The word market is used in a few different contexts, from the local fish market to the Christmas markets that draw people from across the region. But a common use refers to an economy’s pricing system, where prices are determined by supply and demand. The concept is also used in the field of business, where market analysis helps identify potential opportunities or threats for businesses based on changing market trends and conditions.
Market research is a critical tool for small businesses that can reduce risks while ensuring a growth strategy aligns with customer expectations and industry trends. In today’s era of data-driven decision making, companies need reliable, up to date information, not guesswork, to drive revenue and growth.
There are three main components of a market analysis: industry examination, competitive landscape and voice of the customer. Industry examination gathers data about the customers within an industry, including their demographics, buying behaviors and needs. This information can help identify target audiences for products and services as well as begin forming value propositions. Competitive landscape analysis assesses the bargaining power of buyers and suppliers, competitive rivalry between players in the industry as well as any policies or regulations that limit entry into the market.
Voice of the customer analysis uncovers critical insights into how customers perceive your brand and product offerings. This can include customer feedback and perceptions, product or service reviews as well as augmented reality and virtual reality tools that offer immersive experiences to conduct customer testing and gather authentic, real-time data.