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:

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

Table stakes — things ALL competitors do. You must match these or customers won't consider you.
Universal gaps — things ALL competitors do poorly or skip entirely. This is your opportunity.
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:

What is the trend? (be specific, not "AI is big")
Evidence: 2-3 concrete data points or examples.
Maturity: Emerging (< 20% adoption) / Growing (20-50%) / Maturing (50%+) / Declining.
Impact on your opportunity: Tailwind (helps you) / Headwind (hurts you) / Neutral.
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.

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