You've got an idea for a new product, or a new tool for your web site, or a new twist to your customer service, but you're not sure how it will fly. How to avoid wasting money and resources?

One way is with a focus group.

What is a focus group?

Composed of about 10 people, focus groups gather in a room to discuss or react to a topic of your choosing. A moderator leads the discussion by following a script of questions and ideas, encouraging comments and keeping the discussion focused. The feedback from those individuals in the focus group is your data, and what you will use as a take-away to base future decisions on.

What do focus groups typically cost?

Holding a focus group properly comes at a hefty price, especially considering that experts recommend holding at least two sessions to arrive at any conclusive results.

But at $4000-$6000 a pop (price can vary greatly depending on location), a fully outsourced focus group probably won't fit into a small business' budget.

But that doesn't mean focus groups are restricted to companies that have their Christmas parties at the Ritz. Putting together a focus group takes several steps, and not every one of these steps needs to be outsourced to an outside provider. In fact, by doing some of the work on your own, you can cut the price in half.

Options for cutting your budget

Write the script yourself. Outsourcing the writing of the script will typically cost about $1000.

Moderate from within. You'll save another $1000 per session if you let someone from your office be the moderator, as long as the person is qualified to lead the discussion and can keep it focused.

The drawback is the moderator won't be able to observe, so make sure to videotape the session ($100-$150) so you can watch it later -- or have others from your business watch and take notes.

Hold it in-house. Although using a neutral outside facility is ideal (you'll have room for spectators, and likely one-way mirrors for people to observe without disrupting the session), if you have some sort conference room that would work, give it a shot.

Self-analysis. Even though it's recommended, with a price tag of $2000 or so, having professional analysts analyze your data probably isn't an option.

If you want to analyze results yourself, really watch the tape more than once, go over your notes and any notes from spectators, and most importantly, be careful not to hear what you "want" to hear.

Where NOT to cut corners: recruiting

Recruiting the right individuals for a focus group is extremely time-consuming and best done by experts at market research firms. Pricing is based on status of participants: $35-50 for consumers, $50-100 for professionals, and $100-150 for executives.

Pricing can vary greatly depending on your location, so make sure you do a little research into pricing.

Quick tips