Not sure if your new business idea is good enough to succeed? Here are 5 best ways to test it. Read on to know more...
In a world with continuously developing technology, digitalization and automation, global networking, economic and cultural change. Many businesses today require innovative solutions so they can continue to exist successfully in the future. Many startups today, based on lots of previous business ideas with improvements and better managing systems offer a far greater amount of attractive market opportunities than before, with these types of practices taking place on a daily basis in the markets, have turned noticeably more complex and fast-moving.
Knowing every single detail of your potential market is an extremely important thing for making the best possible decision for your own business development. Looking at the increasing pace of the current markets, an in-depth market analysis plays an essential role. The objectives to identify should be suitable market opportunities, make meaningful forecasts and successfully implement investment plans, business plans, or marketing strategies.
Here we have some ways to evaluate a market, that’s helpful in identifying the overall attractiveness of a new market which includes knowing your consumer and the competition, analyzing the market thoroughly, exploring the adjacent opportunities, business development in your industry, and finding the right market research. If you’re thinking of starting a new business or expanding an existing business into a new market, it pays to do some research before you jump into anything.
1. Research your customers and competition-
Use your market research to analyze your consumer needs and competitors on multiple levels to get the best understanding. This will help you know the actual demand for a product/service and whether expanding into a specific new potential market would be profitable for your business or not.
Identify consumer segments that share common aspects such as age, gender, education, income, occupation, and area. Also, consider the consumer’s point of view towards your product/service. Understand what "job" is the customer trying to get done? What barriers are there that are blocking your way to customers’ hearts?
Knowing who your key competitors are and assessing their strengths and weaknesses can also illuminate specific growth strategies and ways to differentiate your products and services.
2. Know your Market-
Knowing your customers and competitors good but it’s not enough to remain in the market. You also need to obtain a vast understanding of the market as a whole and what the potential of success is in the market. Otherwise, your business could be stuck into thinking that a few percentage points increase is enough, where there is actually much more potential to grow.
When analyzing a market, these high-level questions comes into the picture:
What is the market size?
How quickly is the market expanding or contracting?
How many buyers are there?
What are the barriers to entry?
What is the bargaining power of suppliers?
What is the industry value chain?
What is the intensity of the competition?
Is there a possibility of new competitors or substitute products or services?
3. Explore Options-
Pursuing adjacent opportunities can also be a win-win strategy for you. The businesses with the most sustained profitable growth always have used a systematic, disciplined approach to expand the boundaries of their core business into an adjacent space. Some companies expanded from one geographic market to another, while others applied an existing business model to adjacent segments.
Always keeping an eye on the market and noticing even every slight change will help you to maintain a proactive approach and profitably outgrow your rivals by finding ways to expand outside your core business.
4. Business environment-
Another area to explore is the overall business environment, which can have a profound impact on company performance and the ways industries operate.
The business environment includes factors such as:
1. Technological developments
2. Government regulations
3. Geopolitical shifts
4. Economic indicators
5. Trade policies
6. Social and cultural norms
5. Research your market ASAP-
All the above-mentioned procedures can take significant time, effort, and expertise, but market research reports can give you a headstart.
“Off-the-shelf” reports, can supply you with much of the information you need for a comprehensive understanding of the customer, competition, industry, and business environment.
In such reports, you can find a decent amount of data on market size, market share, market forecasts, information on regulations, consumer demographics, and much more. In addition, many reports explicitly share analysis on key opportunities for future growth, next-generation product innovation, and emerging marketing strategies.