The Market Analysis

A market analysis will be made up of a range of factors relevant to the particular situation under review, but would normally include the following areas:

Actual and Potential Market Size

Estimating the total sales in the market allows the organisation to evaluate the realism of market share objectives. Identifying the key sub-markets of this market, and potential areas of growth, is crucial to developing a marketing strategy, as is establishing if any areas are in decline.

Trends

Analysing general trends in the market identifies the changes that have actually taken place. This can help to uncover the reasons for these changes and expose the critical drivers underlying a market.

Customers

The analysis needs to identify whom the customer is and what criteria they use to judge a product offering. Information on where, when, and how customers purchase the product, or service, allows an organisation to begin to understand the needs of the customer Identifying changing trends in consumer behaviour may begin to signal potential market developments and opportunities.

Customer Segments

Identifying current market segments and establishing the benefits each group requires allows an organisation to detect if it has the capability to serve particular consumer’s needs.

Distribution Channels

Identifying the changes of importance between channels of distribution, based on growth, cost or effectiveness, permits a company to evaluate its current arrangements. Establishing the key decision makers in a channel of distribution also helps to inform strategic decisions.