Conducting market research
When deciding to start a business, it is crucial to study the terrain. To do so, market research is an indispensable tool. But which criteria should your business take into account for a successful market study? We aim to answer this question in this article and help you maximize your chances of success with a complete market study.
Your customer base
Market reseach must begin with a fine analysis of your current customer base:
- Who are your customers?
- Where do they come from?
- What do they buy?
- What are their needs?
This will give you key information on your comparative advantages, and about which areas are best to establish yourself.
Accessibility and positionning
Accessibility is crucial for any business. Your local branch must be close to a dense public transportation network, or very easily reachable by car/on foot. Market research will help you figure out which areas you should aim for.
Within an accessible area, it is important to see where the local branch is in its catchment area itself. As you get closer to the center, your chances of high customer attendance will increase thanks to greater visibility.
To properly compare the locations you have picked, you will have to factor in the number of inhabitants and the population’s characteristics. Depending on your line of business, you may have a large proportion of local clients. Communication operations and sales promotions may prove to work particularly well on them!
Thanks to the integration of INSEE data in our platform, you will have easy access to a detailed description (gender, type, age, socio-economic category…) of every local inhabitant. This is a huge advantage provided by our market research process when figuring out if your target area matches your target customers.
To go even further, you can factor in foot traffic but also vehicular traffic in the chosen area, since these elements are very revealing when it comes to attractivity.
Commercial attractivity and competition
It can be difficult to know if an area is attractive or not. For a good estimate, it can help to know the local businesses’ revenue and market shares.
Thanks to Oalley, you can export the number of businesses which exist in a chosen area, and sort them by sector, size, etc. This will give you a precise estimate of already existing stores and businesses.
If for example you want to open a new franchise, a quantitative market study will help you assess the risk of cannibalization by a nearby store.
Contrary to what one may think, conducting a market study to optimize setting up your business is neither expensive nor difficult. Thanks to tools which efficiently synthesize a variety of databases, you now have easy access to all the information you need to make a decision while minimizing risk.
Go a step further with the Pro version
The Professional version of Oalley enables you to get key information on the sectors you study, here are some examples of the datasets you can access for a chosen catchment area:
- Number of people living in the time zone
- Repartition by gender
- Population age
With this information, it is then possible to quickly assess the potential of a new location. If you wish to know more, feel free to contact us.