Affordable Market Research

Maxine McBride, President of Clockwork Marketing Services delivered her expertise on market research. How much money should a homebuilder allocate to market research? You need to assess it market by market, builder by builder. No easy answer here. Expect to pay $15,000 - $20,000. Focus Groups on your product are necessary. You need at least 3-4 focus groups with 12 participants each. One should be for Realtors.

The biggest part of the cost will be the recruiting, moderating, and organizing. You need a lot of people involved. The architect and lender needs to be involved. They can share the cost.

They do a bunch of direct mail to an appropriate set of zip codes. They tell people they are doing a focus group. They ask people to call them if they are interested. The per diem is $50 per participants. Once the potential participant calls, it is time to qualify the buyers.

It is also valuable to recruit from recent homebuyers.

Here are some standard focus group inclusions and rates:

Recruitment

Facilities

Research

The moderator (Get someone who understands the industry so they can answer basic questions)

Scripts that are written

Surveys before detailed discussion

Video tapes

Reports

In McBride’s case the rate they charge is $15,200.

They have found that they usually find at least one buyer in their focus group. So, it’s a nice offset to the cost.