January 21, 2014

Spy on The Competition Like Never Before

Filed under: Market Research — Tags: , — Meredith @ 5:39 pm

detective

Want to know what’s selling and who’s selling the most? While this information was always available on Etsy, the wizards over at Etsyology have made it easier than ever! This stats oriented website tells you what’s selling on Etsy and who is having the most success selling there.

Here are some of the fascinating nuggets of info you can glean from perusing Etsyology:

1. Macro Data

This site tells you how many active listings appear on Etsy, how many items were sold last month, what the average sale price was and what the average conversion rate on Etsy was. This info can help you see how much competition you have, how your prices stack up and how your conversion rate compares to Etsy at large.

2. Shops Like Yours/Shops You Want to Emulate
With Etsyology’s shop search tool you can find shops like your own or search for shops with stats you hope to have some day. You can search by monthly sales and listing category (in addition to other criteria) to find shops you want to study. Maybe you want to check out how the competition has photographed their items or tagged their listings, now you can do it!

3. Data by Sales Category
This section is probably my favorite! You can hone in on specific product categories and see which categories have the best and worst conversion rates, what the average sale price is for each category, which shops have the most sales in each category and so much more!

Here are a few of the most fascinating facts I found on Etsyology:

  • Jewelry was by far the most competitive category (over 4 million listings) and this category also had one of the lowest conversion rates (just over 15%). The only categories with a worse conversion rate were quilts, furniture, crochet and art.
  • The best converting category was patterns at a whopping 92.7%! Books/Zines, Clothing, Geekery, Needlecraft, Plants/Edibles, Music, and Bath/Beaty were also high converting categories — all scoring over 30%. These stats are actually pretty consistent with my findings on department stores.  (By the way t-shirts had a conversion rate around 46%, if you’d like to get in on that sweet conversion rate with no up front costs, stop by DropShipDTG for a little help with that.)
  • Although jewelry had a high rate of competition and a low conversion rate, jewelry still sells — over 695,000 pieces sold last month! The low conversion rate is attributable to the massive competition. The other categories where a ton of product sold are Accessories (over 451,000 items), Clothing (over 303,000 items), Children’s Goods (over 266,00 items) and Paper Goods (over 246,000 items). It’s worth nothing that over 27% of the childrens goods sold were clothing.

P.S. One of my fave biz advice experts, Andreea Ayers, is sharing some amazing tips on product marketing. Check out what she has to say! You’ll be glad you did.


This content is copyrighted. See my content sharing policy here.

November 18, 2013

You Shouldn’t Invest In Inventory Until You Have Sales

Filed under: Market Research — Meredith @ 10:43 am

Image by OneLenz

“You shouldn’t invest in inventory until you have sales!” said Lori Greiner on a recent episode of Shark Tank. Greiner is a millionaire entrepreneur and panelist on TV series Shark Tank. If you don’t already watch Shark Tank, you absolutely should! The series is about entrepreneurs pitching their businesses to a panel of wealthy entrepreneurs-turned-investors. If the entrepreneur is successful the investors will invest in their business in exchange for an equity share. Every episode is full of interesting commentary about entrepreneurship, but this comment from Laurie is a particularly good one.

The Shark Tank investors were talking to an entrepreneur who’d sunk $200,000.00 into inventory and his business was operating at a loss. He did not end up getting an investment offer. All the investors thought he’d sunk too much cash into inventory.

But Greiner’s comment is a tricky one — how do you make sales with no inventory? Obviously it would be nice to have a proof-of-concept before you invest in inventory, but it begs the question, “can you sell something you don’t actually have to sell?” Yes! And here are a few ways you can do it:

1. Pre-Sales
If you have a product you can only sell after it’s been mass produced, hold a pre-sale to secure funds for production and to demonstrate that people do want to buy your product.

If you’re running a pre-sale, you might want to offer your early adopter customers a discount. They are buying the goods long before they will be delivered and helping you get your first batch of inventory made. You can use your discount offer as a selling point to drive sales and reward customers who helped you get things going.

If you can’t generate enough sales from a pre-sale to fund your manufacturing, that’s a pretty good indicator that demand for your product might be less than you expected. Better to know this before you spend your capital on inventory rather than after.

2. Made to Order Products
Made to Order products are a great way to start selling goods before you produce them in bulk. You can make the products yourself or have them made as orders come in. This is a great way to see what people will buy before you stock up on finished goods. If you aren’t going to be making your own products to order, look into suppliers that provide this service such as DropShipDTG or Art of Where.

3. Small Batch 
While it might be cheaper per piece to make 10,000 of something, hold off on that kind of inventory level until you know you can sell the goods. Consider producing your finished product in smaller batches, even if the unit cost is a lot higher, just to test out sales before you mass-produce.

