How to conduct customer research in a foreign market to validate your start-up idea

Conducting customer research in a foreign market is a crucial step to ensure success in a new market. But it can be a daunting task when your customers are thousands of miles away. 

Even the largest companies, in the past, have had to roll back expansion plans because of poor market research. Remember when Walmart realized their peppy, friendly staff training creeped out customers in Germany, or how Starbucks failed to understand how loyal Australians were towards their local cafes? 

As a start-up, you may feel like you don’t have the resources that larger companies do to conduct country-wide market research, but the benefits of validating your product-market fit before entering a new market trump all other activities before launching. Market research is worth the effort because it helps:

  1. Identify your TG, understand their needs and preferences
  2. Assess the size market size and growth potential
  3. Understand the competitive landscape 
  4. Identify gaps, risks and challenges in the market
  5. Inform product development and marketing strategy

In this guide, we will introduce you to a multitude of Canadian resources that can help you make smart business decisions and help you gain confidence in your start-up relocation or expansion plans. 

Types of International Market Research

There are two types of market research: primary and secondary.

Primary research is research tailored to your specific need. Its outcome is original data that is not available through any other source than your own. Some examples of this are surveys, interviews, and focus groups. 

Secondary research includes collecting and analyzing information already available in the market. These may be curated for purposes other than your need. Some examples are government statistics, industry reports, and company financial statements. 

How to Conduct Primary Market Research in Canada

TBDC's Advice for How to Conduct Primary Market Research

Interview local experts
Talk to consumers using online surveys
Use focus groups for more data
first need to master the art and science of creating an effective questionnaire
  1. Interview local experts in Canada: Industry experts are just a click away if you know who you want to talk to. Identify experts on LinkedIn, Youtube, and Instagram, and reach out to them for a one-on-one meeting. Even if they charge for their time, the insights you can extract are invaluable to the future of your business. 
  1. Talk to consumers using online surveys: Google Forms, Typeform, and Survey Monkey have made creating smart forms and collating data very conveniently. With easy-to-use drag-and-drop UIs, you can make original market research surveys in minutes and circulate them to potential customers. 

Potential TGs can be identified through online groups on Facebook and LinkedIn. You can leverage your existing network of peers and mentors to help you circulate them in local markets as well. However, a word of caution, do not depend only on your existing network for responses to the surveys – you may not get the most authentic data.

3. Use focus groups for more data: Bring together a focus group that represents your target audience on an online group meeting and have detailed conversations with them; understand their needs, their preferences, reasons for their purchase decisions, and more. 

For all of the above primary market research options, you will first need to master the art and science of creating an effective questionnaire. Here are a few tips on how to write market survey questions and ensure you get the best set of answers from your audience.

  • Start with your objective:

What do you want to achieve with this exercise? Do you want an indication of how you should price your product? Frequency of use of a particular service? Do you want to know whether your innovative service solves an actual problem? How is your TG currently solving the same problem? Do you want to know more about the psychology behind a particular purchase behaviour? Family profile of a potential TG?

This list can go on. Create a focused and streamlined list of your objectives. This acts as the starting point for the right questions. 

  • Questions should be easy to understand and answer:

Ensure your questions are written in a simple and straightforward manner. They should not confuse the respondent, leading to incorrect data.

E.X.  How often do you scarcely purchase groceries online? 

Instead, ask, How often do you purchase groceries online in a week?

  •  Avoid leading/biased questions completely. 

E.X.  Many feel virtual education does not work. What do you feel?

Instead, ask, What do you think about virtual education?

  • Avoid double-barrelled questions 

E.X.  Are you satisfied with your current choice of form-building and form-sharing software? 

Instead, ask, Are you satisfied with your current choice of form builder? 

And separate the second opinion with a new question: 

Are you satisfied with your current choice of form-sharing software? 

  • Match your answer format to the question: Qualitative and quantitative answers demand questions and answer formats accordingly.

For example, if you want to understand the psyche behind a customer’s thought process that is a qualitative answer, formulate an open-ended question:

For Eg: What do you think about virtual education?

But it is always better to limit the number of open-ended questions as the answers can sometimes get away from you. Stick to 1 open-ended answer at the end that is imperative to your survey. 

To get a quantitative answer, you can convert the same question to one with a scale: 

For Eg: On a scale of 1-5 (5 being best), how much did your child enjoy virtual classes?

  • Keep it short: To ensure quality answers, it is advisable to keep surveys short. Once customers lose interest, there are higher chances of the data being inaccurate. You can always ask them for permission to come back with another short survey at another time. 

4. Hire a Market Research Agency: If you don’t believe you have the bandwidth or expertise to dive into market research remotely, the easiest alternative is to execute it through local market research agencies. They can do more than just circulate surveys; they can conduct intercept interviewing, mall surveys, mystery shopping, public opinion polling, customer profiling and awareness studies. 

