Market Analysis and Surveying
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Market Analysis and Surveying E.M. Erasmus, MA January 28, 2014
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Slides of my presentation during the event organized by foundation “Young Entrepreneurs Stichting, YES” at the Aruba Chamber of Commerce and Industry. January 28th, 2014.
Transcript of Market Analysis and Surveying
Market Analysis and Surveying
E.M. Erasmus, MA
January 28, 2014
Roadmap
• Why do Market Analysis?
• Market Analysis Grid
• Research Process
• Low-Budget/DIY Market Analysis
• Some Helpful Tips and Resources
• Final Thoughts
Why do Market Analysis?
• A key part of developing your business strategy
• Both first-time entrepreneurs and existing companies need market information for new products and services.
Why do Market Analysis?
Marketing Analysis can be used to: • Identify & Assess Opportunities
• Examine Market Segments
• Select Target Markets
• Plan & Implement Marketing Mixes
• Evaluate Marketing Performance
Market Analysis Grid
Customer Competition Context
Secondary
Primary
CUSTOMER ANALYSIS
After first identifying your market, you will then need to select a target market to be the focus of your company’s efforts.
Target Market and Customer
• Consumer market segmentation is
based on geographics, demographics,
psychographics, and buying
characteristics.
• A business can select and serve multiple
market segments.
Target Market and Customer
Market Segmentation
demographics
geographics
psychographics
buying characteristics
Target Market and Customer
Target Market and Customer
The target market for your product or service should be:
Measurable
Large enough to be profitable
Reachable
Responsive
1
2
3
4
Create
Evaluate
Forecast
Create a customer profile.
Evaluate customers’ needs.
Conduct research to forecast demand.
Researching the Target Customer
Creating a customer profile (personas) is the first step in targeting your marketing efforts.
• Age, gender, lifestyle
• Purchasing power
• Purchasing process
• Frequency of purchase, etc.
Creating a Customer Profile
In order to provide what the customer wants, you should prepare a customer needs analysis: that is a list of features and benefits of your good or service that the customers value
Evaluating Customers’ Needs
Several methods can be used to forecast demand:
Use historical analogy.
Interview prospective customers and
intermediaries.
Go into limited supply.
Forecasting Demand
• Usually, competing products and services are already established in the market.
• To succeed, you must be able to capture market share by differentiating your business.
The Competition
Many entrepreneurial companies succeed by studying the competition to define a niche in the market.
The Competition
The Competition
Create a profile of direct and indirect competitors in the market:
• Who are they?
• What makes them successful?
• What are their weaknesses?
• How will they react to new market entrants?
BUSINESS CONTEXT (ENVIRONMENT)
Look
Understand
Study
Look at trends and patterns of change.
Understand industry forces that affect your business.
Study industry demographics.
Analyzing the business environment
Local Trends
Renewable Energy
Ageing Population
Tourism Demographics Social Media
Mobile
Gateway/Export
Generation Y
Recycling/Upcycling
Consumer Awareness
Creative Industries
Sustainable Food
Health Consciousness
Global Trends
Global Trends
barriers to entry
threats from substitute products
sources of supply
buyers’ ability to bargain
technology
Industry Forces
carrying capacity
the ability of industry to support
new growth
uncertainty
the degree of stability or instability
in a given industry
complexity
the number and diversity of
contacts with which a business
must deal
1
2
3
4
Birth
Growth
Maturity
Decline
industry life cycle
the current stage of an industry
Industry Demographics
Identify your information needs.
Start the Research Process
The Five Steps of an Effective Research Plan
1
2
3
4
5
Obtain secondary resources.
Collect primary data.
Organize the data.
Analyze the data.
Research secondary data before researching primary sources because it is easily obtained and inexpensive.
Start the Research Process
The most common methods of gathering primary data are:
• observation
• interviews
• surveys
Start the Research Process
LOW-BUDGET/DIY MARKET ANALYSIS
Low-Budget Market Analysis & Surveying
• Use social media
• Talk to potential customers
• Visit your (potential) competitor
• Attend lectures and workshops (UA, KvK, etc.)
• Make use of UA students to conduct research
• Research and project reports database UA
Rule of Thumb
• The larger your investment, the more extensive your market analysis should be.
RESOURCES AND TIPS
Online Resources
Online Resources
Online Resources
Online resources
• http://www.marketresearchworld.net/
• http://www.bizstats.com/
• http://www.markettools.com/KnowledgeCenter
• http://www.sba.gov
• http://freeonlinesurveys.com/
• http://www.surveymonkey.com/
Online resources
Books on marketing research
Books on marketing research
• Methodology: should be good enough, not (scientifically) perfect;
• Make marketing research a habit;
• Don’t just rely on family and friends;
• Don’t just collect data…do something with it!;
• Know your industry…inside and out…;
Sharing some wisdom
Always Remember
• Market Analysis & Surveying is a tool.
• It assists entrepreneurs in their decision making.
• IT IS NOT A REPLACEMENT FOR ENTREPRENEURIAL JUDGEMENT!!
Final thoughts…
“He who asks is a fool for five minutes.
He who does not ask is a fool forever.” ~ Chinese proverb
