Analyze Market Opportunities

Chapter I

Analyze Market Opportunities

MARKET OPPORTUNITIES

MARKET OPPORTUNITIES

CUSROMERS

COMPETITION

Analyze Market Opportunities – Customers

CUSTOMER Analysis

CUSTOMER Analysis

WHO are our target customers?•Individual Customers•Businesses or Organizations

WHO are our target customers?•Individual Customers•Businesses or Organizations

WHY should they buy our product and not our competitors'?WHY should they buy our product and not our competitors'?

Forces Affecting Consumer Buying

Cultural Forces

Cultural Forces

National values, such as an emphasis on material comfort, youthfulness, or patriotism

Ethnic or religious messages or priorities

Social ForcesSocial Forces

Friends, neighbors, coworkers, and other groups with whom people interact frequently and informally

Family members, friends: parents, spouses, partners, children, siblings

Personal Forces

Personal Forces

Age: including stage in the life cycle; for example, adolescence or retirement

Occupation, economic circumstances, and lifestyle (or activities, interests, and opinions)

Psychological Forces

Psychological Forces

Motives: conscious and subconscious needs that are pressing enough to drive a person to take action; for example, the need for safety or self-esteem

Perceptions (interpretations of a situation), beliefs, and attitudes (a person's enduring evaluation of a thing or idea)

Understand Consumer Buying Process

Recognize a Need

Recognize a Need

Your newsletter doesn’t provide financial information, so you need to subscribe to a new one

Search for more

information

Search for more

information

Surfing the Internet for extra financial information

Weigh the alternativesWeigh the

alternativesThat newsletter have all the information the old one provided, plus a detailed section on finances

Decide to buy

Decide to buy

Determining that the price is right, concluding that you've done enough "shopping around," and subscribing the newsletter

Example

Evaluate the

purchase

Evaluate the

purchase

You may feel satisfied, disappointed, or even delighted with your purchase; you may unsubscribe to the new newsletter or decide to buy it again

Marketing Major Directions

Marketing Directions

Marketing Directions

Recruitment of New Customers (acquisition)

Recruitment of New Customers (acquisition)

Retention and expansion of

relationships with existing customers

(base management)

Retention and expansion of

relationships with existing customers

(base management)

Learning about Consumers

Problem:How do your gather and use information about your target market?

Answer:By RESEARCHING and EVALUATING

Learning about Consumers

Reading newspapers, and trade publicationsTalking with customers, suppliers, and distributorsChecking Internet sourcesMeeting with company managers

Review your company's

internal sales and order

information

Gather marketing

intelligence

Perform market

research

Use secondary

data sources

Internal researchMarket surveysProduct-preference testsFocus groups

Government publicationCommercial dataSNA-Focus studyBusiness Information

Steps for Market Research

1. Define the marketing opportunity you will focus on

2. Establish your research objectives in exploring the opportunity you identified

3. Develop your market-research plan

4. Implement your market-research plan

5. Analyze the information

6. Present your findings

Evaluating ConsumersC

ust

om

er

Valu

e E

qu

ati

on

W

ork

sheet

Lifetime Value of a ConsumersW

ork

sheet

for

calc

ula

tin

g

the L

ifeti

me V

alu

e o

f a

Cu

stom

er

Organizations Buying Behavior

The straight re-buy

The new taskThe modified re-buy

Pressure to maintain the quality of your productPressure to maintain the quality of your product

Pressure to protect the account to keep rivals from encroaching on your business

Pressure to protect the account to keep rivals from encroaching on your business

Lengthy and complex decision process between your firm and the company

Lengthy and complex decision process between your firm and the company

Influences on Purchasing Decision Environmental Forces

Environmental Forces

Interest rates, materials shortages, technological and political developments

Organizational Forces

Organizational Forces

Purchasing policies and procedures, company structures and systems (for example, long-term contracts)

Interpersonal Forces

Interpersonal Forces

Purchasing staff members' differing interests, authority levels, ways of interacting with one another

Individual Forces

Individual Forces

An individual buyer's age, income, education, job position, attitudes toward risk

Cultural Forces

Cultural Forces

Attitudes and practices influencing the way people like to do business; for example, some people tend to emphasize the collective, not individual, benefits of doing business

Understand Organizations Buying Process

Recognize a Need

Recognize a Need

Determine characteristi

cs and quantity of

needed items

Determine characteristi

cs and quantity of

needed items

Ex: Our Bank needs a news flow, offering latest financial news and real time news alerts

Required technologyRequired

technology

Search potential suppliers

Search potential suppliers

Negotiate the final order

Negotiate the final order

Solicit bids or proposals

from suppliers

Solicit bids or proposals

from suppliers

Choose a supplierChoose a supplier

Assess the chosen

supplier's performance

Assess the chosen

supplier's performance

Ex: Available to all bank’s terminals

Understand Competition

Why should customers buy from you and not from competition?

You have to make it clear to customers what the benefits of your products are. That is, you must find, and sustain a competitive advantage that has meaning for your customers.

Perform a Competitive Analysis 1. Determine your competition

Existing competition Potential competition

2. Analyze each competitor Strategies Objectives Strengths & Weaknesses ways of doing business

Determine your Competition …Competitors are companies that satisfy—or that intend to satisfy—

the same customer needs that your firm satisfies.

Other players offering similar products to yours

Entirely new players in your industry

Companies that make substitutes for your products

Customers' power of comparing, set competitors against one another, and easily switch suppliers

Your own suppliers' power to raise their prices or reduce the quantity of their offerings

…Most companies have both existing and potential competitors. But companies are more likely to be hurt by their potential and emerging competitors than by existing rivals.

Analyze Competition

Strengths & WeaknessesStrengths & Weaknesses

Ways of doing Business

Ways of doing Business

ObjectivesObjectivesStrategiesStrategies

Competition Analysis

Competition Analysis

Analyze Competition – Strengths & Weaknesses

Share of market

Share of mind Share of heart

How much of your target market does the company sell to?

What percentage of customers say they'd prefer to buy from that firm before any other?

What percentage of customers name that competitor as the first one to come to mind?

Analyze Competition – SWOT

Analyze Competition – Ways of doing business

Reacts swiftly and strongly to any assault

Doesn't react quickly or strongly to other players' moves

Responds to certain kinds of attacks —such as price cuts or advertising campaigns

Slow-m

ovingSel

ecti

ve

A "

tiger

"

Unpredictable

No predictable reactions to marketplace changes

4 Capital Rule of Marketing

1. It is better to be the first than to be the best

2. If you can’t be first in a category, create a new category you can be first in

3. It is better to be first in the consumer’s mind than to be first on the market

4. Marketing is not the battle of the products, but the battle of the consumer’s perceptions relative to the products