Hiring a market research agency can start from a couple of thousand dollars and go up to $15–20K, influenced by methodology, sample size, incidence and survey length. This is an investment, not a cost, because these insights can differentiate between a successful and unsuccessful G2M strategy overseas.

Some trusted market research agencies in Canada are: 

How to conduct Secondary Research in Canada 

Canada boasts of an ‘Open Data’ policy. This means that the Canadian Federal Government and other levels of government in Canada provide free and transparent online access to data collected and created by governments. Below are links to a wealth of information compiled by the Government available to you for free:

Free Canadian Government Directory Links

Free Canadian Market Research

Export Development Canada (EDC)
InvestCanada
InvestOntario
BetaKit
Communitech
Canadian SME
Globe and Mail
Tech Crunch
Statcan

Statcan: Statistics Canada is the national statistical office. You can browse through key information on Canada’s economy, society and environment. 

Census of Population: Find detailed statistical portraits of each Province’s people by their demographic, social and economic characteristics.

SME: Find research and statistics on small and medium enterprises 

Doing business with the government: Selling to the federal government, buying from the government and selling to other governments

Business and Importers Directory: Search for competitors, registered businesses, importers

Import/Export Trade Data: Generate Reports by product or industry

Census of Agriculture: Find profiles of the physical, economic, social and environmental characteristics of Canada’s agriculture industry

Global Trade Tariff Information: Identify tariff information for your goods

Business Ownership Statistics: Business performance and ownership data with key indicators, filterable by keywords

Financial Data: Understand how competing firms operate and are performing

Free Industry-Specific data compiled by the Canadian Government

Construction: Construction data, analysis and references with key indicators, filterable by keywords

Agriculture:  Agriculture data, analysis and references for sub-sectors like crops, animals, food processing and horticulture

Consumer Products: Data and analysis across Apparel, Food and beverage processing, Furniture, Printing and related support activities, Recreational boats and Sporting and athletic goods

Energy: A compilation of energy data resources indicators and use statistics

Manufacturing: Business resources and statistics on the Aerospace and defence industry, Automotive industry, Biopharmaceuticals and pharmaceuticals, Chemical industry, Hydrogen and fuel cell industry, Medical device industry, Canadian plastics industry, Primary metals industry, Canadian rubber industry, Shipbuilding and industrial marine industry, Textiles industry, and Canadian space industry.

Services: Statistics and profiles on culture and leisure, logistics, retail trade, tourism, and transportation. 

Technology: Profiles on information and communications technologies, fuel cells, nanotechnology, ocean technology and more.

Free Trusted Canadian Publications and Blogs for Market Research

Export Development Canada (EDC): Trade knowledge across Aerospace, Agriculture, Automotive and Heavy Truck, Bio-Refinery Products, Cleantech, Clothing & Textiles, Construction & Infrastructure, Media and Entertainment, Medical Technology and Devices, Mining & Metals, Oil & Gas, Supply Chain & Logistics Services, Telecommunications and much more. 

Start-up networks: StartUp Can, The Startup Canada Podcast, BetaKit, Communitech 

Clean Tech: InvestCanada, InvestOntarioClean Technology, Canadian Green Tech ( no longer operational, but has excellent opinion and analysis pieces) 

Manufacturing: Canada Manufacturing 

Mobile/Tech: Mobile Syrup 

Healthcare: CanHealth

Business: Canadian SME, Globe and Mail  

Tech: Tech Crunch, CBC, Globe and Mail, GetConnectedMedia, BetaKit, Financial Post, Communitech, TechTalent, Michael Geist Tech Law Blog

Entrepreneurship: A Podcast For Women Entrepreneurs, Canadian Business, NextCanada, Canadian SME

Real Estate: Globe and Mail, Canadian Real Estate Magazine, Real Estate Magazine 

IT: IT World, ICTC

EdTech: Mind Share Learning 

Stocks, Personal Finance: The Motley Fool, Million Dollar Journey 

Aerospace and Aviation: Canadian Aviation News, AIAC  

While Free resources are an excellent place to begin your market research for a foreign market, relying solely on these can cause costly mistakes later down the road. The frequency of updates, the nuances of consumer behaviour, and sector-specific information weren’t created with you and your purpose in mind. 

A balance of primary and secondary market research in the target country is the best way to build informed strategies. Secondary research helps you understand the history and macro level trends for your business, and Primary research gives you specific, actionable next steps for you to absorb into your product and plan. 

TBDC specializes in helping foreign and local entrepreneurs reach their business goals in North America. Want guided support, mentorship, funding introductions and pitch coaching to grow your business? Connect with one of our advisors today to find out how we can help. 

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