Wanna build a prosperous business? Learn about the valuable conclusions and useful recommendations with market research analysis before launching the idea.
A professional marketer is of great help here! You ask, why?
It’s hard to imagine a person that has never encountered such a complex task painstakingly searching for competitors, their proposals, strategies and as a result creating a detailed plan on how to make an idea successful. More often people simply look through some websites, take some notes and sometimes make first steps without a plan leaving it to chance or luck. Guess what happens next?
How does a professional do a market research analysis?
In contrast, a specialist will do the whole research step-by-step:
Defining the problem and objectives
A market researcher may find that the actual problem or other important variables have been missed because the focus was too narrow. On the contrary, too much information may be collected. As a result, most of it won’t be used. In general, a problem statement helps to identify the aim of the research and its approaches defining the relations between variables or deep understanding of a phenomenon.
Developing the research plan
The purpose of the research plan is to find the optimal way to get all the answers to the research questions. There is so much stuff to consider while designing the research plan. There are data sources, types of research approaches, research instruments and the ways to limit distortions of the data, configure a sampling plan, protect the participant’s privacy and contact research participants. Not to mention the costs of the research plan implementation.
There are different types of data gathering: mailed or telephone survey, arranged or intercept interview, focus groups, and the most widespread – online data collection.
This might be the most complex step out of all. While analyzing you need to organize and, if needed, reduce the information. Different methods of analysis can be used here: Multiple Regression, Discriminant Analysis, Factor Analysis, Cluster Analysis, Conjoint Analysis, and Multidimensional Scaling.
Presenting the findings
Before showing the research findings a number of issues should be resolved. A market researcher should study the audience of the presentation and prepare properly to show the relevance towards their goals. Makes sure that the presentation is actionable, engageable, visual and the reasons for the research are clear.
Making the decision based on findings
It is very important to make the right decisions based on the research outcome. It may even change marketing strategies.
How to analyze competitors?
One of the main goals of the market research analysis is to identify the competitors. Knowing who your competitors are, and what they are offering, can help you make your products, services, and marketing stand out.
The competition analysis works this way:
- Information gathering
- Information analysis
- Definition of advantages over competitors
#1. Competition research
Research can provide you with valuable information about existing competitors, their adopted strategies, impact on target consumers (and their reactions), and other such details.
The questions below have to find its solution. They concern different areas.
About the company:
- How do they represent their brand?
- Do they innovate?
- How many employees do they have and what are their qualifications?
- Who owns the business and what sort of person are they?
- How social are they?
- How much do they gain?
- What financial resources do they have?
- What are their plans?
About the product:
- What is your competition selling?
- How much do they charge?
- How do they deliver their products or services?
- What additional service do they offer?
- What new products are they developing?
- How do they treat their customers?
- Do they have loyal customers?
- What tools do they use to enhance customer loyalty?
- What do customers see as the competitors’ strengths and weaknesses?
- What are their plans?
- What types of customer are they targeting?
#2. Information gathering
To answer the questions above the following sources of information will be of use:
It provides an indication of your competitor’s entire promotional program and budget.
They provide a wealth of product information, like features and benefits they’re using to sell their product.
Newspaper and Magazine Articles
Help to get an idea of what your competitor is planning for the future, how their organization is run, and what new product information or innovations they have.
Reference Books and Databases
It can give a vast volume of information about competitors. Some of it you might not expect.
They provide financial information, including sales volume, revenue increases, and their total market share.
It gives an opportunity to see first-hand what the competition is producing and discover new players – possible future competition.
Examining their products, services, marketing techniques, pricing, location is the direct way to find lots of unique info.
#3. Information analysis
Once all of the competitive data is gathered, it’s analysis time. The goal is to determine product information, market share, marketing strategies, and to identify the competition’s strengths and weaknesses.
SWOT analysis enters into force!
What is a SWOT analysis?
SWOT stands for Strength, Weakness, Opportunity, Threat. SWOT provides a tool to explore both internal and external factors that may influence your work. Using the SWOT framework, you can start crafting a strategy that helps you distinguish yourself from your competitors so that you can compete successfully in your market.
Consider the strengths from both an internal perspective, and from the point of view of the customers and people in the market.
Internal factors include strengths and weaknesses. General areas to consider:
- Human resources – staff, volunteers, board members, target population
- Physical resources – the location, building, equipment
- Financial – grants, funding agencies, other sources of income
- Activities and processes – programs and systems used
- Past experiences – building blocks for learning and success, the reputation in the community
External factors include opportunities and threats:
- Future trends in the field
- The economy – local, national, or international
- Funding sources – foundations, donors, legislatures
- Demographics – changes in the age, race, gender, culture of customers or in the area
- The physical environment
- Local, national or international events
Knowing the factors influencing the company helps to:
- Identify the issues or problems you intend to change
- Set or reaffirm goals
- Create an action plan
In general, SWOT analysis has to be applied towards not only the competitors but also your own company. It gives a bigger picture and a clear understanding of your position on the market.
#4. Definition of advantages over competitors
Once you have identified and analyzed your competition, and understand your competitive position, you are ready to do the following:
- Identify and discuss key areas of competitive advantage and disadvantage.
- Summarize the major problems and opportunities facing your firm which may require action.
- Develop and implement a marketing strategy that will strengthen your market position.
Of course, the market situation can change quickly, new players can emerge tomorrow, the economy may upswing or downswing at any moment.
But admit, the choice is obvious! Either you’ll have nothing or get valuable information about your potential position on the market. That’s what may become the foundation of your idea future success.
So it worth the effort! In result you have a real shot to receive a prosperous business.