A market analysis is a timely look at the market from both a descriptive point of view.
It helps you figure out the size and worth of the market, the types of customers who might buy from you and how often they buy, the position of your rivals, and the overall economic environment, such as entry barriers and industry rules.
Why you should conduct a market analysis
No matter if you are writing a one-page plan or a detailed business plan for a bank or other investor, you will need to do a good market analysis. But don’t just look at the market because you’re making a plan. Do it because it will help you come up with a better plan for how to grow your business.
Once you know a lot about your market, it will be easier for you to come up with products and services that your customers will love. Even though market research might seem like a big job, it can be broken down into four easy steps:
1.You will talk about the current state of your industry and where you think it is going.
2.Who are your actual clients or customers? You will say how many of them are there, what their needs are, and what kind of people they are.
3.Competition: Describe the positioning, skills, and weaknesses of your competitors.
4.Pricing and forecast: Your pricing will help you decide how to position your company in the market, and your forecast will show what share of the market you hope to get.
How to do a market analysis in 3 steps
This section talks about the three main steps of a market analysis. It explains the purpose of each step and gives you questions to help you with your research and thinking.
1 Research your industry.
This sep is meant to help you learn about your industry as a whole so that you know how to get into it, can spot trends, and can compete with other brands.Here are questions to get you started:
- What kinds of statistics about your industry can you get from places like the US Bureau of Labor Statistics, BMI Research, and professiona lgroups?
- How many companies do business in this field?
- How big is the market in terms of the number of people who might buy?
- How much money does the business make?
- What are the rules that companies and customers have to follow?
- What outside factors, like laws and rules, new technologies, world events, and economic and social change, affect how businesses in this industry work?
- Where do you see chances to make changes in the industry?
2 Investigate the competitive landscape.
- In the next step, you’ll move from learning about the industry as a whole to learning about the brands you’ll be up against as you try to attract customers in your target market. Here are questions to guide your process:
- What are the most well-known brands in your field? Who sets the trends and gets the customers’ attention?
- In what ways do these various brands differ in terms of pricing, quality, and other features?
- What tools, tools, and channels do these companies utilise to build a customer’s experience?
- Explain how these companies are using content to better inform and captivate their target demographics.
- What can you learn about these brands from what people say about them?
3 Identify market gaps.
If you know how your competitors’ brands do, you can find gaps in the market, make your products and services stand out, and be a leader in your industry.
What we call “market gaps” are the demands that aren’t being met by any present brands. In the field of online education, for instance, you could discover that students are eager to learn about material that is not already being taught.
Here are some questions that might be used to identify open niches in the market:
- What, if any, impact do you think external variables like societal change and new rules will have on product and service development, given what you learned throughout your study of the sector at large?
- To discover what people really want, you should simply ask them, “What do you need that you can’t obtain right now?”
- Explain in detail the ways in which your product or service excels where those of your rivals fall short.
- Based on your skills and experience, how may you improve existing goods and options?
Your market analysis checklist
You may use this checklist as a guide for your market study, in concert with the procedures outlined above.
1.Research your industry.
Learn the landscape of your industry as a whole so you can better manage it.
Discover who the industry leaders are and think about how your brand might stand out from the crowd.
3.Identify market gaps.
Study the market to identify needs that aren’t being filled.
Businesses may learn about consumer demand and product viability with the use of market research. Insights on a company’s product or service may be gained from both primary and secondary data gathered during market research. Market research is an essential aspect of every company’s research and development process, since it provides crucial data for making important business decisions.