A friend of mine who designs and manufactures sleepwear actually market tests styles of sleepwear from other companies before she manufactures. She goes to retail stores and buys different styles of pajamas to sell online. She makes notes on what sold — details like colors, sleeve length, fabric type, etc. and designs her own sleepwear based on that sales data. Although she doesn’t actually make money selling a few dozens sets of pajamas she bought at Target, she is able to gather enough sales data to know what she should be producing for her own product line.

 


This content is copyrighted. See my content sharing policy here.

July 20, 2010

Finding the Niche That’s Just Right

Filed under: Market Research — Tags: , — Meredith @ 7:32 am


Goldilocks print by AntheaArt

The issue of target market comes up a lot and it definitely was touched on during the discussion of designing products for fun vs money.

One comment I saw in response to my article on products for fun vs money was that you can do any products for fun, you just have to find the niche that likes what you’re doing. To that I say “sort of.” The trick with having a successful line is having a target market that’s specific enough that you’re not competing with the whole world, but large enough that you’ve got a big enough pool of potential customers to make a living.

What this means is that there might be only a few dozen people that would be willing to pay $1,000 for a painting of Babe Ruth that you made from your own blood. That’s not very many people. You might love making Babe Ruth paintings with your own blood, but it’s not going to make you rich. It’s too narrow of a niche and you’re not going to sell much. Conversely, you may love making beaded bracelets, but a string of beads is a fairly generic product that has a very broad audience and tons of competitors. Having a product that is so broad and common may make it tough for you to succeed. You’d probably need to narrow things down a bit by maybe having sports team colored bracelets, or maybe your beads are special because they’re made from eco-friendly materials.

So what makes a product just right? How do you know if you’ve found something niche enough to eliminate a lot of the competition but not so niche that there’s no customer base? Here are a few things to consider, Goldilocks.

1. How big is the market for it?
How many people, realistically, would buy what you’re selling. Are there hundreds? Thousands? Millions? Are there magazines dedicated to the kind of people who might buy your product and if so what’s the circulation like? Are there websites dedicated to the kind of people who’d buy your items? How much traffic do they get?

Imagine you want to sell organic crib linens. Your market is eco-conscious parents. That’s a fairly specific niche. Not all people have babies. Not everyone with a baby cares about having organic linens. On the other hand, you can see that there are quite a few publications and websites geared to eco-friendly parenting. It’s definitely a sizable enough market to move some product. If you google “eco-friendly parenting” you’ll probably find quite a few places to advertise. So far so good.

What’s the competition like?
Having too many competitors can be a problem. If you haven’t found a specific enough niche then you’re competing with everyone and chances are someone can do your generic item cheaper, faster or better.

To go back to my example, crib linens is a huge market, a search for crib bedding on Amazon gets me over 20,000 matches. Yikes! Organic crib bedding narrows the field to just 620 matches. It’s a more manageable amount of competition, but it doesn’t necessarily mean you’re positioned to make your millions.

What’s your USP?
To truly make your brand a success, you’re going to need a unique selling proposition that appeals to your target market. Are your products the cheapest? Maybe you can sell the most affordable organic crib bedding. Are your linens the softest and most luxurious? Do you have the largest selection of colors?

Chances are someone else is selling something fairly similar to your own products, so you need a way to distinguish yourself among your target audience. Take a hard look at your product offerings and try to determine what features or benefits you can offer that no one else has.

If your sales aren’t where you think they should be, go over the points above. Research the size of your potential market, research the competition and take honest stock of whether you have something to offer that’s unique from the competitors. If you’re failing on any one of these points it might be time to reconsider what you’re selling.


This content is copyrighted. See my content sharing policy here.

June 30, 2010

People Watching as a Form of Market Research

Filed under: Market Research — Tags: — Meredith @ 5:34 am

Back in April, I wrote an article about how to find your target market, but I still see so many people asking about how to do it. So if you didn’t read the April post, check it out. Today’s post is more of an addendum to that one. Today I’m talking about people watching as a form of market research.

First and foremost, to make people watching into an effective form of market research, you have to have great observation skills and an eye for detail. You can pick up lots of useful information by watching people but you have to know what to look for and where to look.

1.Get out of your comfort zone
A lot of us are used to doing the same things, going to the same bars, hanging with the same friends. This type of rut can spell trouble for your entrepreneurial creativity and it’s especially problematic if your scene isn’t your target market. So what to do? Get out of your zone. Go to a different type of bar. If you normally go to indie rock bars, hit up a dance club. If you normally hang out in an upscale, posh cafe on the upper west side, go get a cup of joe in Williamsburg, Brooklyn. Go to a bowling alley, go to an art opening. Just get out there and do something different. (Try to pick places that you have a hunch might have your target market hanging out in them.)

