A strong product research process ensures product teams maximize resources, meet key business goals, and make confident decisions that will deliver successful products and features to create customer delight.
Just as there’s no single way to develop a product, no single research process fits all product teams. But there are key steps that will help you balance business goals and user needs for actionable product research.
This article takes you through the factors you should consider to tailor product research to your desired outcomes and provides a step-by-by-step guide to doing research right.
Doing product research is a crucial first step for any ecommerce seller. Without understanding your market, competition, and potential customers, you risk wasting time and money on products that simply won’t sell.
In this complete guide, I’ll walk you through everything you need to know to conduct effective product research. By the end, you’ll have the skills to consistently identify winning product opportunities for your online business.
What is Product Research?
Product research is the process of analyzing data and trends to determine if a product will sell profitably. This involves researching factors like
-
Demand – How many people are searching for or buying the product already?
-
Competition – How many sellers are already offering the product and can you differentiate?
-
Trends – Is demand growing or declining over time? Is the product a fad or an evergreen need?
-
Affordability – Can you source and ship the product profitably within your budget?
-
Marketability – Can you effectively market the product to reach the target audience?
The goal is to make data-driven decisions instead of relying on assumptions or guesswork, Proper research helps minimize risks and points you to the most promising opportunities
6 Steps to Effective Product Research
Follow these key steps for a structured product research process
1. Brainstorm Product Ideas
Start by brainstorming a wide range of possible products you may want to sell. Some sources of inspiration include:
- Your interests and hobbies
- Popular items in ecommerce categories
- Trending topics on Google Trends or social media
- Bestseller lists on Amazon
- Wholesale trade shows
Avoidself-validation by only considering ideas you personally find interesting. Cast a wide net early to uncover opportunities you may have overlooked.
2. Define Your Criteria
Determine the criteria you will use to evaluate opportunities. Some factors to consider include:
-
Price range – What’s your minimum/maximum price point? How much budget do you have for inventory?
-
Size and weight – For beginners, smaller/lighter products are easier to store and ship.
-
Complexity – Simple products with few parts are easier to manufacture and have fewer issues.
-
Seasonality – Steady demand is ideal when starting out. Avoid risky seasonal products.
-
Your capabilities – Don’t overextend yourself early on. Play to your strengths and experience.
Define your “goldilocks zone” of ideal criteria before you dive into research. This will help you filter opportunities efficiently.
3. Evaluate Demand
Next, assess the market demand for each product idea:
-
Search volume – Use Google Trends and Keyword Planner to estimate search volume over time.
-
Amazon data – Check Best Seller Rank and total sales estimates for top products. Look for consistent demand.
-
Google searches – Review autocomplete suggestions and related keywords for additional demand signals.
-
Social buzz – Search relevant hashtags/keywords on social platforms like TikTok to find emerging trends.
-
Review activity – Scan competitor listings for consistent, recent reviews indicating steady sales.
Estimate the Total Addressable Market (TAM) to gauge overall demand. Is it large and growing enough to sustain your business?
4. Analyze the Competition
Research who your competitors would be:
-
Review top sellers on Amazon/major ecommerce sites selling your product.
-
Check seller ratings, reviews, number of products, and brand strength.
-
Search Google for additional competitors outside of Amazon/ecommerce.
-
Identify competitive advantages you can leverage, like better quality, branding, or price.
-
See if competitors have unmet customer needs you can fulfill.
The goal is determining if you can carve out a profitable niche against established players.
5. Validate Profitability
Confirm you can source and ship the product profitably:
-
Get quotes from suppliers on Alibaba or use a sourcing agent.
-
Calculate total landed costs including shipping, duties, and holding costs.
-
Factor in marketplace fees, payment processing, and advertising costs.
-
Price competitively based on competitor pricing/positioning.
-
Estimate profit margin after all costs to ensure it hits your targets.
If the numbers don’t work, move on. Don’t compromise on profitability.
6. Assess Marketability
Finally, evaluate how easily you can market the product:
-
How will you differentiate from competitors through branding, marketing, etc?
-
Does the product lend itself well to compelling listings, photos, ads?
-
Can you leverage social media or influencers to launch the product?
-
Are there opportunities for repeat purchases and loyal followers?
Your product, brand, and listings themselves are marketing assets. Choose products with inherent marketability.
Key Product Research Tools
Conducting thorough product research is much easier with the right tools:
-
Google Trends – Analyze search volume and seasonality for keywords. Free.
-
Jungle Scout – View category sales data, trends, and Amazon stats. Paid web app.
-
eRank – Track keyword rankings across search engines. Paid web app.
-
SEMrush – Research competitors keywords/traffic sources. Paid web app.
-
Google Keyword Planner – Get search volume and competition data for keywords. Free.
-
Google Alerts – Receive notifications when new content matches your keywords. Free.
Invest in paid tools like Jungle Scout for more robust data. The insights will pay for themselves in better product selection.
