Blindfolded focus group in mock kitchen taste testing meats in 1935 at the Department of Agriculture in Beltsville, Maryland.
Photograph by Smith Collection/Getty Images
By AllBusiness.com
May 7, 2016

This post originally published on AllBusiness.com.

If you’re putting together a marketing plan for your business and you need market research, consider conducting a focus group. Focus groups can help a company learn valuable information about customer attitudes and their perceptions about the business and its products or services.

Once only utilized by large companies, focus groups are now used by an increasing number of small businesses. They can help you determine how to target specific demographic groups, and their needs and desires.

Market research at the ground level

Focus groups can be considered market research at the ground level. By having direct interactions with your customers and prospects in a small group environment, you can use real-time feedback to help move your business forward.

Whether your business is in its formation stage or mature stage, the critical information you obtain from a focus group can be reviewed and analyzed to develop future marketing plans by:

  • Estimating the potential size of your market
  • Assessing potential customer interest before you introduce new products or services into the marketplace
  • Accumulating information about the needs, motivation, and purchasing decisions of your customers and prospects

Easy on the budget

Although a marketing research firm can be hired to organize and facilitate a focus group, you can keep costs low by doing the work yourself: locating a facility, finding participants, doing the planning, and conducting the session.

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The data obtained in relation to the amount of money you spend can be invaluable considering marketing dollars in a small business should be used effectively and hit the mark every time.

5 Tips for conducting a focus group

Establishing a representative sample of your target market is crucial for obtaining valid information to formulate a marketing plan. Follow these tips to conduct your own focus group:

  1. Representation: Assemble a group of 10 to 12 screened customers and prospects that your business is trying to reach, ensuring that they represent your target market. If participants do not represent your market or are too narrowly focused, the results will be skewed, and possibly, not useful.
  2. Moderator: It’s the moderator’s job to keep a focus group on topic and to elicit needed responses. A moderator can can be the business owner, a business associate, or a professional who can interpret subtle clues including body language. An advantage of using someone other than the owner is to bring an unbiased approach to the proceedings while at the same time encouraging full participation and a lively, beneficial discussion.
  3. Comfortable setting: Choose a comfortable setting so participants feel relaxed and ready to engage in the forthcoming discussion. Rather than conducting the focus group at your actual business location, which can produce a certain amount of bias, it’s best to find a facility specifically used for focus groups–a general meeting room at a hotel or business building–or host an informal dinner at a restaurant with a private room.
  4. Recording: In addition to taking written notes, be sure to record the entire event. Recording allows you to review the proceedings later without interruptions. Obviously, everything cannot be written down while the focus group is in session and many observations and conclusions will be missed. Recording can supplement written notes and quick observations.
  5. Multiple groups: Depending on how much you’ve budgeted for focus groups and the amount of time you have available, multiple focus groups can be used at different times. This will allow a variety of responses from different participants. The larger amount of data that is compiled can be analyzed to determine if results are valid and consistent.

 

Focus groups produce value

Focus groups can provide valuable market research for your small business. They can answer numerous questions regarding your marketing strategy, products, services, branding, pricing, and reputation of your business and your competitors.

The marketing advantage goes to businesses that understand why customers buy, so they can sell benefits and solutions, offer superior customer value, and create a favorable experience so customers return again and again.

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