Five tips to help identify a market for your startup

If you have ever started an SME, or even thought about starting a small business, you understand that the experience can be exciting and nerve-wracking at the same time.

There is a lot of preparation that goes into a startup business, such as how much money will be needed, who the suppliers will be, will a loan be needed, and much more.

The biggest challenge many small business owners struggle to identify from the very beginning, is what market your product or service will operate in. Understanding the market goes a long way to helping in the preparation of your business plan and ultimately deciding how likely your SME is to succeed.

So how do you identify a market for your new SME? We've found five tips to help.

Identify a current market

As a startup, with no previous work to show for it's an unreasonable expectation to assume that your product has the goods to generate a completely new market. First, try to identify a market where there is room for your brand to fit in and grow, that way you build market share in an existing market and develop your business with an existing audience.

Confirm how your product will fit in the market

There are many sub-markets that operate within larger markets, so it's a good idea to establish where your product will fitt. Your product's position will depend on a number of factors, such as where the product is stocked, the demographic most likely to buy it and ultimately the price value of the product.

By identifying how your product will fit you can then focus on one customer segment and increase your chance of winning a strong share in that market.

Who is your target audience?

It's likely that your market will be made up of different demographics that make different purchases based on the qualities of the product. Customer's buying habits can vary based on their socio-economic position, their age and where they live.

One way to confirm the success of your business is to research and identify a demographic that will buy your brand and then focus your marketing efforts on winning their business.

Dun and Bradstreet can help you learn about your customers, for more information click here!

Find competitors with a similar product

As we mentioned it's uncommon for a startup business to open their doors and begin operations in a completely new market.

A great way to help determine the markets you should be operating in is by researching your competitors and the different markets they conduct business in. This will allow you to understand the demographic of the market and also how current marketing campaigns have been received by your target audience.

Starting up your SME can be the hardest part, so it's essential you do what you can to adequately prepare your business for success. Research can be time consuming, but identifying a market and demographic for your brand will be much more beneficial than starting with no real plan at all.


 

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