your offering should be different from your competitors’, many key elements of your business plan don’t have to be. You don’t have to reinvent the wheel or try to be different in every area.

For example: When it comes to your customer acquisition strategy or your logistics platform, you can do what everyone else is doing as long as there is no competitive advantage readily available.

Related: Free Business Plan Template Download

4Don’t overdo it on cash-flow projections

It’s easy to get caught in the weeds when you’re trying to create accurate cash flow projections.

The purpose of your cash flow and profitability projections isn’t necessarily to show exactly what’s going to happen; it’s to show how, within reasonable circumstances and success, your business is positioned to make money and can afford to keep the lights on.

Your projections’ purpose is to help you test your assumptions about profitability, not predict the future. So, you need to invest time in them, but you don’t need to go crazy trying to be perfect. Make your assumptions, declare them and proceed.

5Hire a writer

There are parts of your business plan that cannot be outsourced. Only you can decide what you’re going to do and the people you wish to serve. Thankfully, writing your business plan text isn’t something you need to do yourself.

Once you’ve completed your canvas and the high-level bullet points for the major sections of your plan, consider hiring a business writer if you’re short on time or hate writing.

Such people are relatively affordable and easy to find. I recommend checking out Upwork or Freelancer. You can then go back and forth with the one you hire, to get it just right. This can save a tremendous amount of effort.

The hacks I’ve detailed above are designed to help you save time and focus on what really matters, such as identifying your customer segments and understanding how your business will make money.

Related: Free SWOT Analysis Template

Once your business does start operations, things will likely shift anyway, so be efficient in spending your time on this task. If you treat the writing as a fun brainstorm on a living document rather than a daunting exercise, your effort will be inspiring!

This article was originally posted here on Entrepreneur.com.

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