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Alison Evanow, Square One Organic Spirits, owns a spirits business in California dedicated exclusively to the development and marketing of organic spirits. Alison says, "We want to have fun socially while being environmentally socially conscious."

In this article Alison shares her experience with using market research to test out her products prior to launching her business.

Alison is a Make Mine a Million $ Business Awardee.

Q: You had an unusual concept, so obviously you wanted to test it out. How did you conduct your research?

I suppose you can divide our market research into three separate types of activities: quantitative, qualitative, and primary.

The first thing we did was conduct a quantitative online study of around 500 core vodka users across the country. (This was a statistically significant study.) First, we made a profile and then hired a professional research company which did the online study. We wanted to find out whether there was a level of interest in organic products among vodka users, and to see what that overlap looked like. With this study, we were able to quantify our market size, and that helped us determine our projected volume of production and other corresponding business decisions.

We are still using those results four years later in our business planning. First of all, it gave us such confidence in what we were doing, because we were able to confirm that yes, indeed, there was interest in the concept.

And it also validated us to others. It helped us not only gear up production targets when we talked to vendors, but it also helped convince our distributors. We are required by law to have a distributor in every state. It can be tough to convince each one to pick up new brands. You have to be able to prove yourself. There was lots of skepticism at first. They weren’t convinced that vodka users might also be environmentally conscientious. But this study helped us make our business case.

Q: So once you had the study completed, then what did you do?

The second piece of our market research was to explore our brand name, Square One. For that, we set up qualitative focus groups with bartenders and consumers in the San Francisco area. We showed them our packaging, our concept, our brand logo – we laid everything out in front of them and asked lots of questions.

And this experience was invaluable. We confirmed some things we already knew, but the research also showed us some surprises. First of all, we learned you can’t have a name using “square” and offer your product in a round bottle. So we had to go out and find someone who would make us a square bottle. It was expensive, but I’m so glad we did. We now have the proprietary design for our square bottle, and it’s become a part of our identity. I’m glad we spent the money.

Another thing we learned was how to position the name and how we talked about it. Some of the focus group members didn’t like the name, but when we explored that we learned that they didn’t really care about the concept of going back to nature or to a process used 400 years ago. What they cared about was Square One – as in they wanted to know that the process we use now is getting done correctly right from the beginning. That’s a subtle difference. But it’s had a huge impact on how we talk about our brand.

Q: You also mentioned primary research. What did that consist of?

In the beginning, because we didn’t have big distributors, we were able to hand sell the product here in California and through another person we identified in New York. We had to go from location to location ourselves, directly interacting with people, getting their feedback, watching them interact with our product. We asked lots of questions and we listened. We were trying to learn how to position the product and how to gear people toward this new brand.

Bartenders and mixologists became our sounding boards; we could use them to bounce around ideas. That enabled us to develop marketing messages that eventually got us into some high-profile restaurants. And once we were in several restaurant groups, that in turn helped us persuade our distributors in various states. By hand selling the product ourselves, we got quite an education.

Q: How do you define your target market?

It’s interesting about our target market. You know, we never refer to our demographic, although people will ask us. We just don’t talk in those terms. I mean, technically, we know that the core vodka user is between the ages of 21 and 55. But what does that tell us, really?

Instead of demographics, we are going after a certain “psychographic profile.” It’s more about attitudes and philosophies than traditional notions of age, gender, race or income level.

For example, we have been able to identify consumers across all age groups who are what are called “conscious consumers.” These are people who really think about every brand choice they make, and they make a conscious decision as to why they’re going to buy.

Such consumers are often looking at the company’s mission and goals and philosophy; they will choose to buy organic vs. non-organic because it’s better for the earth.

We’ve honed in on those people from a marketing point of view. And what we’ve learned is that those people tend to live online and in the blogosphere. So, we’ve been accessing those points and that’s teaching us how to talk to our consumers.

Q: What are your future plans for market research?

For now we don’t have any specific plans for more research other than informal sessions with key influencers (mixologists mostly) about new product ideas we have. One thing I have learned being an entrepreneur with a small company versus being in a big corporation, is that you have more permission to do things the way you want to do them using informal methods, not because you have formally researched the market for a specific gap in the marketplace. So for example, our next new product we will be rolling out next year was only tested with a few key mixologists, not consumers.

With a product like ours, consumers don’t actually know what they want sometimes until they see it, feel it, taste it, etc. Now that we have the credibility established with our base brand and our first line extension, we have “permission” to be creative and artisanal in our development. A big spirits company couldn’t do that because the risk of failure is too high, and too public. So for the immediate future, we will rely on our own experiences and observations of trends and a handful of key industry influencers to help us come up with our next products. It’s still market research, but of a slightly different kind.