Methods of market analysis
When creating a new product or maintaining its competitive level, one should take into account the state of the market space. In each specific case, it is advisable to pay attention to local characteristics, the level of competition, habits of the consumer audience.
Market analysis - is the collection of data and their interpretation in order to find out the place of the company or product on the market, to evaluate the prospects for development and to comprehend the requirements of the consumer, which subsequently influence the content of marketing programs. The analysis of the market is based on the identification of its size and segmentation (breakdown into quantitative categories with homogeneous characteristics), structure, existing trends, shares and relationships between structures within the market and beyond.
To understand the situation on the market and plan certain actions, any enterprise must have the necessary information. Systemic information acquisition and use of this for business development is possible provided marketing methods of analysis are implemented. Some of them should be specially mentioned, because they are quite widespread in the analysis of markets.
Situational analysis. The first stage in the development of marketing policy is the setting of goals. However, setting goals is possible only after an analysis of the situation. Situational analysis consists of the following components:
1. Market analysis:
• general market analysis (market growth, elasticity, main trends);
• market analysis of this group of goods or services (degree of saturation, how the market is divided, new developments);
• analysis of the market relative to a particular product (demand structure, degree of interchangeability, how strong the product position is in the market).
2. Analysis of market participants:
• producers (market position, production program, assortment);
• competitors (how strong is the competitor, how strong is the production program, and also the differences of the individual product of the competitor according to its real characteristics, for example, by means of distribution, by price, etc.);
• intermediaries (which functions perform, structure, coverage of the market);
• Supporting organizations (which functions perform);
• Consumers (needs, purchasing power, attitude to the product, that is, whether its real characteristics correspond to those in which the consumer feels the need, the goods through the eyes of the buyer).
3. Analysis of marketing tools:
• product (assortment, production program, supply flexibility);
• promotion (degree of popularity of the product, suitable advertising media, advertising strategy);
• price (price level, price dispersion, discount system);
• distribution (coverage density, distribution capabilities, distribution benefits).
4. Environmental Analysis:
• nature (climate, infrastructure);
• The economy (economic indicators, conjuncture, economic growth);
• society (social norms, life habits);
• technology (science, technological progress);
• law and policy (legal norms, political institutions).
Analysis of odds and risks. This is an analysis of the external environment of the enterprise. In its framework, the company is trying to determine which forces will be important for planning its own market activity strategy. As the external environment is constantly changing, the main task of analyzing risks and chances is to recognize strategically important changes. Under the latter are difficult to foreseeable events, the offensive of which can be either dangerous for the firm and even entail its bankruptcy, or, conversely, serve as a chance to increase turnover and profits, but to react in that case should be immediately. Chances and risks need not only to try to anticipate and adapt to them in the planning. It is advisable to try to prevent negative events or strengthen positive ones (for example, through lobbying).
As part of strategic planning, this analysis is carried out regularly. It is also recommended to develop certain scenarios of behavior in the event of an event.
Resource analysis. Represents an analysis of the enterprise's internal environment. It is recommended to carry out such an analysis in three stages.
1. Create a resource profile - describe and evaluate available financial (for example, revenue), organizational (for example, information systems), technological resources. You can also compare your resources and the resources of your nearest competitor.
2. Determination of strengths and weaknesses - the created resource profile is compared with the requirements of the market. Thus, the enterprise determines its strengths; considering them, you can develop a successful strategy. In addition, weak points are identified, which must be carefully worked out and, if possible, eliminated.
3. Identification of specific competencies - strengths and weaknesses of the enterprise are compared with the strengths and weaknesses of the main competitor.
Thus, those areas of activity are distinguished where this enterprise has undoubted competitive advantages.
Resource analysis helps not only to develop an effective competitive strategy in already existing markets, it also makes it possible to test how strong the sides can be used when entering new markets.
By applying the analysis of chances and risks together with the analysis of available resources, the enterprise can recognize those limited periods of time when the particular competitive advantages of this enterprise exactly coincide with the phase of development and specific market requirements. Such a favorable period must necessarily be used for a breakthrough in the market and long-term consolidation of its positions.
The instrumental basis for analysis can be:
• Statistical data;
• desk studies;
• Surveys of specialists;
• focus groups;
• Surveys of readers/viewers/listeners and advertisers.
As a result of the analysis, the company receives the necessary information about the market situation, competitive environment, consumer preferences, which will be used to create a product, plan and conduct marketing activities. Most often in this case, the SWOT analysis technique is used.
SWOT analysis. The abbreviation SWOT is composed of the first letters of four English words: strengths - strengths, weaknesses - weaknesses, opportunities - favorable opportunities, threats - threats or the possibility of unfavorable circumstances. A matrix map of similar analysis may look like this:
Four lists are compiled for analysis, one for each of these categories. Strengths need to be developed. Weak sides require work. Opportunities worth using. Threats should be eliminated.
Carrying out the SWOT -analysis is a good way to establish where the enterprise is and see where you can improve.
The media holding in Yekaterinburg, as part of the market analysis to positive factors, has included the planned construction of a new printing house, which will allow to more quickly cope with the replication of several holdings of the holding. To the positive factors, the abolition of tax benefits was also included. This circumstance alarmed the commercial director, who did not immediately understand the logic of the consulting team building the strategy of the media holding's activity on the market. The abolition of tax benefits was recognized as a positive phenomenon, since consultants, having imposed this fact on the market situation in this geographical area, came to the conclusion that this would clear the market of many small competitors and provide an opportunity for further development of the media holding. Time has shown that the consulting team was right ...
When using any methods of market analysis, it is always advisable to take into account the level of the competitive environment, its state and the quality position. If there is no competition in the market, then no marketing analysis, in fact, is required. The situation of a monopoly supply and a deficit in the market is called in the marketing by the seller's market. At the same time, the seller can have information about the market's capacity, the solvency of the population and, accordingly, the volume of probable consumption to offer their goods. It will disperse if nothing else is proposed or in the conditions of a non-market economy will be distributed.
The state of today's market can be determined by another marketing characteristic - buyer's market. When the buyer is offered a choice of similar products, then he has the opportunity to decide what to buy. The decision will undoubtedly be influenced by marketing tools: the quality of the product, its price, the convenience of purchasing, the degree of popularity and popularity. It is with these indicators in mind, when we are talking about a competitive environment, it is necessary to conduct its analysis. Which of the competitors is closer - first of all from the point of view of the target audience's attention to it? Who represents the product better or worse than ours? What are their differences? What do the competitors offer and how do they sell their products? Who are they, how many of them, what is their strength and weakness? What is the structure of the market and why do some competitors lead (due to what resources, actions, proposals)?
The following matrix, developed on the basis of the same SWOT analysis method ( Table 3.1 ), can be proposed for competitive environment analysis.
Notes (or how to deal with them)
As part of the analysis of the competitive environment, it is also necessary to take into account the opinions of consumers, their wishes for the quality of the product, its delivery, service, etc. In the end, choosing a particular product, the consumer is guided by his own benefit. That's why marketers offer for analysis the so-called utility model (Table 3.2).
Products or services provided
Consumer's point of view
Notes (or analysis of customer requirements)
Based on research data and understanding of market development trends, it is possible to develop a strategic plan aimed at improving the product, the activities of the company, the firm, the enterprise. Understanding the market situation in itself already provides information for further promotion of the company, suggests some of the likely ways to achieve the goals. At the same time, without knowledge of the market situation, the development or improvement of the product itself, the establishment of prices and its sale are impossible.
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