Market Research

I just started my startup so why would I pivot?

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Anyone who has founded a startup can tell you. It’s a roller coaster.  Expect the unexpected.  Make a plan B, and C and probably D too.

One of the most critical skill sets for a startup founder is agility. It can be difficult, especially when you’ve poured your heart and soul and personal savings into your big idea. But often times, the most successful founders are the ones who were willing to make necessary adjustments, either in the product or the business model. This is the pivot.  This is the moment when you acknowledge and act to chart a new course.  So how do you know when it’s time to pivot?

There’s no perfect answer, but conducting a bit of market and competitor research will often reveal important pivot points.  Most pivots arise from gaining a piece of competitive intelligence that invalidates a prior assumption. For example, have you made assumptions about your market size being larger than it really is? Have you made assumptions about the age or habits or disposable income of your buyers? Have you made assumptions about the likelihood of being granted a patent?

Here are three real life examples we’ve seen recently:

1.     The founder made an assumption that her customers would be predominantly Millennial generation because the product would be sold through online channels. After we researched her market segment, we learned that in fact, buyers in this category of ecommerce were almost evenly split between Millennials, GenX-ers and Baby Boomers.  The research opened up two entirely new verticals to market towards and provided more detailed definition to the market size.

2.     The founder made an assumption about the most compatible retail outlet for his product, a “fit food”.  When we researched the market segment, we could see that the grocery market was saturated, but the open opportunity was distribution through sporting goods stores. The likelihood of capturing market share was far greater with the less obvious channel partner.

3.     The founder made an assumption about the adoption of his product by government agencies as the primary sales channel.  However, the research showed the inefficiency of landing contracts with those agencies in relation to the sales pipeline necessary to hit investor growth targets. The decision was made to pivot to private contractors for the initial go-to-market strategy and develop a secondary long play for government agencies.

In each of these cases, the research invalidated an assumption the founder had made regarding his or her market segment or primary buyer.  But by analyzing and accepting the research, each was able to make a critical pivot to their startup and undoubtedly improved their chance of success.

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Free Market Intelligence for Franchise-Heavy Industries

The other day, a client came to me with an interesting request: How many independent pizza restaurants operate in the US.  After consulting the usual library resources and pizza industry associations, I was still unable to fully answer this question (I had the total number of restaurants, market size etc, but I did not have the number of non-franchise establishments).  I turned to Google for answers and in the process found not only the answer to my question, but also an interesting free resource: Franchise Direct (http://www.franchisedirect.com/).  What is Franchise Direct?

Franchise direct is a site designed for people who are considering taking the plunge and opening up their own franchise, say a Starbucks, for example.  The site, as far as I can tell, makes money by directing interested parties to franchise opportunities.  To make the site more attractive to prospective franchise owners, Franchise Direct provides industry information for each franchise vertical it profiles, for example coffee houses or housecleaning services. 

How Can Librarians and Researchers Benefit from Franchise Direct?

The reports on Franchise Direct are actually pretty good and typically contain market sizing, demographic, and industry-trend data.  Their data and analysis are not de novo.  The information for their typical industry report comes from major research firms like NDP and Frost & Sullivan, in addition to data from industry associations etc.   Franchise direct also has data on the capital requirements for various franchises, which is an interesting data point in its own right.

Are there any Problems with the Site?

Franchise Direct does have some major drawbacks, though.  Consistency is a big problem for this site.  Some industries have very light industry profiles while others have no information at all.  Thus, mining Franchise Direct for market intelligence is something of a tossup.  You can rest assured that popular franchises like coffee houses or pizza restaurants will have good market reports, while less popular verticals, like courier franchises, will have less attention.  The site, which has been around for approximately 9 years, does not seem particularly interested in filling in these gaps. 

In any case, Franchise Direct is a great resource to keep in your back pocket.  It has very useful market information on consumer industries that have a multitude of franchising opportunities, not to mention details and data on starting a franchise.  Check it out here: http://www.franchisedirect.com/

Three Key Business Plan Resources

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People often conduct business research with the intent of using it to inform a business plan.  So where should you visit on the interwebs to find a good business plan how-to? 1.  The United States Small Business Administration has a thorough guide that walks you lists the major component of within a business plan, and if you need to bounce your plan off a sounding board, they can help you find a mentor too.

