Market Research

Overview

Market research answers the questions your gut cannot: How big is this really? Who's already here? What's coming? What do customers actually look like? This playbook gives you a repeatable system using mostly free tools. Run it before launching, and refresh quarterly.

Step 1: Define Your Research Questions First

Never open a browser without knowing what you're looking for. Write 3-5 specific questions. Everything you find must map back to one. Examples:

• How large is the addressable market for [X]?
• Who are the top 5 competitors and what are their actual weaknesses?
• What macro or industry trends will shape this space in the next 12-24 months?
• What does a typical customer in this market look like demographically and psychographically?
• What price points do existing solutions charge, and where are the gaps?

Step 2: Market Sizing (TAM → SAM → SOM)

You do not need exact numbers. Order-of-magnitude is enough to make decisions.

TAM (Total Addressable Market): Everyone on earth who theoretically has this problem or need. Often found in industry reports (Google "[industry] market size report").

SAM (Serviceable Addressable Market): The slice of TAM you could realistically reach given your language, geography, channel, and positioning. Apply realistic filters: "Of the global TAM, how many are in English-speaking markets? How many use the platform/channel I can reach?"

SOM (Serviceable Obtainable Market): What you can realistically capture in Year 1. Typically 1-5% of SAM for a new entrant.

When no report exists — estimate from first principles:

1. Find a related population stat (e.g. "There are 60M freelancers in the US").
2. Apply a conversion funnel: "20% use project management tools → 12M. Of those, 10% have the specific pain I'm solving → 1.2M."
3. Multiply by realistic ARPU: "If each pays $15/month → $216M TAM."
4. Sanity-check against competitor revenue if any are public.

Decision rule: If your realistic SOM < $500K annual revenue potential, the market is too small to sustain a solo business at a healthy margin. Consider a broader niche or higher price point.

Step 3: Free Data Source Toolkit

Market size & industry data:

• Google "industry name market size" — even headline numbers from reports are useful
• Statista (free snippets give key stats)
• IBISWorld, Grand View Research — free summaries
• SEC filings of public companies in the space (revenue, growth, strategy)
• Bureau of Labor Statistics — workforce and industry employment data

Competitive & product intelligence:

• Competitors' websites — pricing pages, feature lists, careers pages (hiring reveals strategy), blog topics (reveals what they think matters)
• G2, Capterra, Trustpilot, App Store — read 20+ reviews minimum. Categorize complaints.
• SimilarWeb (free tier) — traffic volume and source breakdown
• Crunchbase (free tier) — funding history, investors, founding dates
• LinkedIn company pages — headcount trends (growing = healthy signal)

Trend & signal intelligence:

• Google Trends — search interest over time
• Reddit — search within relevant subreddits for recurring themes
• Product Hunt — what's gaining traction in adjacent spaces
• Y Combinator batch announcements — what's getting funded signals what's coming
• Twitter/X — real-time industry conversation
• Industry newsletters — find 3-5 relevant ones and read for 2 weeks before deciding

Step 4: Competitor Landscape Mapping

Map your top 5-7 competitors (or adjacent players if direct competitors are few). For each, build a profile:

NAME:           [Company name]
URL:            [link]
FOUNDED:        [year]
FUNDING/REV:    [what's publicly known]
TARGET:         [who they serve — be specific]
VALUE PROP:     [one sentence: why customers choose them]
PRICING:        [model + price points]
TOP FEATURES:   [3-5 things they do well]
STRENGTHS:      [from their marketing + positive reviews]
WEAKNESSES:     [from negative reviews and feature gaps]
TRAFFIC:        [SimilarWeb estimate]

After profiling all competitors, synthesize into three lists:

1. Table stakes — things ALL competitors do. You must match these or customers won't consider you.
2. Universal gaps — things ALL competitors do poorly or skip entirely. This is your opportunity.
3. Underserved segments — customer types that no competitor targets well. This is your niche entry point.

Step 5: Trend Analysis

Identify 3-5 trends relevant to your market. For each, assess:

1. What is the trend? (be specific, not "AI is big")
2. Evidence: 2-3 concrete data points or examples.
3. Maturity: Emerging (< 20% adoption) / Growing (20-50%) / Maturing (50%+) / Declining.
4. Impact on your opportunity: Tailwind (helps you) / Headwind (hurts you) / Neutral.
5. Action: What should you do because of this trend? (Build for it / Watch it / Ignore it / Avoid it)

Step 6: Customer Persona Construction

Build 2-3 personas. These are not marketing fluff — they are decision-making tools. Every product, pricing, and messaging decision should be testable against "would Persona X care about this?"

PERSONA NAME:     [fictional but grounded in data]
ROLE & INDUSTRY:  [specific]
SENIORITY:        [junior / mid / senior / founder]
COMPANY SIZE:     [solo / 2-10 / 11-50 / 50+] (if B2B)
LOCATION:         [region or work style: remote/hybrid/office]
ANNUAL INCOME:    [range — relevant for pricing decisions]

DAILY REALITY:
  - What does their typical workday look like around [your problem area]?
  - What tools do they already use in this workflow?

PAIN POINTS:      [top 3, ranked by severity — pull from reviews and interviews]
GOALS:            [what they're trying to achieve professionally]
BUYING BEHAVIOR:  [how they discover tools, decision timeline, budget authority]
CHANNELS:         [where they spend time online — critical for marketing later]

QUOTE:            [a real or realistic quote capturing their mindset — pull from forum posts or interviews]

Step 7: Compile and Act

Produce a single Market Research document containing:

• Market size (TAM/SAM/SOM with sources)
• Top competitor profiles + synthesis (table stakes, gaps, underserved segments)
• 3-5 trends with impact assessment
• 2-3 customer personas
• Recommended next actions — numbered, specific, prioritized

Schedule a quarterly refresh. Markets move. What's true today may not be in 90 days.

Market Research Mistakes to Avoid

• Researching without a question list. Spending hours reading without clear questions produces a pile of information with no actionable conclusions.
• Treating TAM numbers as meaningful without sanity-checking them. A $50B market that you can realistically capture $50K of is not a big opportunity.
• Only reading competitor marketing copy. Read their negative reviews — that's where the real gaps live.
• Skipping primary research. Desk research tells you what's written down. Talking to people tells you what's actually true.
• Doing research once and never revisiting. Markets shift, competitors pivot, trends accelerate. Stale research leads to stale strategy.
• Letting research become a substitute for action. The goal is a decision — go, no-go, or pivot. Cap your research phase and force a conclusion.