Conducting Market Analysis

Learn how to research and analyze your market to create a strong foundation for your business plan.

What is Market Analysis?

Market analysis is a comprehensive assessment of your target market, including: Key Components: • Industry overview and trends • Target market size and growth • Customer segmentation • Competitor analysis • Market opportunities • Potential threats Purpose: • Validate business concept • Identify target customers • Understand competition • Assess market potential • Guide business strategy

Conducting Market Research

Steps to conduct effective market research: 1. Primary Research • Customer surveys • Interviews • Focus groups • Field testing • Direct observation 2. Secondary Research • Industry reports • Market studies • Government data • Trade publications • Competitor websites • Economic indicators 3. Data Analysis • Market size calculations • Growth projections • Trend analysis • Competitive positioning • Price point analysis

Customer Surveys

Pros

• Direct customer feedback
• Quantifiable data
• Specific to your market

Cons

• Time-consuming
• Can be expensive
• May have low response rates

Interviews

Pros

• In-depth insights
• Personal connection
• Flexible questioning

Cons

• Limited sample size
• Time intensive
• Potential bias

Focus Groups

Pros

• Group dynamics
• Immediate feedback
• Observe interactions

Cons

• Group bias
• Higher cost
• Requires facilitation skills

Understanding Your Target Market

Define your target market with these criteria: Demographics: • Age and gender • Income level • Education • Location • Occupation Psychographics: • Lifestyle • Values • Interests • Behaviors • Purchase habits Business Customers: • Industry type • Company size • Decision makers • Budget range • Pain points

Competitor Analysis

Analyze your competition thoroughly: 1. Direct Competitors • Similar products/services • Target same market • Similar price points • Geographic overlap 2. Indirect Competitors • Alternative solutions • Different approaches • Substitute products • Emerging technologies 3. Analysis Criteria • Market share • Pricing strategy • Product features • Marketing approach • Strengths/weaknesses • Customer perception