2.  In terms of sheer volume, Bplans.com offers hundreds of free sample business plans across most industry categories, making the odds reasonably good that you will find a comparable plan to give you inspiration.  Unfortunately their sample charts and financials are largely for show, unless you actually shell out money for plan-writing software that holds your hand througout the process.

3.  The Center for Business Planning has a selection of winner plans from the prestigious Venture Labs Investment Competition (formerly the Moot Corp Competition) which is hosted by none other than UT Austin.  While the companies are not necessarily real, the time and effort invested by the student compeitors certainly are, making this twenty-some-odd series of plans worth reading.

Note: As you're perusing the plans' intro page, it may not be readily apparent that links to the rest of the plan are available through the small blue Table of Contents box at the bottom of the page (see pic).

A Go-to for Researching the Chinese Travel Market

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When I'm conducting my research, i.e. scampering on the interwebs, sometimes a bizologie-related site takes me to another page, and another, and then I've suddenly encountered a new entry-worthy resource.  For example, last week I wrote on Hospitality Net, and while delving in its Columns area to decide if it was worth mentioning (which indeed I did), I found an article that was so condensed as to have most likely stemmed from a larger report. Sure enough it ultimately linked back to China Travel Trends.com, which made my not-so-inner business researcher weak in the knees.  The publication is a child of parent institutions Dragon Trail, "the premier brand engagement firm focused on travel and tourism," and "COTRI (China Outbound Tourism Research Institute), the leading advisory and resource firm to assist travel and tourism organizations to cater to Chinese tourists" (About).

So what are the must-see spots on this website? The Homepage's Blog & its Popular Posts sub-section together identify news and market trends that may be especially useful for future-gazers.  But best of all, via the Resources tab you can access the freely downloadable Essential China Travel Trends Book- now in its second (Dragon) edition- which is a huge compendium of market intelligence on both the consumer psychologies of Chinese travelers, as well as the economic, cultural, and political forces impacting the market.  Definitely worth a visit!

Hospitality Net for Hotel Industry Research

Hospitality Net

Researching the hotel industry?  Then make sure to check in, time and again, with the Hospitality Net website.  The editors have it booked to capacity with such a phenomenal assortment of industry information that we find it hard to believe they have made so much information freely available.  It’s not unlike the rare joy of sitting in a swanky hotel lobby during a conference and realizing you don’t have to pay for the wifi. We particularly recommend seeing the following areas of the site: Industry News, which is conveniently further broken down by category. Market Reports, which are complimentary executive summaries of industry performance (including charts/graphs). The Columns, which have expert opinions, analysis, and consumer insight.

Stay Ahead With The Business of Fashion

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Spiffed, dolled, gussied, or buttoned up, call it what you will.  The bizologie women have a severe weakness for clothing; it’s one of our beloved topics.  Today we’re paying homage to the Business of Fashion website, which is positively bursting at the seams with industry news, insight, and trend forecasting.  Founded in 2007 by Mr. Imran Armed, the website has built itself up to the point where it now deserves (and rightly so, in my opinion) being billed per Macleans Magazine, as “the Economist of fashion.” If you want articles particularly with a business research slant, look in the Archive (’07-present) where you will find several relevant categories to choose from, namely Global Briefing, Insight & Analysis, Intelligence, and Market Pulse.  From those categories you’ll find fabulously analytical articles like, “The Rise of New Business Models” or, “Online Fashion Retailers Tap Offline Opportunities,”  or, “Could Africa be the Next Frontier for Fashion Retail?

No go throw on some shiny shoes and have a great weekend!

