Market Research for ecommerce / Online Business
Objective of the service program
Market research is about finding out whether the selected market is congenial for a business idea or project and gaining meaningful insights and information to improvise the business decisions.
Some of the biggest challenges faced by eCommerce/online businesses in market research are comprehending what constitutes ‘value’ for customers, identifying and defining the target segments, assessing the intensity of competition in the market and adopting the right competitive stance, determining the market size and demand forecasting, pricing and margins, etc. Thus, a valid question that emerges is how to do market research for eCommerce or online businesses? On the part of novice entrepreneurs and businessmen, the lack of specific experience and expertise is a big constraint when it comes to market research for online business.
In this service program, DFX shall carry out market research for its eCommerce/online business clients.
Why market research for eCommerce/online businesses and the challenges involved
When the idea of an eCommerce business entity is being considered by an entrepreneur or an existing business enterprise is intending to start selling online or digitally, it is natural to have certain basic questions in mind about the viability of the online business project or the decision to go omnichannel or multichannel. If it is logically and practically certain to an entrepreneur/businessman that people would not buy a product/service via an online channel, then there is no point in further exploration. If the market is too competitive and there is no strong value offering, even in that case the online sales strategy will not work. These are just some of the instances, albeit on the extreme ends, that could help businesses decide if they should start or expand to the online channel of selling. These insights are revealed with the help of market research.
Experienced market analysis consultants would know that a good market research lets businessmen not only comprehend the target market but also provide meaningful insights and analyses for more effective and informed decision making in marketing. These assessments are most commonly about comprehending what constitutes ‘value’ for customers, the target segments, the intensity of competition in the market and adopting the right competitive stance, market size and demand forecasting, pricing and margins, etc.
The very first question that should ring an eCommerce entrepreneur/businessman is if there is a demand for the products/services being offered? If the same or similar products and services are already present in the market (selling and buying taking place), it establishes that there is a certain demand. But it does not answer the dimensions of the market size. Ecommerce market research could reveal this.
The next consideration is if certain people are buying the offering, who are these customers? In other words, we need to classify and define the customer segment. There are multiple ways in which a target segment could be defined. The better this definition is, the better shall be the understanding of customers and their values. For example, for an online luxury retail store, if it defines the target segment only with the income factor, that will leave a lot of room for uncertainty. If they add one more factor (say a few regions/states in a country), their circle of focus will further shrink and make it easier for them to understand their customers more specifically and channelize their efforts with higher efficiency. Online business market research helps in characterizing this digital customer base.
For eCommerce/online businesses, the presence, quality, accessibility, affordability, and usage of the relevant digital technologies is another big consideration. Without these factors marked yes, eCommerce/online trading is simply not possible. Most of the countries/regions where the digital environment is mature and advanced are also the places where eCommerce is doing extremely well. Determining the nature of these crucial factors of a target market region is covered in market research.
Despite having the right digital environment, the eCommerce market in a region or for certain product/service categories may still be non-existent or nascent. Market research attempts to figure out the online buying behaviour of customers in a market. Take the example of ice creams. The eCommerce channel is helpless here unless the business model or technologies are innovative enough. If a competitor is able to achieve this, it must be worthwhile to find out how they are working out the delivery model.
A big barrier to eCommerce sales is the lack of a strong digital payment system and customers’ attitude towards digital payments. The former raises genuine concern. Apprehensions towards digital payments can restrict the growth of eCommerce sales. To achieve volume sales, it becomes imperative for online businesses to try to assess the popularity of digital payments in a target market.
Competition analysis reveals a lot about a target market. A good assessment of the prevailing competition in a market gives new businesses a starting point to begin understanding how existing businesses are serving the market and how good they are at it. Availing the services of professional market research consulting companies could be of help here.
With the business idea in mind, new eCommerce players need to first assess how they will fare in the face of the existing competition or the competitive forces. You cannot start a social media network in 2021 and think of outplaying any of the existing giants any time soon. There will be a need to adopt the right competitive stance. Competing is not always about facing another business head-on. A thorough market research helps in assessing the prevailing state of competition, the strengths and weaknesses of the probable close competitors, and their marketing strategies.
Why DFX for market research?
DFX (Digital Finance Experts) has experience in conducting market research for online/ eCommerce businesses across a multitude of verticals. Our team of market research consultants shall bring to action their experience and expertise in comprehending your unique business requirements and come up with a curated market research plan. In carrying out market research, we follow a planned and systematic approach using advanced digital applications. Our experts shall also present CTAs (Call to Action) and recommendations to help you gain a meaningful overview and critical insights for better decision-making. With dedicated services and periodical reporting, you shall remain updated on the market research activities and developments being made. If you have any question on how to do market research for online business or if you want to know about our market research consulting services, drop us a message and we shall be happy to reach out to you.
Objective is to understand product viability in terms the following factors:
- Product Demand Study
- Buying pattern and preference of our TG
- Product/ Services Categories Demand Analysis
- Keyword Analysis i.e. Online Search Analysis of our products: No. of searches per day/ week/ month in our target location
Objective is to decode competitor strategies and decode what's working for them? What strategies we can adopt and mistakes which we need to avoid.
- Identify and benchmark the key players in a competitive set
- Analyse the online best-sellers of your competitors
- Competitors Policies adopted for online/ e-commerce sales
Objective is to understand the price range at which players are selling today. Which are the products where we can match the market expectations and where there is a gap?
- Market Price Analysis (includes key competitors and market players)
- Suitable Price Bracket (Min-Max range): as per your brand positioning
Objective is to decode the Digital Marketing strategies of your competitors. Understand what's working for them? What strategies we can adopt and mistakes which we need to avoid.
- Evaluate the channels which is driving traffic to your competitors
- Determine industry trends and strategies adopted by top market players
- Evaluate the effectiveness of how competitors are acquiring customers
- Traffic Channels: Direct/ Referring sites/ Social Media/ email/ Paid Ads/ Organic traffic
- identify marketing channels that drive the highest conversion rates
- Top Referring Sites & Top visiting pages
- Social Media Leaderboard
- Influencers Profiling
- Trending Online Searches related to your Industry, products & services.
Objective is to understand the overall market opportunities and threats. Also identify our TG (i.e. target group/ customer)
- TG Demographics (Total Market size in terms of: Age/ Gender/ Cities/ etc)
- TG Profiling - 5W Analysis: Who, Where, What, When, Why
- Market SWOT Analysis
- Risk & Mitigation Factors
Objective is to understand the operations strategy adopted by competitors i.e. their overall team structure, head-office/ warehouse/ business locations, IT strategy, etc.
- Infrastructure Strategy
- Human Resource Strategy
- Information Technology Strategy
Post Analysis and research, DFX team shall set recommendations for action plan which needs to be followed to achieve the desired objective.
30 - 45 days.
Step 01 - Request for Quote
Step 02 - Service Quote Finalization along with SLA (Service Level Agreement)
Step 03 - DFX Experts start working on your business
Always humans, never bots.