Market Research & Competitive Intelligence

As noted earlier, when you write your business plan, you will need to complete research on the state of the marketplace.
Two good sources for quality market information are Hoover’s Online at www.hoovers.com, Lexis-Nexis at www.lexis.com, Factiva at www.factiva.com, and Dialog at www.dialog.com. These are all paid services, but can be worth the investment if you can properly leverage the information in their extensive databases. And if, by chance, you are a university student, contact your librarian as you may have free access to these services. If you are not, make a visit to your local library. Many libraries will either have subscriptions to these services or static versions of the databases on CD.
To complete your market research, it is always a good idea to talk to potential customers. You can create a survey and send it out to potential customers using a tool such as IntelliContact Pro, or hold a focus group with a related organization in your area. If you have a prototype of a product you are working on, you can ask potential customers about everything from design to functionality. As an aspiring entrepreneur, many people will be willing to help you. Be sure to take advantage of this.
Generally, your research will help you uncover several target markets that you can reach with your product or service. It is important to, as specifically as you can, describe each of your target markets. You may define one of your target markets as married males 24-32 living in Hoboken, New Jersey or all persons over the age of 60 that suffer from type 2 diabetes. You can surely have more than one target market, known as market segments. For example, your product may be effective for senior citizens and athletes. Surely, you’ll want to have different marketing materials for each segment.
If you can, attempt to determine who you customers are, how many there are, where they are, what needs they have that currently are not being met, why they buy, and from whom they buy.