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Entrepreneurship and Venture Creation

Use this guide to locate resources that support entrepreneurs

Market Validation

 

 

  • Top 5 Ethical Research Guidelines
  • Research Methods & Sample Size
  • Top 5 Survey Tips
  • Research Tools
  • Market Research How-To eBooks
  • Key Terms

Market validation,  the process of determining whether or not an opportunity exists in the market for your product of service, usually involves talking to potential customers. 

This is also called primary research and there are important considerations to ensure this research is conducted effectively and ethically.

Entrepreneurship research requires both primary and secondary research. Start with secondary research - see what information is already available - then, use primary research to fill in the gaps and answer the questions you still have.
 

Top 5 Ethical Research Guidelines

1. Think from the participant's perspective.

  • What information would you be willing to share, and under what circumstances?
  • What would make you feel comfortable answering the questions that the researcher is asking?
  • How would you feel if you work at Company X, and you learn that the information being gathered will benefit your competitor, Company Y?
     

2. Introduce yourself and the research.

  • Identify yourself honestly, and explain your objectives for conducting the research, including:
    • how the information collected will be used.
    • who will benefit from the information.
    • whether or not participants and their responses will remain anonymous. If not, why?
  • Do not misrepresent yourself as a customer or client, especially if seeking information from a competitor company.
     

3. Consider confidentiality and data security.

  • Collect Personally Identifiable Information (PII) only if it is absolutely necessary.
    • PII refers to “information which can be used to distinguish or trace an individual’s identity, such as their name, social security number, biometric records, etc. alone, or when combined with other personal or identifying information which is linked or linkable to a specific individual, such as date and place of birth, mother’s maiden name, etc." 
    • If PII must be collected at all, protect participants’ responses and personal information


4.  Be careful asking personal health questions!

  • Avoid asking directly about a person's physical or mental health status.
  • Avoid asking directly about a person's health condition(s), medication(s), etc.
  • Avoid combining health questions and questions that ask for personally identifiable information.
  • See also: The Health Insurance Portability and Accountability Act of 1996 (HIPAA)
    • HIPAA protects the confidentiality and security of personally-identifiable information that arises in the course of providing health care.
       

5. You might need Institutional Review Board (IRB) approval.

  • FGCU's Institutional Review Board IRB is responsible for reviewing human subject research and ensuring compliance with federal regulations, state laws, and FGCU policies, to protect the safety and welfare of human subjects.
  • If you are doing primary research for a class assignment or an entrepreneurial project, you probably don't need IRB approval. If you hope to publish or present your research, talk with your professor(s)/advisors.

Research Methods and Sample Size

For market validation research, three common research methods are surveys, interviews, and focus groups. Try The Market Research Toolbox: A Concise Guide for Beginners HF5415.2 .M383 2016.

Method Definition Pros Cons
Surveys Participants are asked to respond to a pre-defined series of questions. Can include both open- and closed-ended questions. Can yield a mix of quantitative and qualitative feedback, depending on how the survey is designed. Can be conducted in-person, by telephone or mail, or online.
  • Cost-effective way to reach greater number of participants.
  • Option for participant anonymity.
  • The rise of “survey fatigue” – the frequency with which individuals receive surveys may reduce response rates.
Interviews One-on-one conversation between the researcher and the participant. Usually involve open-ended questions. Yields mostly qualitative responses. Can be conducted in-person or virtually. Option for audio/video recording of responses.
  • Can explore topic more in-depth.
  • Flexibility - can adjust questions based on participant’s responses.
  • Can involve substantial time and/or money.
Focus Groups Discussion of a topic amongst a small group of participants. The researcher facilitates the groups’ discussion by asking questions and observing responses. Yields mostly qualitative responses. Can be conducted in-person or virtually. Option for audio/video recording of responses.
  • Receive feedback from multiple participants at one time (can be more efficient than one-on-one interviews).
  • Interactions among participants can provided additional insight for the researcher.
  • Potential for “group think” – the desire to conform to the opinions of the group may reduce the quality of participant responses.
  • One participant may dominate the session, preventing others from sharing their opinions.
  • Participants may be less forthcoming in a group setting.

What should my sample size be?

A sample is a portion of the larger population that you are researching. There is no one “standard” sample size that applies to all primary research projects. A sample size that is too large may present issues regarding time and money, while a sample size that is too small may invalidate your results. Consider the size of your market and use your best judgment when determining your sample size.

Top 5 Survey Tips

How do I get people to take my survey?

Consider these tips to avoid common pitfalls and design a survey that increases the response rate:

1. Limit the number of questions.

  • Ask only what is absolutely necessary – the shorter, the better!

2. Ensure that the survey can be completed in under 10 minutes (less is better!).

  • Inform participants upfront about the time involved and, if using an online survey, include a progress bar.

3. Consider the ratio of closed- to open-ended questions.

  • Closed-ended questions are quicker to answer and participants are more likely to skip open-ended questions if there are too many.

4. Consider mode of delivery.

  • Online surveys are easier to complete than paper-based surveys and more efficient for the researcher (most online survey tools offer report generation and analysis features).

5. Don't ask for personal information.

  • If necessary, allow participants to "opt-in" for a follow-up by providing the opportunity to share their contact information.

For more information:

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