Why would you do this? Two reasons:
- Because your customers might be lurking in places you don’t normally go and you might never know it until you get out there.
- You might discover a new and under-served target demographic that you want to reach.

To understand prospective customers, you have to get a little entrenched in their day-to-day lifestyle. It’s also important to take note of the people you see when you go out. Do they wear jewelry? If so, is it expensive precious metals or inexpensive quirky stuff? Do they carry handbags and if so are they small or big? What kind of clothing do they wear? What colors do they wear? Try to imagine where these people shop. Would they walk into your virtual store? Does what you sell look like what they own? Do your models on your website look like these people?

Another thing to notice is pricing in public places. Are the people around you sipping $12 martinis or $4 Buds? This may be an indicator of your target market’s disposable income. You can make inferences about that along with observing their clothing and accessories.

2. Go to market
I said in a recent post that it can be tough to make a craft show profitable. That said, they can be great places to do market research. Pay attention to who comes to your booth and how they react to your products.

Are your booth visitors young or old? Male or female? Do they have kids? How are they dressed? Which people buy and which people window shop but walk away? Are you losing customers with smaller budgets due to your price points? Can you make a cheaper version of what you sell to capture that audience? Would you even want to?

You might also want to take time to notice the people who are visiting your competitors’ booths. What characteristics distinguish those people from everyone else at the show?

Taking notes on the defining characteristics of shoppers at a show can help you build a composite profile of your target customers.

3. Hone in on pop culture
Pop culture is a great way to observe consumer markets. Rock stars, celebs and TV and film characters are often reflections of people in society. Pay attention to what characters on TV wear. Those characters are often representative of real people. Follow some celebrity gossip blogs to see how Miley Cyrus is accessorizing, because chances are her fans want to wear the same kinds of pieces.

Try to find film and TV characters that wear or use products that look like what you sell. Then take note of where the characters spend their time and what their interests are. All of these observations will help you envision your own customer archetypes and better serve their interests and wants.


This content is copyrighted. See my content sharing policy here.

May 4, 2010

Niche Inspiration

Filed under: Growing Your Business,Market Research — Tags: , — Meredith @ 2:30 pm

Sometimes as small business owners we create product and then try to find a niche for our product. Other times we’re stumped for inspiration so we seek out a niche to create product for. There are thousands of niches. Need inspiration? Here are just a few:


This content is copyrighted. See my content sharing policy here.

April 5, 2010

Putting the Cart After the Horse: Finding Your Target Market

Filed under: Market Research — Tags: , — Meredith @ 6:33 am

I recently wrote a post about how it’s important to direct your marketing efforts towards your target customer demographic. Some readers said they weren’t sure who their target market was, so today’s post provides tips on how to figure that out.

1. Google it

Don’t have any clue who your target market is or what they’re interested in? It’s time to start Googling. Start by searching for what you sell. Let’s say it’s stained glass wind chimes for example. Pay attention to who else sells wind chimes and what kinds of other items they sell. Maybe you’ll notice new agey sites sell them or gardening sites. Also pay attention to what types of blogs are writing stories about wind chimes. Are they home decor blogs? Are sound engineer blogs discussing them? All of these pieces help you identify target markets. By the time you’re done you might break your target market up into:
- New Agers
- Gardeners
- Interior Decorators/Designers
- New Home Owners
- Musicians

Now you have a little more direction on where to advertise, what to blog about (gardening, interior decorating, etc.), and what types of media to send pitches to.

2. Read all about it
Start reading publications that talk about the types of items you sell. If you sell corsets, start reading blogs and magazines about steampunk, goth, bondage, etc. If you sell mosaic wall hangings start reading Dwell or Better Homes and Gardens. You want to consume the same materials your target market’s consuming so you understand them better and understand their interests. If you don’t know what your customers read, go back to step 1 or try out steps 3 and 4.

3. Ask your customers
If you want to know more about your customers, you should ask them. Sites like polldaddy.com make is easy and free to create surveys, so go make one. Ask past customers where they like to buy their clothing, what magazines they read, what web sites they visit, where they live, how much their household income is, what gender they are, how old are they. Ask questions that will get you a clearer understanding of who exactly is buying your products and what they’re interested in.

4. Spy on the competition
Your competitors’ websites provide a wealth of market research. Visit the sites of competitors that are successful and see what they’re blogging about. See where they’ve gotten press. Follow them on Twitter and see what they tweet about. All of these pieces should help you put together a clearer picture of who buys what you sell and how to get their attention.

Still stuck? Visit my consulting services page. I can help you come up with a personalized plan to research your market or do market research for you.

Related Posts Plugin for WordPress, Blogger...

This content is copyrighted. See my content sharing policy here.