Email newsletters
An email newsletter is one of the best ways of staying in touch with – and learning more about -- your customers. It can provide a vehicle for announcing special offers or discounts, conveying information about your company, introducing new products, and inviting customers to visit your Web site. An added bonus is that it also enables your customers to tell you what’s on their minds.

If you’re thinking about launching a newsletter, keep in mind throughout the design process that you need to give your customers something worthwhile if you expect to get information back. Successful email newsletters keep customers involved and informed.

One way of doing that is to provide special information. For example, you can offer tips and suggestions on how to use your products, news about your industry, early notification of special offers or campaigns, maybe even a regular letter from your chief executive. Another way is to open the lines of communications by inviting customers to email you their suggestions.

Keep in mind that email newsletters also provide a great opportunity for pass-it-on, or “viral,” marketing. You should make it easy for dedicated, loyal customers who subscribe to your newsletter to recommend your company’s products or services to their friends. There are now methods available that make it easy to save and organize Web information to be shared, and email forms can be used by your subscribers to “Tell a Friend” about your offerings.

One of the benefits of an email newsletter is the demographic information that subscribers provide when signing up. Discovering who your customers really are – age, gender and special interests, for example – can help you target your products and services to their needs.

At the same time, however, you must tread very carefully when it comes to the demographic questions you ask. This is a matter of respecting subscribers’ privacy as well as plain common sense. The more demographic questions you ask, the more opportunities someone has not to sign up for your newsletter. Market research experts recommend that you seek a minimum amount of information at signup, then solicit additional information once you have established a relationship with a subscriber.

Remember: privacy is the foundation on which you build any relationship with a customer or prospective customer. Be vigilant about sending email communications only to those people who “opt in” to receive them, and reassure them that you will never sell their addresses to a third party.

Finally, email newsletters are a great value. At a cost of only a few cents per message, email is a bargain compared to traditional direct mail, which can cost $1 or more per piece. In addition, response rates on email communication are strong. According to the U.S. Small Business Administration, email response rates range from 5 to 35 percent, depending on the industry and format. Response rates for traditional mail on average range from 1 to 3 percent.

With those kinds of numbers, it’s not surprising that more and more small businesses are going online to connect with their customers

Online focus groups
Is your market research budget on the slim side? One of the least expensive – but most effective -- market research techniques is a Web-based focus group. The idea here is to identify a target audience – typically a select group of your best customers – and query them about your plans for a new product or service. Many small businesses post information about a new offering on their Web site, then send email to the target group referring them to the site. Once on the site, users are asked a series of questions about the offering. Not only is this an effective way to solicit feedback, it can save money too. After all, early feedback from valued customers can have a significant impact on product development plans. In addition, you’re sure to receive some input on general trends and may even get some new customer-driven ideas.

If you want to add more structure, but don’t want to incur the expense that a full-blown, moderator-led focus group entails, you might want to consider one of the many market research providers that are now online. These providers generally offer a variety of research methods, such as Web-based surveys (in multiple languages), email surveys, Internet panel research, and online focus groups. Use your favorite search engine to find an online market research service that offers what you need.

One last tip about focus groups: Market research professionals recommend getting in touch with the marketing department of your local college or university. See if there are marketing classes or individual students who might be interested in working on a market research project. Students often welcome such projects as a way of gaining real business experience. Best of all, their participation will cost you little or no money.

Where to find information
One of the best things about doing market research online is that ever more useful sources of information are available every day. Some of these you can access for little or no cost, such as the popular FreeEdgar service that offers SEC filings. Not surprisingly, however, the best sources of information about companies and markets generally require a subscription (usually an annual fee, although some information providers offer a pay-as-you-go plan).

If a subscription to one of these premier information providers is beyond your budget, you’re not entirely out of luck. The Small Business Adminstration suggests you contact your local university’s business library and ask about their policies regarding access to subscribed services. Some business libraries have a community membership arrangement that allows you a certain amount of use of these services for free.

Remember too that trade associations and government agencies are rich sources of information. The American Society of Association Executives’ Web site, for example, contains information on thousands of associations.

Regardless of the size of your business, market research is essential to staying in touch with your customers and identifying new opportunities. Tapping the power of the Web is a savvy way of doing both.