The start-up scene in Africa is rapidly growing with so many start-ups coming up with great ideas that will change the continent. Most of the business ideas tend to be associated with our hobbies, passions, strengths or even the resources that are at our disposal. However, it’s easy to be carried away with that idea and proceed to set up a business without testing its viability.
It’s not always smooth sailing in the startup world if you doesn’t invest in some form of research.
Being the global pioneer in mobile messaging back in 2005, Mxit’s story was poised to be of success, back then when feature phones were the norm. Based in South Africa, their success was short lived when smart phones were introduced into the market, and Mxit wasn’t able to keep up.
It eventually released Mxit 7, but found it difficult to catch up with other mobile messaging applications such as whatsApp and Facebook.
With close to 100 million users by 2014, Mxit lost ground and shut down its commercial operations 2015. This wouldn’t have been the case if market research would have been prioritized as a continuous process for a growing company which needed to understand evolving technological trends.
In a podcast interview with Chattanooga Business Radio, entrepreneur, investor, and marketing consultant Alex Lavidge sites lack of market research as the biggest cause of failure for major startup companies who venture into business.
Alex explains that most startups are unable to differentiate between fact and assumption, and advises entrepreneurs to invest in quantitative market research in order to get the full scope of their market.
Startup founders shouldn’t land in the famous pitfall of not knowing the difference between assumption and fact. Sure, entrepreneurship is synonymous to risk- taking, but it’s double the risk to invest your time and finances into something you don’t know much about.
But, of course, market research often comes at a cost- with most research companies focused on serving the needs of big corporations. And it’s no secret that as a startup – you’re always working with a tight (or no) budget. It’s difficult to match the spending standards of more established companies.
Of course, you can always make use of free tools that are great for learning more about your target market. Sending out surveys to friends, family, colleagues and your existing network is a good start to understanding what you’re working with.
It’s refreshing as well to see companies like e-ENSURES who are looking out for the small business-owner. e-ENSURES is Africa’s first online market research company dedicated solely to pre-startups, startups, SMEs and entrepreneurs.
With an online community of respondents that’s in the thousands – they’re able to maintain much larger response rates than conventional survey sites. Engaging with an online panel (as compared to actual physical interaction) cuts their operational costs considerably, allowing them to make market insights available at a much more affordable cost. It also makes sure the research is reliable, by minimizing human error.
Not only are their research services affordable, but accurate too; boasting about half a decade of market research experience at a multi-national organization. Aside from tailored research, entrepreneurs can also gain access to their online market place where you can buy full market reports from just $9.
As, Eric Ries preaches in his Lean Startup Model, it’s important to test real things with real people – and measure your growth based on what you learn from your target market. It’s more than vital to have market research as an in-built ongoing process in your business plan, to be constantly informed on how you are placed in a competitive and dynamic market.
Also Read: Start-ups: There’s no business too small to benefit from data analytics