Turning Research into Profits
The most crucial step is actually acting on your research. With a data-driven approach, you can consistently identify winning products with the best chance of profitability.
Conduct research before you source any inventory – it will save you from costly mistakes! Follow the 6 steps outlined to validate your ideas empirically before moving forward.
With the right insights, you can spot opportunities months before the competition. Use that head start to establish market share before copycats catch on. Move quickly once data confirms you have a winner.
Product research alone is not a silver bullet, but it puts the odds for success firmly in your favor. By making data-backed decisions, conducting diligent research, and trusting your findings, you will avoid pitfalls and maximize your chance of launching a thriving ecommerce business.
Continue research after the product launch
- Consider doing a soft launch—or even canary deployment—where you release new products or features to a small group of users
- Gather data to weed out bugs
- Finally, adapt the product based on user responses
Then you can roll it out to all users.
But even once you’ve launched the final product, your research isn’t over. The best product teams stay connected with their users and regularly analyze market trends and tech changes.
After the product is released, either through a soft launch or a regular launch, implementing a data-driven approach to the go-to-market strategy is crucial in parsing consumer reports and validating trends and customer opinions.
Continuous research ensures that your product stays relevant and successfully meets customer needs, which will boost user metrics and business metrics alike.
So how can you continue your research throughout the product lifecycle?
- Watch session recordings to spot blockers and bugs where users are rage clicking or dropping off the product journey
- Use heatmaps to understand which product elements are most popular—and unpopular—with users
- Measure product analytics like click-through rate (CTR) and product conversion rate
- Stay up to date on industry and market trends
- Incorporate regular opportunities for cross-team discussions to get different research perspectives
- Schedule regular user and customer interviews
- Use product experience insights tools like Hotjar to give you a steady stream of user feedback through Surveys and Feedback widgets
Get to know industry trends
Next, combine your understanding of your users and market with research on technology trends that may affect user expectations of your product or its long-term viability.
Stay on top of trends by regularly engaging with tech cultures—read trade magazines and news sites, listen to tech news podcasts, and follow key trendspotters on social media and specialist forums. You can also use tools like Google Trends, Trend Hunter, and PSFK.
Another key source of tech trend information is your engineering team. Chances are, you have plenty of techies on your team who are up to speed on different aspects of technology and what’s forecasted to change.
Pro tip: rigorously analyze trends and put them into context to understand what has staying power, as you avoid jumping on every passing fad. Create a learning culture that embraces experimentation and gives team members the opportunity to share their knowledge.
Analyze the latest trending topics and projects in mainstream open-source communities across the Internet such as GitHub. These communities are an incredible resource for identifying tech trends that are sustainable, disruptive, and have immense staying power.
Its also important to subscribe to prominent tech publications and leading technology platforms such as Azure and AWS to get the latest tech news and new feature announcements delivered directly to your inbox. This way, your product team is always in the know about the most important tech trends that are shaping product development and product markets.
Once you’ve developed a strong sense of your users, market, and technology, it’s time to start testing concrete ideas and solutions.
Based on your early research, identify possible products, features, or upgrades that could meet user needs as well as business goals. Then, run concept testing to evaluate the user experience.
First, identify key users or user types to test. Recruit participants for customer interviews or focus groups, or deploy Hotjar Surveys, Incoming Feedback tools, and Session Recordings to test ideas with existing users.
Then, ask questions or set tasks and observe user responses. You may just want to explain concepts to users at this stage—or you can use wireframes or mockups; or, at later stages, prototypes or MVPs.
Make sure you account for confirmation bias and false-positive responses from users when designing the validation process. Include open- and closed-ended questions and use measures like purchase intent to determine customer adoption.
Pro tip: use fake door testing to gauge interest in new features across your existing user base.
In fake door tests, you show users a call-to-action for a product action that doesn’t exist yet. Once they click to perform the action, they’ll be taken to a page that explains this feature isn’t available yet—you may also choose to include a short survey on this page to learn more about their interest. By reviewing answers to survey questions and the click-through rate, product teams can quickly validate ideas for new features or improvements with users.
Dropshipping Product Research Step by Step Guide 2024
What is the best way to conduct product research?
There are a few different ways to do product research. You can use online tools like Google Trends and Amazon Best Sellers to get an idea of what people are searching for and what products are selling well. You can also reach out to your target market and ask them about their needs and wants.
What are the steps to product research?
There are a few different ways to do product research. You can use online tools like Google Trends and Amazon Best Sellers to get an idea of what people are searching for and what products are selling well. You can also reach out to your target market and ask them about their needs and wants.
What are some benefits of conducting product research?
Product research is essential because it can help you make informed decisions about your product or service. If you don’t research, you could launch a product that no one wants or isn’t profitable. Product research can also help you understand your target market and what they’re looking for in a product.
What are some common product research methods?
There are a few different types of product research, including primary research, secondary research, and desk research. Primary research is data that you collect through surveys or interviews, for example. Secondary research is data that someone else has already collected, like data from a market research report.
