A market analysis is required for a business plan to be complete.Every business person has to think about the two things that the market analysis provides: information about customers and the competition.The process of writing one will give you insight into how markets work and how your business can thrive in one.To write a proper market analysis, you will need to do extensive research, gather data, and present it in an effective manner.
Step 1: Determine what information you don't know.
Market research can help you market your business.Write out what you don't know about your potential customers.Consider the size of your market.You might want to start a business that caters to children.Do you know how many people have children?These people are likely to be your customers.Media habits.Do you know what your customers read?This information is needed if you want to use paid promotions.Income.Do you know how much money your consumers make?How much you can charge will be affected by this information.
Step 2: You can use publicly available information.
You might want to know the number of people who live in a city.The information should be made public.The U.S. Census Bureau compiles data by zip code.
Step 3: Information should be pulled from social media.
You can pull demographic statistics if you have a social media presence.When following someone, look at their age, gender, and location.
Step 4: Contact the industry associations.
Basic information about your market will be needed.You can inquire about the current state of the industry from an industry association.You can check it out online.Associations often publish surveys.
Step 5: Take a survey of your current customers.
Your current market is not your target market.If you want to develop a regional landscaping business, you might only be mowing lawns locally.You can get important information from your customers.You can ask them to fill out an online survey if you have their email addresses.If you give customers a printed receipt, you can put the survey on it.Ask your customers why they do business with you.Do they buy because of something?If they see your promotional efforts, ask.How did they learn about your business?
Step 6: Hire someone to do market research.
You might not know where to start or what to look for after a lot of searching.Hire someone to do market research.The person can perform consumer surveys.If you want to save money, you can hire an independent market research consultant.Consultants charge between $75-150 an hour and can organize focus groups or conduct a mail or phone survey.You could also talk to a professor.A professor at a business school might be willing to help with market research for free.
Step 7: Take a look at your competitors.
There is a competitive analysis in each market analysis.You should look at your competition's strengths and weaknesses.It is easy to see your competitors.Do business with them when you stop in.You can get a sense of how the public views your competitors by reading online reviews.Take complaints with a grain of salt.A real problem is revealed by consistent complaints about price.
Step 8: Pick out your audience.
A market analysis can be simple or complex.It should be tailored to your audience.If you are looking for investors, they will need more information than if the business plan is only for internal use.
Step 9: Define your target consumers.
They should include demographic information such as their age, income, location, and gender.Also describe their hobbies.If you are running a children's clothing boutique, you might want to target stay-at- home moms who are middle class.Businesses target multiple market segments.A coffee shop could target people who work within a five mile area as well as teens and the elderly who drink coffee.When identifying your market segments, be realistic.Not everyone is a potential customer.
Step 10: What market do you want to satisfy?
There is a consumer need for your products or services.The needs of parents who want to dress their children in unique outfits can be met by a children's clothing boutique.There is a need only after you have created your business.It will be difficult to get investors in this situation.For example, you could say that young parents want to establish their children's individual identify from an early age.A child's clothing plays a key part in how others view them and their parents.Status-conscious parents will be able to nurture their child's individuality with the unique outfits at Kid’s Couture.
Step 11: Analyze the industry.
You can offer a birds-eye view of your industry.The market has grown fast.What is its current size?National and local information is provided.Give the reader a sense of whether this is an established market or an emerging one.Coffee consumption in the US has grown at a 2.5% annual growth rate over the past 10 years.In northern New England, the retail coffee industry has grown twice as fast.
Step 12: Be aware of market trends.
Markets are not always standing still.You should keep a record of any changes you see.What are the changes in customer needs?Some products or services are gaining traction.Young families are moving into an area.As few young people move to it, the neighbor may be aging.The success of your business can be affected by these trends.
Step 13: Provide an analysis.
Discuss your strengths and weaknesses with your competitors.Explain how you can take advantage of their weaknesses.You might provide a different experience if you offer a service that your competitors don't.There is no one within driving distance who sells original children's clothing.Box stores might be the only competitors.A comfortable, at- home atmosphere that brand stores can't create is what a coffee shop might offer.
Step 14: The summary should be short and to the point.
The summary should be at the front of the analysis.A summary of the highlights is provided.The summary can be short.It is possible that this summary will be included in a loan application.
Step 15: The other parts of your business plan should be adjusted.
You might need to change other parts of your business plan based on your research.Your initial assumptions might have been wrong.You might need to change your marketing plan based on what you've learned.There is no reason to pay for expensive TV ads if your target market doesn't watch tv.If the demographic of a neighborhood is changing in a way that is bad for your business, you might need to relocate.You will need to change your pricing strategy if your market has less disposable income.
Step 16: Graphics are used to make information vivid.
It can be boring to read block paragraphs.Market analysis information can be presented using graphs, pie charts, and other visuals.Big chunks of text will be broken up to make it easier to digest.
Step 17: A business associate can read your analysis.
A fresh set of eyes can find errors.You might not have clearly identified your target market.A business owner who has written a market analysis can see areas for improvement.
Step 18: A business mentor can help.
You can stop into a Small Business Development Center in the US to get help with your business plan.The nearest SBDC can be found at https://www.sba.gov/tools/local-assistance/sbdc.You should make an appointment to discuss your market analysis.
Step 19: Take the time to read your market analysis.
Presentations matter.Potential investors will not invest in you if you have errors.Make sure you pay attention to the numbers and don't misplace a decimal or a comma.You will come back to your marketing analysis with fresh eyes if you set your analysis aside for some time.Set it aside for a few days.It's not possible to proofread from a computer screen.