of the project as a whole. Such market analysis will help to see the capacity of a niche, find out the level of demand, identify competitors, assess growth opportunities and prevent economic threats. In addition, the promotion strategy should take into account geographic factors, economic situation, cultural characteristics of consumers, political stability or instability.
For business development, it is important not only to develop online business promotion, but also to minimize risks. This is especially important when you are planning to attract investments in your project.
Obtaining basic information for analysis
The key characteristic for entering the market is its capacity. What does this term mean? It is the ability of consumers to buy a certain amount of your goods or services in a given period of time. To do this, you need to get two initial indicators – the number of CAs and the standard of consumption of this type of product for the selected period. Thus, market size is the product of the number of consumers by the consumption rate. Such an indicator will allow to clarify the maximum possible demand in order to avoid overstocking and returns.
What is consumer market analysis for?
Development of a promotion strategy is based on knowledge of the target audience, decision-making algorithms, and other factors. Psychological, demographic, social and geographic assessments are needed to understand the big picture. After the stage of collecting information and analyzing it, you can proceed to segmentation of the target audience. For this, the market is divided into separate groups, which are united by similar characteristics. This includes: purchasing power, income and demand levels, decision-making algorithm, and so on.
What data will you get after analyzing the market
After conducting market analysis, you will receive the following indicators:
- Information about the state of the industry in your region / country,
- Consumer data and a portrait of the target audience,
- Understanding the strengths and weaknesses of existing competitors,
- Prospects for the development of your project, taking into account the market capacity,
- Identification of economic hazards and risks.
How market analysis is carried out
There are several methods to obtain information. The choice of methods of marketing research and analysis should be based on the purpose of its conduct. That is, the head of the company must understand why the information is collected and what kind of data is important to obtain. The main areas of market research are divided into general and marketing.
General market research allows you to study the demand for a product or service, analyze pricing issues, growth / decline trends in demand. This method allows you to identify the most attractive areas for investment, if there is such a task. When developing a promotion strategy, analysis of statistical data is the basis for developing a work algorithm.
Marketing research of the market situation is aimed at studying a specific area of business, in which the main emphasis is on the study of behavioral factors, the market situation and the positions of competitors. Such analysis allows you to develop short-term and long-term forecasts, build strategies and make informed decisions.
Industry study rules and analysis
Usually business is conducted in a specific region or several regions. It is more difficult to master large spaces immediately, as this route will require more marketing and advertising costs. Now in online trading, borders between cities and countries are blurred, but in any case, there are economic differences. It is necessary to identify:
- specifics of a specific market and clarify the starting positions of your business.
- what customer needs your product or service solves.
- volume of consumed goods / services.
- dynamics of growth or decline in demand due to seasonality and other factors.
- problematic situations in this industry and possible obstacles to the sale of goods.
It is necessary to study the features of doing business in specific conditions:
After studying the competition, it is helpful to brainstorm new solutions for the current market format. If you manage to create a WOW effect, customers will be more willing to purchase your products and services. Repetition of already known production and sales models rarely allows you to detach yourself from competitors and reach a new level. But the creative approach of the team, competent marketing, innovative solutions will help you become a leader.
When it comes to investment projects, it is important to collect indicators not only for the current year, but also to analyze the dynamics of changes over 4-5 years. Such charts clearly demonstrate the state of the industry and can be a decisive factor in making a positive decision for large investors.
What is important to know when studying competitors
Understanding the business environment and its specifics will enable you to assess your strengths in relation to the current market situation. We recommend that you pay attention to competitors not in general terms, but in differentiated ones, in order to study them by groups:
- direct – performing similar activities for the same CA and in the same region.
- indirect – having differences in target audience or other characteristics.
- potential – representatives of other regions, but with a chance to become direct competitors for you in the future.
What is included in the competitor analysis:
- Pricing – statistics, dynamics and company policy.
- The range of goods / services and its breadth.
- Product quality.
- Sales organization.
- Popularity among consumers.
- Raw material suppliers.
- Marketing strategy.
- Advertising channels.
- Management of organizations.
- Advantages of competing products or services.
- Weaknesses of the organization, production, operation of competitors’ goods.
The effectiveness of online marketing and advertising
You definitely need to pay attention to this aspect in order to get analytical information on ways to attract customers. Commonly used advertising channels:
- online website promotion – contextual advertising, targeted advertising, seo-promotion,
- smm activity – maintaining accounts in social networks, increasing brand awareness and popularity,
- stimulating purchases – promotions, coupons, contests, discount programs, other events,
- PR – active participation in public events, publications in the media (online and offline), reviews, interviews with experts,
- outdoor advertising, TV, magazines, newspapers.
Study where your competitors’ ads are placed, what the media say about them, the quality of social networks, loyalty programs, and other activities.
Advertising in the press, on radio and TV is effective for the B2C segment, but is of little use for the B2B business. CEOs and top managers of large companies do not scrutinize newspapers or advertisements on TV programs to find suppliers or business partners. But they will be interested in professional information on special resources: analytics, charts, facts, forecasts. However, such statistics will be boring for the mass consumer of clothing or footwear. That is, you need to distinguish between the sphere of interests of your target audience in order to find ways of effective interaction and organize a comprehensive online promotion.
How to study your consumers
When developing a strategy, it is important to understand not only the age, social status and income level of your target audience. You have to work with specific people and their needs, understanding the decision-making process and the significant characteristics of the goods.
Key areas for consumer analysis:
- defining purchase goals,
- clarification of needs and “pains”,
- motivation tools,
- comfortable price level,
- expectations for service and service standards,
- key queries – what he wants to get from the product,
- decision-making algorithm (logic, emotions, authoritative opinion),
- reasons for claims and displeasure.
How market analysis affects promotion
First of all, you can find out the current situation for your group of goods or services. Competitor research will provide insight into which customer needs have not yet been addressed or are not being sufficiently met. The dynamics of the market over several years will allow planning production volumes and the size of the expected profit.
Based on the research results, you can find out:
- a place in the market that you can really take,
- reasonable prices and profitability of your project,
- payback period of material investments,
- optimal advertising channels,
- the most effective marketing actions.
How best to organize market research
To do this, you can use different methods, which depend on the scale of your business, staff, budget and type of goods / services. In each specific case, you need to consider all factors in the complex, and not separately.
Market analysis options:
- on their own – this is suitable for small companies or entrepreneurs who do not have a sufficient budget. However, without experience and knowledge, you can get inaccurate information that will not lead to results.
- with the help of marketers – the marketing department is able to conduct market research in order to obtain fairly objective forecasts.
- with the involvement of a marketing agency – the most professional and reliable way that will save time, nerves and efforts. The work of professionals is not cheap, but it gives the most accurate and complete analysis results.
When choosing a contractor, consider not only the cost of research, but also take into account the cost of error. An inaccurate forecast can lead to large material losses and business collapse, so it is better to choose specialists with experience and knowledge.