Three Key Airline Industry Business Resources

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Combine a handful of interviews, a family reunion, and the prep work for an impending relocation, and I’ve been doing a bit more air travel than usual.  It's no surprise then that air travel is on my mind.   Here are three great resources for keeping your head in the clouds of the airline business: Point A: Airlines for America (A4A):  This professional organization is a premier industry advocate.  Their Economics & Analysis pages have a fantastic assortment of reports and press releases with scads of business data, including economic impacts, industry outlooks, and (in the Special Topics section) M&A and Bankruptcy transactions.

Point B: The Middle Seat by WSJ:  We love the WSJ, and it’s no wonder why, with articles like "How Airlines Spend Your Airfare" (includes a spiffy infographic!).  The Middle Seat is the WSJ’s freely available thematic column for all things travel.  Each individual article may not be strictly business related, but those that are yield excellent charts, stats, and glimpses into how airlines are thinking.

Point C: The International Air Transport Association (IATA):  A representative leader in the industry, this group also puts out densely-packed and downloadable industry reports forecasts, and analysis, which also often include excellent charts/graphs.  You’ll find them somewhat buried in: Areas of Activity > Economics.

Valuethiswebsite.com

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As the title implies ValueThisWebsite.com is one of the multitude of valuation tools for ballparking the worth of a url.  Of course the creators, for whom English is apparently a second language, do not disclose their secret recipe for how they are calculating said value.  (Read: take the number with a block of salt.)  If you go to another valuation site, you'll see different figures.  Nevertheless it aggregates a handful of nifty informative tidbits, including the IP address plotted on a google map, the Alexa ranking, visitation charts, and the reason why I like it for private company research- estimates of daily ad revenues. If you believe its valuation system, then it's useful for comparing public and private companies, e.g. Petsmart.com (public) vs. Petco.com (private).  Looking up URLs could give you an idea of the relative size and/or market share of Petco when it isn't spilling its guts to the SEC like the competiton.

One more thing: you might see the 'Websites with Similar Value' tab on the search results page, but it's really not worth your time.  It only returns sites with adjacent traffic rankings, not categorical competitors like the aforementioned pet supply stores.

A Gift Horse From Inc.com

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Because private company financial data is so tricky to uncover we’re always really excited, time and again, to mention any tool that helps us accomplish that task.  So what to do when you’re investigating how well a private company should be performing in a particular industry, but they’re not being forthcoming with figures? The good news: 1) You can check out this free toy from Inc.com: its Profitability Report.  For this content Inc.com sourced from Sageworks, which aggregates private companies’ financial data in order to “enable you to benchmark a company's performance to its peer group.” 2) Choose a category from the list and see a neatly laid out chart that includes several important numbers such as: Sample Size, EBITDA Margin, Sales per Employee, Current Ratio etc. 3) And if you’re a bit rusty on your accounting vocabulary, it provides simple explanations below each term.

Now the bad news: 1)  Inc.com loudly touts a calculator feature, but unless I’m sorely mistaken, this calculator does not in fact exist as of this writing.  Hopefully it will be available in the future. 2)  Another important caveat is that the industries covered are very broad.  If you’re trying to open a new theater chain, pretty much the only relevant category is “Arts, Entertainment, and Recreation,” rather than “Theaters.”  Hence the validity of this data could be questionable depending on the type of research you're doing. 3)  I visited the Sageworks mothership directly to see if they had a better version of this tool.  They didn’t, and instead they asked me to sign up for a single sample report.  Meh.

Trends Magazine

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If you’re, oh say a VC firm, and therefore trying to stay- not just abreast but ahead- on the business frontier, then Trends Magazine is a good place to start.  According to its About page, the Trends editorial staff of business experts, have a secret sauce of, among other things, “tips, inside information, privately distributed reports.”  bizologie sure likes the sound of that! The publication’s Economic Outlook reports take big-picture looks at primiarly our country, while its Research Library covers a range of relatively more focused topics like investments, nanotechnology, and energy.  A couple of particularly tantalizing article titles include, “A New Trajectory for Moore’s Law” and “Solving the Global Water Crisis Moves Beyond the Technical Feasibility Stage”.

