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How Market Research Reduces Risk for B2B Tech Startups

Posted by Sellerant July 30, 2020 7:59:45 AM CDT
Sellerant

Startups: Don’t waste your time and money. Learn how to use market research to overcome inertia and validate your product-market fit.

#4 7.30.2020 The Biggest Risk for B2B Tech Startups

 

Everyone knows being an entrepreneur comes with plenty of risks. Launching a B2B startup especially involves a great degree of uncertainty. But one startup risk stands out among all others: inertia.

Inertia happens when you get the ball rolling and can’t bring yourself to stop it. You forge ahead in your new venture without pausing to assess the field and review your product-market fit. 

Do customers truly need your product? Do they agree that your service is valuable? If you don’t know these answers, you risk investing yet more time and money into a business that may never leave the launch pad. As a startup, everything you do must directly support a value proposition that your customers unambiguously endorse. 

Conquering Startup Inertia With Market Research 

B2B tech startups often pursue a lean business model and skip or marginalize market research — only to join the legions of fellow startups struggling with lead generation. A product/service with enormous value in the minds of its creators and early adopters enjoys no guarantee to survive the test of the wider market.

Conversely, startups that embrace market research acquire business intelligence that can drive a powerful strategic roadmap. The two major types of research — qualitative and quantitative — drive different but complementary insights.

Qualitative market research involves talking to buyers in a systematic, tactical way to gain a realistic assessment of your product-market fit. Tools in this category include personal interviews and focus groups. Through strategic conversations and active listening, you can gather invaluable qualitative data to evaluate your product and/or service and create a foundation for more representative quantitative research.

Quantitative market research builds on your qualitative discoveries by moving insights from anecdotal to mathematical. You can use secondary (existing) research to support the findings from your buyer conversations with statistically significant data. If your market and/or buyer problem is especially specific or new, you might even conduct primary research (through a market research firm) with formal surveys and statistical modeling.

Used independently, both qualitative and quantitative market research can yield spectacular business intelligence. Used together, these tools invariably give startups a powerful edge. Inertia is mitigated, and lead generation struggles fade beneath the glow of an agile, data-driven plan to maximize product-market fit.

Getting Started with Startup Market Research

Research can seem daunting, especially for startup teams with extremely limited time and resources. You may have a dearth of research qualifications internally, and outsourcing to market research firms can get expensive. Don’t let these obstacles deter you or push you to pursue improper research techniques.

Qualitative research via tactically-structured interviews is a low-cost way to get started. Talk to both current customers and potential buyers, asking similar questions to generate roughly comparable findings. Even if this is the only research you complete initially, you can use these insights to make better business decisions and more accurately assess your product-market fit.

When you’re ready to take your research to the next level, seek out firms that run focus groups and market surveys for startups. Share your initial findings with them, create research goals, and understand that information yielded by their work becomes your valuable intellectual property.

Finally, if your startup already gathers — or has access to — troves of data about your buyers and/or market, you may be sitting on an untapped resource of enormous value. Sit down with your data and exhaust the possibilities: create hypotheses, test with models, and repeat. The richest insights of all might be hiding in your own databases, waiting for you to discover them.

Ready to conquer inertia and get started with startup market research? Let’s talk!

Topics: strategic planning, strategic roadmap, b2b tech startup risk

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