Market analysis, market, marketing, environment analysis, Environmental factors
Age/Size/Structure of the population (the market of sewing machines is affected by the smaller size of families and by increasing women employment)
- The ageing population has an influence on health budgets.
- Social categories or/and average level of income (more unemployment : lower disposable income : more hard discounters)
- Living areas: % population in the countryside, small cities, big cities, suburbs of big cities...
- Level of education
All these factors can explain some government policies run for the long term (health policy, road safety policies )
[...] The micro-environment Competition analysis in four steps: Different competitive market: - Fragmented markets is divided in numerous small size segments many competitors with small market share each (household, appliances, publishing market) Concentrated markets few competitors with substantial market share each (drugs, food industry, mobile phone) Open markets access to market is easy (travel agencies, restaurants, real estate) Closed markets access to market is difficult due to either strong competitors , or specific customer habits or legislation , or high cost of entry in terms of technology communication (car industry, banking, luxury, mass distribution, aerospace) The 3 levels of competitive environment: Inter-product competition direct competition Inter-segment competition indirect competition Generic competition indirect competition Market analysis Market definition: To analyse and measure a market it is mandatory to define clearly its boundaries up-front. A market can be defined from 2 perspectives: - Offer perspective : Market is defined as being what users consider as all related or substitution products ( Product perspective) Demand perspective : Market is defined by all individuals who are interested or consume a defined product( Customer perspective ) The product/offer perspective: It is the company answer to a customer demand or nee. Ex: bottled water market. [...]
[...] Is it a seasonal purchase? Ex: beer or ice cream in summer, jewelry for Christmas or Mother's day important to plan promotions correctly and also to plan the implementation of products in store. Nature of the activity during which the product is consumed Ex: with cereals: for breakfast, but also for afternoon break, for a outdoor, for a picnic competitive products will not be the same depending upon the consumption occasion/moment. Why: why do people buy the product? Analysis of the purchase drivers and analysis of the purchasing process. [...]
[...] Competition analysis Porter's Analysis Tool box: Porter identifies 5 threats affecting existing competition. In Porter scheme the intensity of competition will depend upon: - The product differentiation (high-low added value vs. competitors ) The number of suppliers: monopoly (SNCF), oligopoly (oil industry, car industry), real competition (bread, meat) The barriers to entry which prevent new comers to access the market: - Heavy investments in technology , or patents / licenses are required The strong image of current brand can also be a barrier Entry is justified only if economies of scale are possible Criteria to use for a competition review: Company structure: the type of company, the number and type of suppliers, the organization type (holding, association, franchise . [...]
[...] Services (non tangible, travel, phone subscription . ) Who: who buys the products? Focus on the profile of consumers who buy the company's products. They will be described precisely in order to know better their expectations and to target communication better at them. Ex: In the breakfast cereals market, we calculate the average age of consumers depending on the type of product bought we can divide the market into 3 categories: children market, adult market and senior market. How: how is the product consumed? [...]
[...] The structure of a market: - Main market = all products and services identical to our product and which are directly competing with it Market of substitute products = all products of a different nature than our product but satisfying the same needs and motivations within the same consumption moments Generic market = main market and market of substitutes Market of associated products = is made of products whose consumption is strongly linked with the consumption of the main product The structure of a market examples: MAIN MARKET Paint Organized cruises Chocolate bars Tights SUBSTITUTE MARKET Wall paper, fabrics, wood, stone Individual cruises Tablets ,bite size , pralines Socks , stockings GENERIC MARKET Decoration Tourism Chocolate Female clothing The 4 ways to describe a market: What Who How - Why What: what is produced? Very simple product classification for a clear view of competitors. It is the way chosen by panel institutes. Durable goods (tangible goods) ex: cars, household appliances, phones. Non-durable goods (tangible goods) ex: cleaning products, food. [...]
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