How do you determine the demand levels when starting a new entrepreunerial venture?

Answer 1

There are several ways:

1. By secondary data - you can look for existing market studies of similar or the same products from market report vendors, trade associations or retail surveys conducted by the Bureau of Census.

2. By primary data - you conduct the market research yourself either by doing quantitative (e.g. sample size of 100 for a concept test) or qualitative (focus group discussion of about 10-15 people that represent your target audience)

3. By gut feel and observation - Sometimes you just know that something will work and that people will like it. It's a gamble, sure, but some people are just gifted with good gut feel.

Take for example the launch of Sony Walkman in the 70s - the chairman of Sony at that time did not do any market research because he did not believe in it. But he believed that he has a great product that people would want. And he was right.

Observe your market, research and read -- these are the ways to determine if there's demand for a product

Answer 2

You do market research. There are several tools available to you.

You can start with questionnaires. You show your product to random people and ask them questions such as whether they like it, whether they find it useful, whether they find it cool, and how much they would pay for it. At the end of questionnaire, you ask people about their age and income level (and record their gender as well). After you collected a few hundred questionnaires, you may see that some demographics (age / gender / income groups) are consistently more interested in your product than others. If so, you found your target demographics.

Then you do a couple of focus groups. You get several members of your target demographic group into a room, demonstrate your product, mention the price, and ask for opinions and thoughts. Depending on how enthusiastic the focus group is about the product, you figure the percentage of your target demographic that is potentially interested in owning your product. Note well: focus groups sound simple, but conducting them and especially interpreting the results is best left to professionals. A professionally conducted series of focus groups will probably cost you a few thousand dollars.

Then, assuming the previous tests went well enough, you can try a more precise (and much more expensive) approach, test marketing. You find a decent-size town in the middle of nowhere and offer your product there just as you would offer it nationwide (same channels, same level of advertising, but limited to this one town). Then you extrapolate your local results to the national level...

Answer 3

Hi,
Its all fine , but U got have the exp in that business U going to take on , just because u read a lot abt it does not mean U got to do it . Always start from the scratch.