Market Research
Before you build any product, look before you leap. Assumptions about what customers want are how businesses fail — market research replaces guesswork with evidence about real problems, real desires, and the price people will actually pay.
Executive Summary
Market research, in one read.
Replace guesswork with evidence
Assuming what customers want leads to failure. Market research uncovers their real problems, desires and the value they place on a solution — before you invest in building it.
Primary and secondary
Primary research gathers fresh data directly from people; secondary research draws on existing data, mostly from the internet, to understand the market and what to make.
Five steps, simple tools
Study your competitors’ reviews, ask customers their problems, the value they’d pay and how hard it is to solve — using simple tools, or an agency for a big bet.
Visual Knowledge Map
One discipline, five building blocks.
Core Concepts
The ideas behind researching a market.
Two kinds of research
Primary is first-hand — you ask people directly. Secondary is desk research — you gather existing data, mostly online.
Assumptions kill
Guessing what customers need, instead of researching it, wastes money, time and effort — and sinks products.
Pain points and desires
Research surfaces both the problems customers face and the goals they aspire to — the two things your product must address.
Perceived value sets price
The monetary value a customer attaches to a benefit guides your pricing — high perceived value, high price, as with diamonds.
Hard problems pay more
The harder a customer believes a problem is to solve alone, the bigger the premium they’ll pay you to solve it.
DIY or agency
Run basic research yourself for a small bet; hire an agency for a big investment — agencies cost more, so match the spend to the stakes.
Frameworks & Models
Two types, and the six reasons to do it.
Primary vs secondary research
- Meet people and ask about their problems.
- Collect a sample database.
- Select people, ask questions, and read your answers from their statements.
- Search the internet to collect existing data.
- Understand how to enter the market.
- Work out which product you should make.
Six reasons market research matters
It reveals customers’ current problems — if they need funds, for instance, you can build a financial product.
It surfaces their expectations, goals and desires, so your product or service can fulfil them.
It guides the features of the product, shaping it around what customers actually want.
Ask the problem, then ask how they’d feel if it were solved — their answer is the benefit you pitch.
It helps you keep improving your existing product over time, as needs change.
Assumptions lead to failure. One founder once sank money, time and effort into a product that flopped — because they assumed needs instead of researching them.
Process Flow
The five steps of basic market research.
Relationship Diagram
How research feeds the business.
Dependencies & Interactions
What good research leans on.
| Outcome | Depends on | Reinforced by | Failure mode |
|---|---|---|---|
| A product people want | Evidence, not assumptions | Primary and secondary research | Building on a guess about needs |
| A better offering | Reading competitor reviews | Repeating 5-star, fixing 1-star | Ignoring what rivals teach you |
| The right price | The value customers perceive | The amount they attach to the benefit | Pricing with no sense of value |
| A premium | A problem that’s hard to self-solve | Customers who’d rather pay you | Easy problems priced like hard ones |
| Affordable research | Matching spend to the stakes | DIY for small, agency for big | Paying agency rates for a small bet |
Key Takeaways
Ten lines to keep.
Research before you build — assumptions cause failure.
Two types — primary (direct) and secondary (desk).
Find the pain points and the desires.
Design the product around what you learn.
Build the pitch from the problem and its benefit.
Copy competitors’ 5-star, fix their 1-star.
Ask the value customers place on the benefit.
Perceived value sets price — like diamonds.
Harder problems command a premium.
DIY for small bets; an agency for big ones.
Revision Sheet
Glance, refresh, reflect.
- Research before you build.
- Primary (direct) vs secondary (desk).
- Find pain points, desires, value.
- DIY for small, agency for big.
- Copy competitors’ 5-star points.
- Fix their 1–2-star points.
- Ask customers their problems.
- Ask the value and the difficulty.
- Perceived value → the price.
- High value, high price (diamonds).
- Hard-to-solve → a premium.
- Problem → benefit → the pitch.
Quick Reference Table
Tools to run a market survey.
| Tool | What it does | Best for |
|---|---|---|
| Spreadsheet | Write a set of questions and collect customers’ answers in a grid. | Quick, simple questionnaires |
| Online form | Build a form with questions and options; link it to a sheet to see who answered what. | Structured surveys at scale |
| Survey platform | A dedicated website for designing and sending questionnaires. | Richer survey features |
| Social-media groups | Share your form and gather feedback from relevant online groups. | Tapping an existing audience |
| Email list | Send the form to your whole list of contacts. | Surveying people who know you |
Frequently Asked Questions
The questions this raises.
Primary is first-hand — you meet people, ask about their problems and gather a sample directly. Secondary is desk research — you collect existing data, mostly from the internet, to understand the market.
Because assumptions cause failure. It reveals pain points and desires, guides the product’s design and your pitch, helps you improve over time, and saves the money, time and energy a wrong guess would waste.
Read their reviews. Note why they earn 5-star ratings and repeat those things; note why they earn 1- or 2-star ratings and improve on them in your own offering.
Ask customers the value they’d attach to the benefit — the amount they think it’s worth. The higher the perceived value, the higher the price you can charge, just as diamonds command a high price.
Ask how hard customers think the problem is to solve themselves. The harder they believe it is, the bigger the premium they’ll be willing to pay you to solve it for them.
For a big investment, yes — a market-research agency goes deep. For a small bet, run basic research yourself, since agencies are more costly than a simple DIY survey.
Memory Hooks
Lines that make it stick.
Guessing what customers want is how products die.
Primary is first-hand; secondary is desk research.
High perceived value, high price — like diamonds.
The tougher it seems, the more they’ll pay you.
Practical Applications
Turn answers into a pitch and a price.
Build a sales pitch from a problem
Ask the problem. Ask the customer directly what problem they are facing, and let them describe it.
Ask how they’d feel if it were solved. Their answer names the benefit they’d gain once the problem disappears.
Pitch that benefit. Tell customers how your product delivers exactly the benefit they just described — that’s your sales pitch.
Price from value and difficulty
What it’s worth to them
Identify the monetary value a customer attaches to the benefit. The more they value it, the more you can charge — high perceived value is exactly why diamonds are priced so high.
The premium for hard problems
If customers think a problem is very hard to solve on their own, they’ll pay a premium for you to solve it — difficulty raises what they’ll happily spend.