Any successful businessperson will tell you that, when it comes to vetting new ideas and launching new products, you’ll probably never get good criticism from mom or dad, friends or family. Most of the time their natural instinct is to protect you, not to give you a slice of reality. If you want to get a real sense of whether a product or idea has potential, you have to throw yourself to the wolves. But before you do, protect yourself by conducting your own market research.
Market research is the process of gathering and analyzing data about what customers need, what they’re willing to pay and how potential competitors size up. There are two types of research that you need to be aware of. The first is primary research, which involves directly talking to people, from interviews to surveys and everything in between. The second is secondary research, which can be obtained from outside sources, such as reports, articles, third-party companies, etc. For the purpose of this article, we are going to focus mostly on resources for secondary research.
Companies spend about $16 billion a year on market research, but that doesn’t mean you need a huge budget to find meaningful data. A surprising amount of information is already out there, and it’s free.
Here are 15 of the best places to go to crunch the numbers.
1. Census Statistics of U.S. Businesses
This site is useful for determining how many competitors are in a specific area, as well as how many employees they have. You’ll need to know your NAICS number (NAICS stands for North American Industry Classification System), which is a common method for categorizing types of businesses. You can find your NAICS number here.
2. The U.S. Census
Need to find out where affluent married couples live? Which zip codes have the most new houses? Where people with graduate degrees live, or which cities have the most seniors? The U.S. Census is a one-stop shop for all that and more. Try the American FactFinder part of the site for creating custom data tables that will boost your demographic research.
3. Bureau of Economic Analysis (BEA)
The BEA is a great place for discovering more about gross domestic product (GDP) and personal income at the state and city levels. The BEA also details the flow of goods and services that make up the production processes of various industries.
4. Pew Research Center
The Pew Research Center publishes a wide array of survey-based research of various aspects of consumer life. Topics range from politics to social trends, to internet and technology use, to religion and media use.
5. Bureau of Labor Statistics (BLS)
The BLS provides a wealth of data about how people are employed in cities, states or other geographic areas. It also offers information about how much certain jobs pay, where layoffs have occurred, workplace injuries or fatalities, and even job outlooks for various industries.
6. The Business Benchmarker
This site, administered by Business.USA.gov, offers to “help you grow your business by benchmarking it against competitors, mapping your customers, competitors and suppliers, and locating the best places to advertise.” Just enter the type of business and your city, and you’ll be able to map you competitors, customers and suppliers, as well as get ideas for good ways to advertise.
7. Google Databoard
The Google Databoard is an interactive tool that helps you find data from Google’s archives of industry research. The information is categorized by industry, marketing objective and ad type. The “Perspectives” section highlights thought-leadership articles in marketing. Much of the content is oriented toward online marketing.
8. Census Business Expenses
Want to know what other companies in your industry typically spend for labor? What their average profit margins are? This website will give you the answers. One warning: the data is from 2007.
9. Census Business Dynamics Statistics (BDS)
If you want to know how many businesses like yours have opened or closed, this site is a must. The BDS offers annual statistics on job gains and losses by industry and state. The goal is to track the factors underlying job growth, but you can also use it to track competitors and understand their productivity.
10. The Consumer Expenditure Survey (CE)
Published by the Bureau of Labor Statistics, the CE is a survey of American buying habits. It includes information on what they spend, what they earn and how they live. It is the only federal survey of consumer expenditures, according to the BLS.
11. The American Time Use Survey (ATUS)
This survey, also provided by the Bureau of Labor Statistics, measures the amount of time people spend on various activities. It’s also a useful measure of how much time people do or do not have to perform certain activities, which may also be helpful for product positioning.
12. County Business Patterns/Zip Code Business Patterns
County Business Patterns is an annual dataset provided by the U.S. Census Bureau. It includes the number of business establishments in certain areas, which can be useful for testing advertising or setting revenue goals.
13. Nielsen MyBestSegments
This website is a great source of psychographics, or information about how people in a certain area live their lives and how those people view the world. Simply go to the zip code lookup page, and out pops spending information, family type and other valuable demographic information for any zip code, including potential customers’ lifestyles and media traits.
If you want to do your own surveys, few services are as good as SurveyMonkey. Go to the company’s website, create your own survey, and send it to your audience. The basic service is free, but you can upgrade to premium packages for a fee, which allows you build longer surveys, survey more people and get more feedback. The website also features useful analytic tools to help you evaluate your results.
This free site compiles IRS financial information and provides industry financials, which is useful for analyzing the financial performance of your industry and for setting financial goals based on that information. The site’s glossaries also help interpret the information.
Market research is a crucial part of starting a successful business. Without knowing where your customers are, how they live and what they spend, you risk promoting your product in the wrong places, to the wrong people, at the wrong price.