Of course only the introductory paragraphs are free, but we wouldn’t leave you bereft right after telling you all about the magazine.  For those with limited pocketbooks, or perhaps those needing only the occasional article, the good news is that Trends is a current subscription in the Business Source Complete database, which as we have mentioned before, is likely freely accessible in your vicinity.

Thank you, GlobalData!

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Dearest darling GlobalData, We adore you for devoting a bookmark-worthy Media Center to those of us who are perpetually jonesing for great industry news articles.  You must have been following our blog entries like this one and this one, because you know that the best way to our hearts- ok actually probably the left hemisphere’s of our brains- is through freely available news and analysis.

You woo us not just with the standard page of Press Releases but also with an Expert Insights page covering categories like Alternative Energy and Medical Devices.  Your headliner titles like, “Hydropower's Hold over Indian Renewables Market Set to Decline” make us all giddy and flustered with all that forecasting.  And we love a company that is open to communication; email alerts for emergent research in our category of choice is such a turn-on.

Of course you might break up with us when you figure out that we librarians can’t afford to actually buy any of your full-length market research reports or take you up on one of those consultations, but there are plenty of fish in the sea.

Hugs and kisses,

bizologie

The CDC Under Magnification: Part Two

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Wouldn’t you know, watching the very smart movie Contagion last night would get me psyched to write this second installment on the CDC?  This part deals with the National Center for Health Statistics, a CDC subset that works to, “compile statistical information to guide actions and policies to improve the health of our people. …Working with partners throughout the health community, we use a variety of approaches to efficiently obtain information from the sources most able to provide information” (About). For someone trying to do business research through the NCHS website for the first time, be forewarned that these pages, understandably dense with information, have a nearly overwhelming barrage of links, terminology, and acronyms-that-all-sound-the-same.  My advice is to acclimate to the site’s organization by starting at the beginning:  use the left-side navigation menu to peruse the NCHS’s various Surveys and Data Collection Systems’s sub-pages on an individual basis to see which one might offer information that’s relevant to your research.  If a particular survey sounds promising, then also stick to that left-menu’s Survey Results & Products link, or any comparable link, when they're available.

In this manner, I managed to drill down to a site that breaks the National Hospital Discharge Survey, one of the  more exhaustive surveys, into spreadsheets of information based on popular aggregating factors.  (Alas, I don't know if this url and my last link are persistent).  For example, I downloaded a chart that gives me totals for “all listed procedures” from hospitals by category and age, meaning I see things like the number of appendectomies performed in the 15-44 age group.  This type of information is great for those trying to compile a numerical justification for their newfangled product or pill.

The CDC Under Magnification: Part One

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We’re lucky to live in a country where our government collects and disseminate scads of information for free, case in point, the Centers for Disease Control and Prevention.  Of course nothing is easy with our government, and the CDC website is no exception, mostly due to its sheer scale.  So, having nothing better to do, being kind and selfless, I decided to spend some quality time frolicking through the CDC.gov realm in order to point out a couple highlights that are relevant to business researchers. First and foremost, the Features -> Data & Statistics Page lends itself particularly well to background and/or market validation types of research.  It has been going strong since 2007, and it covers a surprisingly wide array of topics concerning our health.  Interested in opening up a recovery center?  Check out the 2011 Painkiller Overdoses report.  Selling hearing aids?  Read the 2010 or 2011 Infant Hearing Loss report.   Manufacturing air conditioners?  See the 2009 Working in Hot Environments report.

These reports are presented in a format akin to the brief executive summary, with a sprinkling of impactful charts scattered among a handful of paragraphs (including citations).  The bottom of the reports will also feature a series of links to related resources that might, depending on the institution, freely provide their own information too.

The Sweet Sound of… Data

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I was getting my hipster on, listening to a song called Love Show by Skye, and for whatever deep reason, it prompted me to think about researching the music industry.  Without further adieu, I've put together a list of five great resources, in no particular order, for freely available music industry research: 1.  The RIAA-  Not necessarily the first name we associate with “giving stuff away freely,” but the infamously-terrifying-to-college-students trade group has a research tab that includes downloadable reports on shipment data, music’s economic impact, and of course, the effects of piracy.

