Imagine that you are an entrepreneur looking to launch a new product on the market. Now, how will you know if there is a demand for this product, whether there will be sales and if your new endeavour will succeed? Well, to begin with, you will conduct a market assessment to help you answer some of these tough questions. Let us understand the process and importance of market assessment.
Market assessment or market analysis is a critical study of the potential a new product or service or idea has in the market where it is to be launched.
It educated the entrepreneur about the needs of the markets and the barriers and pitfalls he may face. Hence the entrepreneur can modify his strategies and develop a map or a plan moving forward.
Whenever an entrepreneur plans n entering a new market, launching a fresh product, making a new investment or even all together starting a new business he must conduct a market assessment.
We have seen, that too often a new product or campaign will be launched without adequate research and fail miserably. Instead of re-evaluating or correcting your plan afterwards, the smart thing to do would be to conduct your research beforehand.
There are still steps in the process of market research. Let us take a brief look.
1] Defining the Problem
This is the first step, where we must clearly define the objectives for this research project. Defining the objectives is essentially defining the problems you face or will face in the future.
This step is very crucial, so enough time, money and energy must be spent on it. Very often entrepreneurs waste a lot of resources performing research on the wrong subject.
2] Analyse the Situation
This is an informal survey of the information available related to our queries. It involves communication with informed people, ones with experience and expertise in the industry.
If the persons conducting the survey are unfamiliar with the environment and the industry, they must take the time to familiarize themselves. A clear understanding of the problem area is of an essence, and so this step is very important.
3] Collecting Relevant Data
This is the step where we collect primary data for our assessment. Remember the purpose is to get genuine customer reaction and feedback for a new product or idea.
So there can be many ways to gather this data. You can conduct an online survey, or the research can be done in person. The questions must be framed to obtain both qualitative as well as quantitative answers.
4] Data Interpretation
Raw data is not useful to the process of market assessment. The data must now be analyzed and interpreted. The complexity of your questions in the previous step will define the scope of this step.
However, the best option is to use experts and qualified professionals to carry out this step. Because any mistakes made in this step will ruin your entire project. The aim is to use the data and analyze it such a way that it can help us develop a plan to solve the defined problem.
5] Problem Solving
The findings from the previous steps will now be used to make the necessary marketing decisions. The interpreted data should form the basis of the decisions we take to achieve our objective or solve our problem. If the data does not help with making decisions then the assessment was a failure.
6] Marketing Plan
The findings from all the previous steps must be applied to form a marketing plan that helps us achieve the objectives of the project. The plan has to tailor made to our product or service.
By the end of the process, we may even find some unrecognized problems that need solving. So the final marketing plan will give the entrepreneur a plan n how to successfully market his new product in a new market.
Solved Question on Market Assessment
Q: What is secondary market research?
There are two types of researches, as follows,
- Primary Market Research: Research has done specifically and proactively for a specific purpose. Here data collection methods include surveys, questionnaires, interviews, focus groups etc.
- Secondary Market Research: Here research was previously done for another purpose. So we will re-purpose the data and see if any valuable information can be gathered from it. Such information is in libraries, books, online information etc.