Most people, when they start a new business, consider who their target audience is.  They think of who they’ll sell to and how those people will react.

Invariably, these words are uttered:

“I think they’ll love it.”

Translation:  “I assume they’ll love because I do.”

There may be no bigger mistake in marketing than assuming what the behavior of consumers will be.  Just because you think your offering is wondrous doesn’t mean the world will.  In fact, as the driver behind your business development, you are one of the people least suited to viewing your offering objectively.

The way around these assumptions is market research – a process far too many small businesses and entrepreneurs overlook.  With market research you:

1. Understand the past, present, and potential aspects of the market place.
2. Analyze the characteristics, spending habits, needs, and locations of your target market.
3. Learn about the industry you’ll be working in and the competition you’ll be up against.

This gives you insight into segmentation and competitive differentiation, both of which are impossible to develop without market research.

We often deal with new business people who start-out unable to answer these vital questions:

• What is the main benefit (not feature) of your product?
• How does this benefit help solve your customer’s need?
• What distinguishes your offering from the competition?

The answers to these three questions are the essence of your unique value proposition (UVP).  Without it, you’re a venture without direction.

Importantly, market research will give you information on the viability of your business plan before you sink a pile of money into it.  When an entrepreneur starts a business and it flounders out of the gate, it’s usually because they failed to research feasibility before they invested.

Market research can be involved and time consuming – which is why many excited new business owners skip it.  Most SMBs don’t see the need to run focus groups on do phone surveys – and you may not need to go to those depths.  But you must do enough legwork to develop a clear UVP.  If you don’t have one, you’re not ready to enter a competitive market.

Any business can  at least gather anecdotal information.  Show your idea around.  Get a sense of what people’s needs are and how you’ll solve them.  And absolutely know who your competing against, and how you’ll distinguish yourself.

Don’t think people need you.  Know it.  Otherwise, this statement will also be true:

I think I’ll make money on this.

Get that assumption wrong and it will – literally – cost you.