Market study research techniques and information sources

Leo Exter, founder @ westartup

Why? Break-even analysis

Before you start

• 80/20 rule: 80% data is good enough for now

• Better approximately right than exactly wrong: beware of precise numbers

• Estimating market size is an iterative process: you’ll get there in the end

Key sources of data: big-name research firms

• Gartner http://www.gartner.com/ • Forrester http://www.forrester.com/ • IDC http://www.idc.com/

• Good Thing: LOTS of free stuff• Bad Thing: they collect other people’s guesses,

and add own guesses on top. • Look for facts, not Big Future predictions

Boutique research companies

• Soft drinks: http://www.canadean.com/• Mobile telephony: http://www.canalys.com/

• There’s got to be one for you!

A few aggregators

• http://www.firstresearch.com/• http://www.marketresearch.com/

• Lots of good stuff, but…

Watch out for discrepancies of

definitions.

Definitions are situational, just like ethics

• The Coca-Cola Company: NARTD beverages because it wants to look smaller (avoid competition trouble)

• Pepsi is Nr. 2 in “Cola” market

Government does a LOT of research

• National statistics organizations http://statbel.fgov.be/

• European Commissionhttp://ec.europa.eu/public_opinion/index_en.htm

Trade Federation

Trade federations

ESMA is a Leading, non-profit, Association in Europe for Specialist Printing Manufacturers of Screen, Digital and Flexo technology.

Value SourcePopulation 305 million US CensusWorking Population X 50.5% Dept. of LaborChanging Jobs Annually X 15% AssumedUsing Online Job Postings X 50% AssumedWilling to Pay $50 for Posting X 20% AssumedMarket Size in Revenue = $115.5 mln

So how do you use the data for your business model?

DOESN’T WORK THAT WAY!

We’ll be rich if we can get 1% of the market…

First, make sure you understand your consumers and market

Shortcut: look at the competition

• Revenue vs. employee numbers are fairly consistent within an industry

• Example: a consultancy earns 5-7 times what it pays an average employee.

Finding competitive data

• Annual reports of publicly listed companies

• Even better: ALL companies have to file their financial statements in Belgium

You’re just starting, so…

• Everything will cost more and take longer than for established companies – Everything you do for the 1st time will take longer– People will cost more than you think– Marketing will cost WAY more than you think

• Throw in a small correction for that: – Triple it.

BOTTOM-UP ESTIMATELast but not least:

What market can you realistically reach?

• Are there networks you can use to reach the entire niche? How many people in them?

• How many sales calls can YOU make per month?

• If you do get clients, how many can you actually service?

Thank you!

leo.exter@westartup.eu

www.westartup.eu

@leoexter