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