New businesses have at least one major competitive advantage over existing businesses: They can more easily design their business model and strategy around the latest market trends, insights and data.
But, of course, you first need to figure out how—and where—to get all that information. And hopefully not spend too much money on it.
Thankfully, there’s a treasure trove of free and low-cost resources to help new business owners fine-tune their business plan and determine everything from their target market to pricing to what products to sell.
Here are five low-cost ways to conduct market research when starting a business:
Leverage your social networks
Your social media networks—whether your LinkedIn or your Instagram page—can serve as “focus groups” to bounce ideas off of, or to seek input from. Because a following can be valuable to new business owners, it’s a good idea to start cultivating your startup’s social media presence before you officially launch the business.
Melissa Trager, founder of Resume All Day, a New York City-based job seeker coaching service, says she’s posted polls to her company’s social media following to determine what services her target demographic would appreciate—such as whether they’d be most interested in attending a resume-building workshop or participating in interview coaching sessions.
Analyze competitors’ reviews and information
Understanding what works—and what doesn’t—for your competitors can help you avoid costly business mistakes while identifying potential opportunities for your business.
Reading reviews on sites like Google, Yelp and Trustpilot can give you valuable competitive insights, says Axel DeAngelis, a Garden City, Idaho-based business marketing expert and blogger. “Using review sites, you’ll get a super-detailed understanding of what your target audience likes and doesn’t like about your competitors,” he says.
For example, if you see that customers complain about a competitor’s hours of operation, pricing or lack of a particular product or service, you can consider whether it makes sense for your business to address that feedback in its own operations.
Looking at your competitors’ websites, marketing and social media as part of your market research can also provide valuable insights.
Collect demographic and industry data
If you’re starting a brick-and-mortar business—or sometimes even if you aren’t—demographic data can help you zero in on your target customer base and make smarter decisions.
The U.S. Census Bureau’s QuickFacts tool has a wealth of free demographic data on every state and county, as well as cities and towns with a population of 5,000 or more. It includes age, income, employment and homeownership status data—among many other data types. Brandon Mackie, co-founder of Pickleheads, a site for pickleball players, said census data was instrumental in helping his team decide early on which geographic areas to target first. “The public census data allowed us to make informed decisions on which pockets and communities we should input pickleball court data for first,” he says. “I’m not sure if our company would’ve gotten off the ground had we not made data-informed decisions to start with.”
Local economic development and government agency websites may also have useful data and market insights. Industry groups and associations can also provide valuable research and data on trends in your specific industry.
Statista is another helpful online resource for all sorts of industry and market research data.
Conduct an online survey
If you have people willing to provide input or referrals to generate a list of first-time or prospective customers’ emails, you can create an online survey to gather input or feedback from them on whatever you need insights about.
Keep in mind that with surveys, shorter is generally better in terms of getting people to complete it. Moreover, many people will provide honest feedback only anonymously—so it’s generally better not to ask for personal information.
Mine search and digital marketing data
Especially if your new business is online, you’ll want to make sure you’re using the right strategies to attract people to your website and ultimately convert them into customers. That means understanding what SEO keywords and phrases people are searching when looking online for a business like yours, as well what digital marketing practices are working.
There are tons of low-cost and free SEO tools that can help you improve your website’s search ranking and online exposure. There are also conversion optimization tools that help you increase conversions and other digital marketing research tools. Think with Google, for example, has “Find My Audience” and “Grow My Store” tools.
The more thorough the market research, the better insights you will have when starting a business, increasing your odds of success. Make sure to take advantage of all the free and low-cost market research tools and resources available to you.Print this article