A market analysis is conducted to determine the potential market for your business. It is very important
to conduct a market analysis for determining your target market and its various trends and behaviors. A market analysis also helps you in knowing how big or small your target market is likely to be.
So, if you are planning to start a business, or you are hired by a new start up for doing a market analysis, then here is a comprehensive guideline for you regarding how to go about it.
1. Find Out Your Target Market
To conduct a successful market analysis, it is really important to identify your target market. In fact this is the very first step without which you cannot conduct the analysis and run a successful business as well.
Remember, that having a set target market is extremely important. Not every person or group is going to buy your product or services. There is always a certain group which is interested in what you have to offer and that forms your target market. It also helps you in coping up with a lot of things in case you face a problem regarding your business in the future. It helps in making it easier to decide which products and service to introduce to your customers in the future and determining their turn out as well.
2. Utilize that Information
Once you are done with identifying the target market, which, by the way, is the most crucial step of an analysis you can now utilize this information. You can divide that information in to different sections as per your requirement. In case you are at a loss regarding making up the statistics, there are many online tools which can help you in developing the. Also, many government owned directories and websites have got free data of all sorts available which can be a great source of help for you and your market analysis. Maps, yellow pages and other directories are also helpful in getting as much information as you require.
3. Divide the Information
Once you have got all the information you require for your target market, you should now divide it into various sections depending upon the similarities and the differences present in the potential consumer. This division will help you out in determining the various requirements, needs, likes, dislikes and preferences of the target market. It will also help you immensely in coming up with an effective pricing strategy which is affordable for your customer and brings you a fair amount of profit as well. it will also help you in keeping yourself updated with the emerging trends among your potential customers and any changed preferences which they may opt for.
4. Quantify Your Market’s Growth
A best market analysis is the one which can make you identify the growth prospects of the market. Thus, when you conduct a market analysis, make sure that it is a measurable one so that you can quantify it according to your requirements. Once you have measured your market, you can know more clearly about the growth prospects. So, if you are targeting small businesses, you can clearly know how many of them your potential customers are in the future.
A quantifiable approach also helps a lot in determining the future aspects of your business. So, if your business still has to cover some or more of the potential market, you are exactly aware of what the further prospects of growing your business are. The good thing is that it makes it easier to predict the market’s future and the trend which it is most likely to follow. So if you want to know what the market trend is going to be in the net few or even 10 years, you can clearly identify it easily.
5. Leave All the Doors Open
Even if you are targeting the local customers only, keep the doors of more and yet more expansion open. Even small businesses are now effectively expanding not just in the local market but in the international market as well. thus, when you are conducting a market analysis, keep the option of entering into the international market open as well.