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Make or Break: Market Research

Lesson 3

"Market research" doesn't sound very exciting, I know. But this is the first step in the process. It's foundational. Get this wrong, and everything else you do is going to be a waste of time.

Your objectives for the market research phase are:

  • Find out exactly what your audience wants.
  • Find out about the problems they need to solve.
  • Find out (roughly) how much they're willing to pay for a solution.
  • Find out where you can reach people in your audience.

If you know whom you're selling to, know where they hang out and know that they're willing to pay for something you can offer, you've got a winner on your hands.

If, on the other hand, you don't know any of those things, your chances of success are minimal.​

That's why market research is so important.

Paying Close Attention

At first, I tried to learn more about my target market by simply paying attention. I was looking through forums, discussion groups and blog comments (on other people's blogs). My goal was to understand what people were talking about, how they described their problems and what they needed help with.

This "passive" research can be useful, but I noticed that to get a better picture of my market, I needed to take a more active approach.

Asking Questions

As part of my market research, there were a few questions that I tried to ask anyone I could reach, in my target market. For example:

"What's your business model? How do you make money?"

"What's the biggest obstacle you have to deal with, related to building your business?"

"Which aspect of online marketing do you struggle with the most?"

"What is one thing to learn or skill to acquire that you think would make a huge difference to your success?"

But wait a minute... how exactly did I ask these questions? Whom did I get answers from?

Forums

I was active in several Internet marketing related forums and I'd create threads there, asking for feedback and starting discussions.​

Outdated Forums?

At the time I did this, there were large, active discussion forums on every topic imaginable. In some markets, forums like this still persist, but a more current approach would be to search for and participate in Facebook Groups.

Sometimes, I'd open a poll in a forum and I'd provide multiple options to choose from.

I asked what people's biggest problem in running their business was and offered the choices:

  • Productivity - I procrastinate too much.
  • Information overload - I don't know where to start.
  • Lack of information - I need to learn more.
  • Lack of a clear plan - it all seems too chaotic.

The general discussions and paying close attention I'd done before helped me here. I already had an idea of what areas people's problems were in and the polls helped me narrow in on the biggest problems.

Another poll I ran asked: "What's your biggest challenge with online marketing?" And the answer options were:

  • Traffic generation - getting more visitors to my site.
  • Technical difficulties - setting up my site in the first place.
  • Conversions - turning visitors into customers.
  • Content - creating blog posts, videos etc.

On the one hand, I got some quantitative data from the polls. But a great advantage was also that these polls always sparked a discussion which was rich with insights as well.

Free Products

As part of my market research, I created two products that I gave away for free. This had several advantages for me:

  • The free products helped me build a small mailing list.
  • How people respond to the free products serves as an indicator of how important that topic is to them.
  • It gave me a way to practice creating products, so that my premium product wouldn't be my very first attempt at it.

I didn't do anything especially creative with these freebies. I simply offered them in return for people's email addresses.

In my follow-up emails, I asked more questions. My main goal was to engage my subscribers in a conversation, to get to know more about what they do, what they want and what they need.

I promoted these free products on my blog (which got almost no traffic at the time, but you gotta work with what you got). I also linked to them in my user profile within discussion groups where I was active and participated in discussions on blogs in my niche, linking back to my blog from the URL field.

None of this sent floods of traffic to my site, but it was enough to get to a list of over 100 people by the time I published my second free product.

Surveys

As soon as I had a few subscribers, I sent out a survey. I used an open source tool called LimeSurvey at the time, but I wouldn't do that anymore. It's simpler to just use Google Forms, now.​

I was surprised at how many responses I got. My first survey was sent out to only about 50 people, but I got 24 responses.

To reach more people, I also contacted someone who ran a membership site, teaching online marketing. I offered to create a course for his members, for free. He agreed and that got my foot in the door.

After I had delivered the course, I suggested he should send a survey to his mailing list and we could both share the data and insights gained. I set everything up for him, so all he had to do was copy, past, send.

Again, he agreed and this gave me the chance to get data from a much larger audience than I myself had access to.

1 on 1 Calls

I reached out to people in discussion groups and on my mailing list, asking them to get on a Skype call with me.

One way I did this was by looking out for people who described a problem I knew I could help them with. I'd send them a message offering to give them a quick, free coaching session, in return for answering some questions.

At the time, I didn't know this, but doing this is called customer development and we've written a detailed post here, about how to do it.

My approach at the time was not nearly as sophisticated as yours will be, after you read that post. But I still got a lot of insight from these chats I had with various people.

A Missed Opportunity

Here's something I didn't do, but should have: I should have told everyone I talked to that I was planning to create a product and I should have asked them if they wanted to be notified when it's done.

Since my product was being built around some of the things I learned these people were struggling with, I bet I could have added a dozen future customers to my list, this way.

The Result

As you can see, I was ravenous for information and insight. For a few weeks, all I cared about was to learn more about my target market, to understand what people struggled with and to figure out how I could best help them. I was doing zero selling at this point.

Here's what I found:

  • Almost everyone reported that generating traffic was a huge problem for them.
  • The majority of people said that SEO was an important part of their business model.
  • Specifically within the field of SEO, the thing that people felt most overwhelmed with was building backlinks.

I knew that I wanted to create a topic with a very narrow focus. This is why I was on the hunt for all this information. It didn't take long to learn that people struggled with traffic generation, but I didn't want to create a general "traffic generation course" or something like that. That's too broad of a topic. It would take too long to research and create a product about this and it would be more difficult to market.

I kept drilling down until I reached the specific topic: how to build backlinks (ideally for free).

A Note About Bias

The answers I got were, of course, biased in that they were all focused around "my topics". I wasn't just interested in finding the 100% objective truth about what people's problems were. Instead, the goal was to find the convergence between what I can teach and what people want to learn.

This is a good bias to have. But you have to strike a balance. My questions (and available answers in polls) were somewhat leading and focused around stuff I could help people with. But I also had personal discussions and left free text answers in surveys, to make sure I wouldn't delude myself.

Gaining Expertise

Once I had narrowed down to the topic of "building backlinks for free", I spent some time building up my own expertise in this area.

I already had a decent amount of experience in SEO. I was running several niche sites at the time and my main source of traffic was organic search. But before I started building my product, I wanted to dive further into this topic.

I did this in part through reading up on SEO blogs, but mostly through experimentation.

I tried every backlink building technique I could think of. I tested different techniques on different sites and watched what happened. The experimentation allowed me to separate myth from fact (something you don't get from just reading).

I also asked myself how I could make backlink building easier and less time consuming.

I took everything I already knew about building backlinks and refined my own process until I had a clear, neat system that worked.

My goal was to create a single, clear, step-by-step plan that anyone could follow.

Why?

Because my market research showed me that a major problem my prospects had was confusion and information overload.

The last thing they needed was yet another long list of link building methods. They already had more information and tips than they knew what to do with, but what they lacked was a clear system.

That was a void I intended to fill, with my product.

How Long Does All of This Take?!

As you can imagine, all this didn't happen over night. However, it also didn't take as long as you might think. Here are my numbers:

The product creation process itself (including the marketing work and the launch) took 6 weeks.

Including the entire research process, from the first steps to the product release, was about 9 weeks.

And the entire process, from not knowing anything about SEO, to building all my knowledge and skill, doing the research and then releasing the product took about 10 months.

I never have and never will pretend like you can become successful over night. What we're looking at here is 10 months of work (part time, next to a day job), for a $100K+ payoff. I'd say that's worth it.

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