Module 12.4

Market Analysis

Jim Beach & Chris Hanks

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Industry Description & Outlook

• Description of primary industry

• Size of industry

• Industry characteristics

• Industry trends

• Life cycle

• Major customer groups

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Target Market Characteristics

• Critical needs

• Benefits (emotional vs. financial)

• Extent to which needs being met

• Demographics

• Geographic location

• Decision makers / influencers

• Seasonality / trends / anticipated changes Slide 12.4-3

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d. Size

• Number of prospective customers

• Annual purchases meeting needs

• Geographic area

• Anticipated market growth

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Market Penetration

• Market share

• Number of customers

• Geographic coverage

• Rationale

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Pricing

• Price levels

• Gross margin levels

• Discount structure (volume, prompt payment, etc.)

• Sensitivity / loyalty

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Identification

• Directories

• Trade associations

• Government documents

• NAICS / SIC

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Media

• Publications

• Radio / Television

• Direct Mail

• Internet

• Sources of influence / advice

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Purchasing Cycle

• Needs identification

• Research for solutions to needs

• Solutions evaluation process

• Final solution selection responsibility & authority (executives, purchasing agents, engineers, etc.)

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Secondary Target Markets

• Key attributes

• Needs

• Demographics

• Significant future trends

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Market Test Results

• Potential customers contacted

• Information / demonstrations given to potential customers

• Reaction of potential customers

• Importance of satisfaction of targeted needs

• Test groups’ willingness to purchase at various price levels

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Lead Times

• Initial orders

• Reorders

• Volume purchases

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Competition Identification

• Existing

• Market share

• Potential

• Window of opportunity (success breeds competition)

• New competitors

• Direct

• Indirect Slide 12.4-13

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Strengths

• Competitive advantages

• Ability to satisfy customer needs

• Market penetration

• Track record and reputation

• Staying power (resources)

• Key personnel

• Importance of target market

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Weaknesses

• Competitive disadvantages

• Ability to satisfy customer needs

• Market penetration

• Track record and reputation

• Staying power (resources)

• Key personnel

• Importance of target market

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Competitive Matrix Chart

Product or Service

Production/ Quality

UniqueFeatures

DistributionSystem

Marketing /Advertising

GeographicLocation

Strengths &Weaknesse

MarketShare

Competitor A

Competitor B

Competitor C

Competitor D

Competitor E

Competitor F

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Barriers to entry • Cost (investment)

• Time

• Technology

• Key personnel

• Customer inertia (brand loyalty, existing relationships, etc.)

• Existing patents and trademarks

• Creation strategies

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Regulatory Restrictions

• Customer requirements

• Government requirements

• Regulatory requirements

• Anticipated changes

• Methods for meeting requirements

• Timing involved

• Cost

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Seven Sentence Exercise

1) Purpose of the marketing strategy

2) How will you achieve this purpose, focusing on your benefits

3) Target market (or markets)

4) Marketing weapons you will employ

5) Niche

6) Identity

7) Budget (usually % gross revenues) Slide 12.4-19

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The purpose of Prosper Press is to sell the maximum number of books at the lowest possible selling cost per book. This will be accomplished by positioning the books as being so valuable to free-lancers that they are guaranteed to be worth more to the reader than their selling price. The target market will be people who can or do engage in free-lance earning activities. Marketing tools to be utilized will be a combination of classified advertising in magazines and newspapers, direct mail, sales at seminars, publicity in newspapers and on radio and television, direct sales calls to bookstores, and mail-order display ads in magazines. The niche to be occupied is one that stands valuable information that helps free-lancers succeed, the ultimate authority for free-lancers. Our identity will be one of expertise, readability, and quick response to customer requests. Thirty percent of sales will be allocated to marketing.

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THANKS!

Next: Lesson 12-5 The Company Overview

Buy or Review!

Slide 12.4-21