How to Do Market Research (Without Wasting Time and Money)

One of the biggest questions, whether you’re a first-time founder or a seasoned entrepreneur, is: “How to do market research the right way?”

In this guide, you’ll learn how to conduct market research on your own and realistically assess whether your business idea has real potential, or if it’s time to pivot to something more profitable.

Why Market Research Is the Most Important Step for Any Startup

You probably already know the answer: market research is what helps you prove (or disprove) whether your idea is viable and profitable.

No matter how innovative or exciting your idea is, if no one wants what you’re offering, there’s no profit. And without profit, even the best idea won’t keep your business alive. It’s that simple.

Still, many people fall into the trap of believing so deeply in their idea that they skip this step altogether. They dive in, invest all their time and money, and keep pushing until they run out of both.

In most cases, a bit of market research upfront could’ve saved them. It’s far better to find out early that your idea lacks demand than to burn out chasing something that was never going to work.

You might even discover that the idea isn’t bad, but the timing, format, or offer isn’t quite right. That’s good news: it means you can tweak and improve it before investing too much.

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Has Your Business Idea Been Tried Before?

Before you even start your market research, there’s a quick shortcut that often reveals a lot: check if your idea already exists, or if it used to exist.

Just type your business idea into Google. For example, if you want to create and sell a spinach and garlic sauce, search for “spinach garlic sauce.” Browse through the first 50 results.

If nothing comes up, or if you only see recipes, try adjusting your search to something like “garlic sauce price” or “buy spinach garlic sauce.”

You’ll usually end up with one of three results:

1. The product/service doesn’t seem to exist
2. A similar idea existed, but the business is now closed
3. A similar business is currently operating

Let’s break down what to do in each case.

No Similar Product or Service Exists

At first, this might seem like a positive development, but it could also be a warning sign. If no one is offering something like this, maybe that’s because there’s no demand.

Your next step is to determine who your target audience might be and whether they need what you plan to offer. (We’ll cover how to do that shortly.) You’ll also want to analyze potential costs and production challenges.

A Similar Business Existed But Failed

If a business with a similar idea once existed and no longer operates, that’s a sign to proceed with caution.

Find out why it failed. Was it poor management? A lack of demand? Too much competition? Something else?

If you can pinpoint the mistakes, you might be able to build a better version—or avoid the same pitfalls entirely.

A Similar Business Exists and Is Thriving

Great! That means there’s demand. But it also means you have competition.

This is your chance to analyze competitors. What are they doing well? Where are they weak? Can you offer better quality, lower prices, or something they’re missing?

Your job is to create a unique value proposition, something that makes you stand out. You might also consider targeting a different audience or location to carve out your own space in the market.

Once you know which of the three situations your idea falls into, it’s time for deeper research.

Why Asking Friends and Family Is the Worst Way to Validate an Idea

Most new entrepreneurs begin by asking friends or family for their thoughts on their idea. Sounds logical, right? These are people who care about you, who want you to succeed.

But that’s exactly the problem.

People close to you often won’t be honest if they think their feedback will discourage you. They’ll say it sounds great, even if it’s not. And worse, they probably aren’t your actual target market, so their opinion doesn’t reflect what real customers might think.

You don’t need encouragement, you need the truth.

You’ll get far more honest and useful insights by talking to potential customers who don’t know you personally and have no reason to sugarcoat their answers.

Researching Your Potential Customers (The Smart Way)

Now that you’re past the theory, it’s time to gather real-world feedback from real people.

The easiest way? Create a simple survey. Make it feel like a general research project, not a pitch. If people sense you’re trying to sell them something, they’ll either drop off or give biased answers.

Ask about:

• How do they currently solve the problem you want to address
• Which products or services do they use
• How satisfied are they with those solutions
• What they’d like to see improved

Also include:

• Age range
• Gender
• Location
• Anything else that helps you define your target group

Use neutral, open-ended questions to avoid leading responses.

Once your form is ready, share it on LinkedIn, Facebook groups, and anywhere your audience hangs out. Watch how people respond, then adjust the survey if needed to improve participation.

What Feedback Should You Listen To?

Let’s say you ask about your garlic spinach sauce idea. One person says they’d buy it—but only if it didn’t contain garlic.
Another says you should make a beetroot and turmeric version instead.
A third suggests an all-organic version with sweet potato.

You start thinking, “Why not? I could offer all of these!”
Before you know it, you’ve got 12 different sauces and no real focus.

Here’s the problem: trying to please everyone leads to a chaotic product line, diluted messaging, and—often—failure.

That doesn’t mean you should ignore feedback. Just don’t act on every single suggestion. Instead:

• Track which ideas come up repeatedly
• Group and analyze them
• Only act on patterns, not one-off opinions

The best feedback comes from two groups:

1. People who already use your product/service and can spot real improvements
2. Entrepreneurs who’ve been where you are and succeeded

Everyone else? Take their input with a grain of salt.

Real Market Validation, Before You Even Launch

You’ve done the research. You’ve defined your target group. Now it’s time to see if anyone will pay.

Because that’s the ultimate proof.

The fastest and cheapest way to test your idea is with a landing page, a simple web page that explains your product or service and invites visitors to buy (or pre-order).

There are two ways to do this:

1. Let people pay (just be clear that it’s a pre-order)
2. Simulate a full checkout process, but stop right before payment with a message like:
   “This product isn’t available yet—leave your email and we’ll notify you when it is.”

Either way, you track how many people went through the process. That’s your data. That’s your answer.

But Isn’t This Too Complicated?

Honestly, no.

This kind of test is way cheaper than building the entire business around a hunch. It gives you real-world proof that people are ready to pay—or it tells you it’s time to rethink.

Either way, you win.

How to Do Market Research in a Nutshell

• Never skip market research, no matter how good your idea feels
• Friends and family are not your target market. Stop asking them
• Don’t ask “Would you buy this?”, find ways to get honest, indirect answers
• Theory is useful, but not enough
• Don’t chase every suggestion, look for patterns in feedback
• The only real proof is if people are willing to pay
• Trust market data, not your gut

Boldizar S. Santo (Co-Founder)