Is this what startups need right now? Complementary Market Information at all cost?!

Why does an online paid market report (Market Research, Market Review) cost an average 2800$ and more? Do not expect me to answer because I do not know. If you look at some of the reports offered by well-known research teams, you will find the cost of 3500$, and heading north.

Now, put aside fake reports and charlatans, some reports might be worth every penny and fit as a pair of gloves to the needs of the consumer.

How many times have you heard of people who purchased the report and complained? None. How many times did they use, at the most, 15% of the data mentioned in the report? Many. How many reports get deeper into analysis and deliver insightful action items? Trust me, few. Most of the research teams are afraid to be held responsible for their findings, legally responsible. How many reports actually use common market analysis models, academic models, in their work? Few.

In this short article, I will discuss the correlation between the need for business information, the reasons this information is needed, and the right kind of report to match these needs.

The comprehensive, expensive market research reports, offered online and/or outsourced to well-known research teams, are costly and usually fit the needs of a well-established, mature company looking for new business patterns, in many cases, before they accept the fact that they entered the stable positioning or in the worse case, they entered the decline. They need to renew or fix their strategy and they assume that by acquiring an expensive market research report, they will gain the necessary "bling" to put them back in the saddle. Allow me not to elaborate further on these reports because they are my competitors and I respect them.

On the other side of the businesses scale stand startups and fast-growing companies who just got into the market and found that their scalability plans need to be immediately implemented. What are their market research needs, and for what reasons? Answering that, requires you to get inside the head of a startup manager or managerial team which often consists of 4-5 entrepreneurs.

I will tell you what they do not need. They do not need primary research data done by an external company, they do not need a deep understanding of their competitors and they do not need a cross-regional analysis of their prospect market. Most of the new and growing companies are pointing to one market to start with. I can tell you that an average Israeli-based startup (meaning; the managers are Israelis, and they live in or spend much time in their prospect market), well, they see the US as their primary market, preferably, in mid-west countries.

For what do they need market reports? In this early stage of business experience and competitive conduct, the two main reasons for acquiring market and competition information are:

·       Creating the perfect investor pitch

·       Forming the primal business strategy

These two factors; money and strategy are the most significant aches a new company's managerial team suffers from. And if they do not find a cure for that suffering, they cannot do the real work, meaning; they are stuck in the procedure and cannot implement their innovative solution. There are many terms for this situation: "Lack of Oxygen", "Don't know left to right", etc. The need is clear, they need supporting data to successfully pass the finance barrier and to stand on the strategic track.

When standing in front of an investment committee, a sole investor, or an angel, it feels like an interrogation. You are asking someone strange to give you money and to have trust in your promise for a positive ROI. Investors decide on whether to give you money or not on two main factors. First, are you a trustworthy person? Do you make them feel comfortable talking to you and hearing you out? Do they sense the hunger in your body language and your spoken language.? Second, do you know your business, market, competitors, consumers, trends, and legal landscape? They do not miss anything around these topics. They need to assess the risk they take in giving you money. As long as you play ball and shoot answers like you shoot the ball to the basket, they feel relaxed, and their fears decrease.

The second key factor is forming the primal business strategy. Why primal? Because strategies have the potential to change as the company grows. It is advised to update the company's strategy after the full circle of a yearly competitive checkup (Starting with SWOT, and through more analysis stages, which are the subject of a different article). And occasionally, every 3-4 years, to rethink the current strategy and adapt it to the new attributes of the ecosystem the company operates in.

The task of forming a strategy for a startup or a young growing company is sometimes a great challenge to the managerial team because in many cases they don't have the knowledge nor the experience needed for that, and in many cases, they use the services of an external consulting company and/or bring to the board an external experienced manager to form the strategy and lead the company.

What is a strategy? Especially primal strategy is a theory, an educated guess, a bet on what direction to navigate the company to outcompete the adversaries. The beliefs of the leaders on the best way to enter the troubling waters of competition, to swim alongside your competitors and consumers, to catch the high waves of opportunities, and to avoid turbulence. To form a solid reasonable strategy, especially when there is no relevant self-data, one must rely on experience and supporting data as well as on benchmarking analysis relevant to the industry and ecosystem you operate.

Now, that we have understood the two factors and derived the needs, it is evident that these early-stage companies need supporting market information, some kind of a DSS dataset, and a comprehensive report that allows them to get the right answers for the investing interrogation as well as deciding on a way to enter the market and start competing, hence strategy.

This report includes all relevant information, current information, about the market circle, it addresses the elements affecting the unique value chain of the company's solution, it reflects opportunities and threats to be considered in the first step of business conduct and competing and it includes a structured analysis of the market and consumer behavior by leading models (I can guarantee it in the case of Webintelligency's Market Review Reports, and hope to find it in other alike reports).

The market review report (I can speak of Webintelligency 's) is based on publicly shared information, legally obtained, and collected. Why is that important? When using the information in a pitch or a strategic plan, you do not want to use data that has not been publicly shared. The brains of such a report are not the actual data, but rather the means of finding it and analyzing it in a way that makes sense to the managerial team and assists them in making… what? Yes, the exact educated guess that lies in the heart of their strategic approach to their market.

To conclude this article. Let me say that in business school we learn that a product must align with a need. In the competitive and market research industry, it is the same. Although a market report seems to be generic and fits all needs, there is a difference between a deep analysis, cross-industry/region analysis, competitor-centric analysis, consumer-centric analysis, regulatory and legal landscape review, etc. Each report has its attributes and answers different questions, hence fits diverse needs and information gaps.

This article focused on the right report for the needs of a startup company and a young fast-growing company, SMEs and SMBs. I did not get into the framework of such a report nor the generic chapters and analysis methods. These are a subject for another article. The segments of startups and fast-growing SMBs are the target segment for Webintelligency. We specialize in delivering fast, current, and insightful comprehensive market reviews that fit the needs of the leading team in startups and young growing companies.

Feel free to contact us for more information and an offer.