| The product, service or technology that serves as the | | | | - Web Search - Using your favorite search engine and |
| foundation of your new business enterprise must be | | | | appropriate search words or phrases, begin a careful |
| more than a good idea or cool science project. It must | | | | search of everything you can find on the internet that |
| solve a critical problem or respond to a compelling | | | | pertains to your product, service or technology; your |
| market opportunity. Indeed, lenders, investors and | | | | intended target market; your presumed competition |
| potential employees will want to understand the size | | | | and your prospective customers. Sophisticated |
| and scope of this opportunity. And, so must you. | | | | research reports, studies and analysis may be |
| When it comes to assessing your market opportunity, | | | | purchased online from firms such as Frost & Sullivan |
| your opinion might be interesting but it is no substitute | | | | and Forrester Research. |
| for documenting in a serious and professional manner | | | | - Public Company Documents - If you haven't done this |
| the market landscape in your space. In fact, many | | | | already, you want to review websites and public |
| experienced entrepreneurs will tell you that during their | | | | financial information of possible competitors and |
| initial assessment of the market opportunity, they | | | | customers. In one place you might find that a |
| determined that they were focusing on the wrong | | | | competitor brags that it has captured 17% of the |
| market. | | | | market and in another place you might find that it will |
| So, what is the best course of action that will enable | | | | book revenue of $15 million in the current year. Some |
| you to document your market opportunity? | | | | simple arithmetic will tell you one competitor's |
| Step one is to simply list the questions that must be | | | | assessment of the total size of the market. |
| answered as you validate the opportunity. For | | | | - Industry Meetings & Trade Shows - People love to |
| example, questions that you might want answers to | | | | talk about themselves and their companies. By |
| include: | | | | attending targeted industry gatherings, you will be |
| - What customer needs will your product, service or | | | | amazed at how much you can learn. Remember to |
| technology address? | | | | document who you speak with and what they say. |
| - Who is the customer (profile) that will benefit? | | | | - Interview Potential Customers and Partners - This is |
| - What is the size of the customer base? | | | | often the most time consuming and most difficult to |
| - Who are some potential customers by name? | | | | accomplish but it is always going to be your most |
| - How does the customer currently meet the needs to | | | | effective form of market research. Talk to customers |
| be addressed? | | | | and find out if they will buy what you hope to sell. If so, |
| - Have customers said that they will purchase your | | | | how much will they buy and what are they willing to |
| product, service or innovation? | | | | pay? We know how hard this is but we also know |
| - How much can you sell annually? | | | | how important this information is to your success. |
| - How much will customers pay for it? So, now that | | | | Successful entrepreneurs really understand their |
| you know the questions, it is time to get the answers. | | | | markets. This knowledge will allow you to execute with |
| This is the tough part of the job. The answers should | | | | focus and precision. But don't worry. If you don't want |
| be quantitative and verifiable whenever possible. Keep | | | | to make the market research investment upfront, the |
| track of your sources. Here are some useful ways of | | | | market will teach you everything you need to know. |
| researching your market opportunity. | | | | The only problem is that by then, it will be too late. |