2.   The IFPI- aka the International Federation of the Phonographic Industry, it’s another major industry trade group akin to the RIAA, and in fact the RIAA links to a handful of the IFPI’s reports from its research page.  Nonetheless, it deserves its own mention, especially for its in-depth Digital Music Report that it has published for five years now.

3.  Digital Music News-  Not only does it sport a spiffy logo, but it also has an excellent selection of industry news and graphic-laden summaries of studies with titles like:  “92% of Music Fans Still Prefer Ownership...”, or “81% of iTunes Collections Never Get Played. Ever...”, or “Whoa: 3 Stores = 94.4% of Indie Digital Revenues...”.  It returned great results with keyword searches like: “study” or “trend” or “marketing”.

4.  Billboard.biz- The business research offshoot of the main Billboard publication, it has several categories of industry news, e.g. retail or branding, plus genre-specific news too, e.g. Latin or Dance.

5.  The Music Business Research Blog- A 2+ year blog that’s going strong, it’s run by Dr. Peter Tschmuck, an industry expert and university professor.  Concerning this endeavor, he states:  “This blog for Music Business Research is designed as a scientific discussion forum on all issues of music business/industry in all its manifestations.”  Not only is it an intelligent blog, but it also includes downloadable theses and papers that were generously contributed for Dr. Tschmuk’s cause.

Enthused for Ethical Consumer

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As the green movement evolves and companies try to better attract new consumers and maintain old ones, they need to focus increasingly on not only whether they (and their competitors’) goods are made of x% recycled materials, but also whether overall they are operating a good business. Enter the Ethical Consumer Research Association Ltd.  This UK based company has offerings in products/services research for consumers, and consultancy services for businesses, by training a high-powered-morally-righteous-lens on the companies producing them.  Ethical Consumer scores the brands based on 19 factors broken down into these categories:  animals, environment, people (e.g. workers’ rights & supply chain management), politics, and sustainability.

And since they are such a nice company, we appreciate that they’re freely giving away with registration, 1) the surface-level charts of companies’ scores on everything from bread making machines to travel insurance, and 2) lengthy reports on the ethical factors impacting that good/service that you’ll find by scrolling down the page.

Check out their current freebie chart for cell phones.  Based on the example of the phones’ abysmal scores, one can readily see the potential for brand differentiation by evolving into a halo-worthy institution.

Business Research Meets…Purses?

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While the bizologie authors all exhibit a weakness for Coach handbags, this entry is not a game of  guess your clients’ income by who’s not wearing a fake.  Recently I had an excellent interaction in a Coach boutique which I visited to exchange a bag, and the sales associates referenced an online consumer forum multiple times during my time there, e.g. “Oh I think the talked about this color on The Purse Forum.  They’re major enthusiasts on The Purse Forum.  They’re way ahead of the game on The Purse Forum”.  This intrigued me, so the next day I visited TPF and found a market research gold mine. Now when most people use the term gold mine, they mean “everything I wanted in one spot.”  That’s more likely the other gold analogy, the one involving pots and rainbows.  TPF, in terms of business research, comes across as a literal gold mine, with a lot of nonrelevant (to business researchers that is) information to be found throughout, and the occasional vein of free-focus-group-qualitative-information-gold.  These are serious Coach connoisseurs who are not only giving impromptu product reviews, but also candidly answering topics like:  “Do you no longer like Coach?  If, so, then why?”  (Answer: Lots of them move on to higher price point brands like Hermes or LV).  Or, “For those who own more than a handful of Coach bags, why do you buy?  (Answer: Thrill of the hunt; they often re-sell their stash on ebay and purchase their new must have).

Obviously one could create an account, insinuate themselves into the forum’s culture, and ask incognito questions.  And obviously the Coach employees are monitoring TPF, which begs the question of precisely who starts some of these more probing threads.  Hence TPF (which also discusses scads of other handbag brands and other luxury goods) and other comparable consumer forums are definitely something to consider for people doing qualitative-type business research, especially for the aforementioned luxury/consumer goods.  So long as the researcher is respectful of that community’s enthusiasm and expertise, they might find themselves a gold nugget or two.

