Anyone who intends to run pay per click (PPC) ads must have a solid grasp of the market to produce profitable advertising. While PPC advertising offers perhaps the fastest way to sell a product, it comes with a caveat: it's easy to lose money with a poorly-planned PPC advertising campaign. Make no mistake: how you do market research can make or break your business. To be successful, you must organize a system for entering any niche. What follows a step-by-step plan to prepare PPC advertisers to conduct market research.

Step One - Develop a Keyword List Put together a basic list of keywords that describe your business or the product you're offering. The human mind is the best keyword research tool you have at your disposal. Brainstorm keywords that best describe your business, and phrases customers may use when searching for more information about the products or services you offer. Once you've recorded every keyword you can think of, use automated keyword tools to further develop your list.

Step Two - Understand the Market Basics This is the exploratory phase of market research; it will help you understand the broader market landscape, and get a feel for the primary players. You will be using the keyword and phrase list you grew in step one.

* PPC ads

* Search for your keywords in your favorite search engine. The PPC ads on the side of the search engine results page (SERP) are your primary competition. The more ads there are, the stronger the market. In the next step you'll be using a competitive analysis tool to better understand what other advertisers are doing. Search engine results

* As a PPC advertiser, your primary competition is other paid advertisers. Nevertheless, take note of sites listed on the first page of the SERPs. Those sites aren't there by accident. They rank highly for a given keyword likely as a result of a focused marketing effort. Study those sites to further develop your own keyword list. Social media

Search sites like Digg, LinkedIn and StumbleUpon using your keywords to find out who in the market is generating word-of-mouth buzz. This is a quick way to discover the conversations taking place in your niche. Again, here you may find previously undiscovered keywords. Pay special attention to any blogs or forums you find that are dedicated to discussing issues relevant to your niche. You may be able to leverage these resources in your favor.

Step Three - Gather Competitive Intelligence When paying for advertising, it is imperative to know exactly what does and does not produce results for your competition. Why? If you don't understand what your competition is doing, your own advertising efforts will suffer. Competitive analysis tools give you a detailed breakdown of how your competition runs their ad campaigns - giving you a distinct advantage over them. PPC ads are a three-line summary of your business, and how people respond to your ads will have a measurable impact on your business's profitability. Getting sound competitive intelligence is especially important in this regard, as you will save a lot of money by learning the ad copy and keywords that are profitable for your competition. Sign up for one of the online competitive analysis tools, such as iSpionage, to get organized reports on the specific keywords, PPC ad copy, and landing pages that are successful for your competitors - and the ones that are unsuccessful, too.

Step Four - Meet Your Customers Prepare a reasonably small budget for an advertising campaign on a PPC network, such as Google AdWords. The goal of this test campaign is not to sell a product, but rather to get a better understanding of who your customers are, and their wants and needs. To do this, run PPC ads that direct visitors to a simple website with a survey about your product or service. Offer to email participants a free gift in exchange for completing this short survey. Ask participants questions about their basic demographics (age, gender, education), features they prefer in your product, and price points. By doing this, you can take a valuable peek at the mindset of your potential customers, while gaining data showing the relative demand for products in your niche. What can you do with the email addresses you collect? Aside from contacting participants once your product has launched, try requesting follow-up interviews. An in-depth interview will help you better understand the mindset of potential customers. Consider offering a free trial of your product in exchange for a detailed review, which can be used as a testimonial.