A market analysis is a thorough examination of your current and potential markets for your products and services. It is not difficult to learn how to do a market analysis. But it does take time and patience.
Current market. The first step in doing a market analysis is to study your current products and markets. You will need to get feedback from your customers through market research. Find out what they like about your products or services, and what they dislike. Ask them how they view your pricing structure, and find out what the market will bear for your products. This is called price elasticity. You may be able to charge more for your product and still increase sales. You also must determine if there are any other products or services your customers may like to have. Also, determine their likelihood of purchasing your products again.
Potential. Study the size of your current market. Determine the total market potential in both dollars and volume. Secondary data should help you with this analysis. Next, determine what your market share is within that market. Are you increasing market share versus the competition, or losing it? Also, realistically determine how much growth potential there is in the market. Is it still a growing market or is the market at saturation point?
Evaluate. The next step is to evaluate your product line and determine what new products you can develop based on both primary and secondary research. Study your competition. Find out why they are successful in certain markets. Study their strengths and weaknesses. Compare your strengths to theirs. Determine ways in which you can gain a competitive advantage.
Forecast. Do a 10-year market forecast for both existing product lines, product extensions and new products. Determine the total market potential in this new market (s); and make estimates on what your market share will be in the next year or two. You will also need to consider increased costs. For example, it will take more sales reps to cover the additional markets. Research and development costs will increase. You may even lose money the first year, but focus on the long-term potential of these the new market(s).
New markets. Select new markets for your products. Finally, develop your marketing plan. You can learn how to create a great marketing strategy by taking online courses in marketing. Decide the amount of capital you need to invest in the new products. Allocate money toward your mix of advertising and promotions. Decide on logistics.
Test new markets on a regional basis before going national or international.