An Introduction To Social Media Marketing In 2021
July 29, 2021
July 25, 2021
A market analysis is the process of gathering information about a particular market. It usually consists of qualitative and quantitative factors, such as the size in volume and value, how customers and competitors act, and the barriers to entry.
Ultimately, a market analysis plays a large part in overall market research. It helps businesses determine the risks and opportunities within the particular space they’re hoping to operate. To do so, companies will often look at both primary and secondary data to give an overall picture of the market.
The goal of your market analysis is to give you as much information as possible about the space you’re hoping to enter. If you’re launching a new product or service, you want to ensure that it has the best possible chance of success. To do so, you need to understand the conditions you’ll be operating in. A thorough market analysis can give you insights on:
Ultimately, it’s about understanding risks and opportunities. These factors are essential to understand, whether it’s to show investors the potential your business has or to plan your branding and marketing strategy.
As you might expect, there is quite a lot of detail you can go into when you’re doing a market analysis; we could write an entire article on each point. However, if you’re thinking about how to start a business for the first time, we’ve briefly outlined some of the main steps to consider:
When looking at the demographics and segments that you’re appealing to, there are several factors to bear in mind. One of the main considerations is whether you’re hoping to operate on a local, national, on an international scale. Depending on this decision, your demographics will be a lot different.
Other factors worth thinking about are the potential volume and value of the market. How many potential customers do you have, and how much is the market worth? You can use primary research (such as surveys and interviews), as well as secondary data (such as market reports) to estimate these factors.
Your target market is the types of customers that you’ll be hoping to sell your products and services to, within your market. Here, you have to consider the different types of people that might be willing to buy from your company and what their motivations are. As we explored in part three, your customer personas can go a long way in assisting with this.
The market need refers to the demand there is for your products or services. Understanding this market can help to show investors that there is scope for you to succeed in the market. Again, primary research can provide insight on this, as can determining what your competitors don’t do. Your unique selling point should be closely tied to the market need.
Another market consideration is who you’re competing against. You need to fully understand the marketplace, all of the current players, and which are your direct competitors. Explore their strengths and weaknesses, and benchmark your product/service against theirs.
Again, you should be able to gather plenty of data about your competitors based on publicly available records and press releases. Customer insight can also help. Combined, this should give you an idea of how you’ll perform against the competition.
You already know the strength of your business idea, but what’s to stop someone else immediately entering the market and taking your customers? You need to consider what these barriers are, how you’re overcoming them, and how you’re going to thrive in the market.
Factors that can prove to be a barrier to the industry include things like investment, technology, market regulation, and location. Consider each of these carefully when you’re carrying out your market analysis.
An essential consideration when thinking about how to start a business is reaching your target customers. Getting the word out about what you’re offering is vital, and you need to have a plan for how you’re going to do so.
We’ll get into the specifics of branding and marketing in the next section. For now, let’s focus on some of the ways you can plan your customer targeting activity:
By this point, you should already know who your target customers are. Your customer personas should highlight a range of different types of people that you want to try and reach. But what is it that they want? You need to consider the needs that are going to prompt them to buy from your business.
Think about what is currently preventing your customers from meeting their needs. Maybe it’s the price, accessibility, or the fact that they’re unaware of possible solutions. Then consider how those customers might view your business. How will they know what you offer? And what will convince them that you can meet your needs?
When you’re thinking about how to reach your target customers, you need to think in terms of what’s important to them, not you. You need to understand what’s important to your target audience and think about how you can talk with them in terms that matter to them.
This point feeds into areas of branding and marketing but also needs to be planned for. How are you going to engage with your customers? What type of messaging is going to appeal to them? And how can you build the trust and credibility that is going to secure their business?
Before you get on to planning your marketing activity and building your brand, you need to figure out where you can reach your target customers. There are all kinds of marketing channels you can make use of, across traditional and digital means. However, it’s pointless planning the majority of your marketing efforts for online mediums if the majority of your customers don’t often use the internet.
Data and analytics can play a big role in helping you define the right channels to reach your target customers. There is plenty of information out there, so it’s worth exploring how your target audience shops and researches their purchases.
Once you know how and where you can reach your target customers, it’s time to think about how you’re going to brand yourself and market to them. Again, this is another make-or-break area that needs careful planning. Not only will this help you reach your customers, but will also show potential investors or lenders that you’ve prepared appropriately.
People sometimes conflate branding and marketing. However, they are two separate entities and need to be considered as such. While marketing and advertising focus on preparing your business and spreading the word about your product, branding is a more internal and defining part of your business.
There are many ways to describe a brand and what it means. Essentially, your brand is your identity, as seen by your customers. It’s the promise you make to your customers about what they can expect when they choose your business above others.
Your brand goes beyond things like your business name and logo, although those factors are certainly important. It’s your reputation and the way that your customers describe you to others. As such, there are plenty of factors you can control, but there are also some that are harder to control.
Branding is what makes you memorable and stand out from a crowd. According to a 2015 global survey, nearly 60% of shoppers actively bought from brands they recognised. It also allows your customers and clients to get a firm idea of what to expect from you.
There are several other benefits associated with branding too. It can:
Building your brand is a crucial part of how to start a business. Yet it’s an ongoing process that requires forethought and attention. Essentially though, it can be broken down into three distinct areas:
Your marketing efforts will be what help to build brand awareness and secure new customers. As such, it’s essential to have an idea in place when you’re planning how to start a business. Marketing is an art form in itself, and understanding the basic marketing principles and practices can benefit your company going forward. In a separate article on how to create a marketing strategy, we explore the topic in further detail. For now, here are some points to bear in mind:
The first step is to figure out how you want to approach your marketing efforts. Before you can think about the specifics, you want to consider your overall goals and company vision. Again, a lot of the data and research you’ve already gathered will come in useful here. Your marketing strategy needs to take into account:
Essentially, it’s an overall view of how your marketing efforts will ideally play out. It’s often an evolving plan that takes into account your current and future situation.
Digital marketing is often the obvious choice when you’re trying to reach customers these days. You can read more about getting started with digital marketing in a separate article. However, it’s worth bearing in mind that it’s not the only option. As we mentioned earlier, you want to choose the channels that your target customers are going to frequently use. With that in mind, here are some popular channels you can explore:
One of the key things in planning how to start a business is how much your marketing activity is going to cost, and what you want the return on investment to be. We cover business finances in more detail in our next article, so for now, here are the important bits:
The final piece of the marketing puzzle is measuring how successful your actions are and how to make changes. Web analytics is an in-demand skill these days, and for good reason. It allows you to gain all kinds of insights on your customers, how they shop, and how they’re responding to your marketing efforts.
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