One Organization To Bring Them All

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SCIP used to stand for the Society of Competitive Intelligence Professionals, but as of summer 2010 it changed that name to Strategic and Competitive Intelligence Professionals.  No matter what name you call it though, the SCIP is an organization dedicated to supporting people who work in the Competitive Intelligence industry. Ever the dutiful researcher, I spent some quality time on their relatively dense website, and here are five key takeaways to consider before taking, what could be a good chunk of time, to visit:

1. Finding:  SCIP is just over 25 years old, and as of now it enjoys participation from just over 20 chapters scattered about the United States.  Conclusion:  The odds for networking look pretty good.

2. Finding:  Not surprisingly, the SCIP’s reports and educational manuals come at a price, but the price point is usually $50-$100 depending on membership status.  Conclusion: These are a good investment in training materials that could become touchstones for a fledgling CI department, or for those who want to cultivate a new skill set.

3. Finding:  The SCIP News Archive has a broad swath of articles about the CI industry, grouped by month, dating back to 1998; unfortunately the only navigation available is scrolling.  Conclusion:  If you want to turn the spotlight around and study CI itself, this is a solid, if slow, place to start.

4. Finding:  The monthly ebulletin dubbed scip.insight., is a compilation of free articles from SCIP bigwigs that have insider perspectives you’ll be hard pressed to find elsewhere.  Conclusion:  It’s much more satisfying for non-members to peruse this resource instead of the magazine, as most of those volumes are password protected.

5. Finding:  As of this writing the job web has 134 highly relevant postings kept up to date.  Three are from this past week alone.  Conclusion:  Bookmark this site if nothing else for the job web, where you’ll find new openings and keep abreast of what the field demands for new hires.

De-shark-ifying

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At bizologie we’re actually big animal lovers, so please don’t take this post’s image too literally.  Sharkrepellent.net is not the oceanic equivalent of bug spray but rather, according to its parent company FactSet, a “corporate governance database,” which, “provides takeover defense and corporate governance data for more than 5,600 U.S. incorporated public companies.” To use Sharkrepellent.net’s services to the fullest extent, a company would need to purchase an account.  Luckily for us intellectual freeloaders though, they provide near the top of their homepage a nondescript link to their reports archive that dates back 10 years.  It’s full of short yet detailed- including spreadsheets and graphs- reports concerning all things poison pills, proxy fights, activist tactics, and hostile M&A’s.  For those who find corporate dramas riveting reading, or those with the potential to have a Conglomo breathe down their neck, it’s definitely worth dipping a metaphorical toe in the water and visiting the archive.

Bookmark Futurity…

Futurity

…but be forewarned that it’s highly addictive.  In a nutshell Futurity.org's akin to the colorful see & be scene watering hole, the one with an amazing happy-hour special where all the hip people go to flaunt themselves.  Only the colorful characters are the top research universities in the US, UK, and Canada, and what’s being flaunted isn’t skin or fashion but research findings.  (Granted, some of those findings could theoretically be about skin or fashion, but I digress.) Now research findings may not immediately sound interesting to everyone, but with highly catchy titles, one-pager lengths, and summaries that aren’t painfully erudite, it’s easy to find yourself thinking, “I’ve got three minutes.  I’ll just click on one more link because I really want to know how they figured that out.”

Futurity breaks its research headlines into four categories: Earth & Environment, Health & Medicine, Science & Technology, and Society & Culture.  For business researchers, that last category may have the most draw, with tantalizing headlines like: Super food: Shoppers will pay 25% more, or Exports + R&D = competitive edge. The other categories though often highlight emergent technologies that have the potential to form the basis of for new or niche markets, so they are worth looking into as well.  Who knows?  If nothing else you may read a study that’s a nifty conversation starter for the next time you find yourself at your local see & be scene watering hole.