What is the best way to write a market analysis report?
- BRAND BUILDING
- AUTHOR: KENSHŌ
- DATE: 20 JULY 2022
A market analysis report is a critical component of developing a business plan. The information it collects makes it easier to understand customers’ buying habits in a targeted market.
Our team at Kenshō has always been about words. We can help you implement the following steps and create a market analysis report while covering the data you’ll need to examine for entering a marketplace and ensuring your story gets told.
Define the objective of market analysis
Before starting the market analysis process, defining the report’s objective is essential. Is this market analysis report for internal or external purposes?
The former might involve changes to marketing tactics or developing innovative products to launch at a future time, while the latter might provide information for acquiring capital.
A good marketing services agency can help you answer these questions from an outside perspective or write a market analysis report for you.
Review the outlook of the market
When you know what to expect in the future for a specific industry, it’s much easier to understand the opportunities for success or failure.
Although there is a significant market gap for 8-track players in households today, that doesn’t mean people want that equipment. When you know if increases or declines are happening, the information allows for a more meaningful decision about proceeding.
The market size, product life cycle and projected growth are all critical data points to review during this step.
Find the target market
Who is the ideal customer for this potential idea? Is there a way to cater the product or service to them specifically?
Although it’s tempting to sell items to everyone, only a specific demographic is interested in what you have. Take the time to eliminate the mysteries about whom these people are in the marketplace.
Review several demographic categories, including age, family size, household income, geographic location, lifestyle preferences and occupation.
Once you have this information, you can create a customer avatar to understand the marketplace better.
Determine the market value
You can go from the bottom to the top or in reverse to estimate your market value for a specific idea. The latter tends to be the easiest to complete since it looks at a particular percentage based on a sales-to-total-people ratio.
If you have 50,000 targeted customers in a marketplace and earn 500 sales, you’ve achieved a 1% market share.
When you use a bottom-up research structure, you’ll need to include additional data points to reach an accurate conclusion:
- Determine where the products or services are sold.
- Calculate the price per unit.
- Identify confirmed competitors.
- Discover the number of expected consumers your efforts reach.
- Estimate how much consumers purchase over time.
Since additional information is required in the bottom-up market value determination, it typically provides more accurate results.
Understand the competition on the market
How can your business position itself to stand out from competitors in the marketplace? When some companies get most of the market share, it is essential to identify the niche areas where you can be competitive.
Identify the direct and indirect competitors in your marketplace. The first sells the same products or services, while the other offers something similar but different.
Look at their strengths and weaknesses, then evaluate your own. What leverage options do you have to enter the market?
Find the obstacles while analyzing the market
There could be some barriers to entry when analyzing the market. These obstacles put up roadblocks that could prevent you from reaching customers. Do you need marketing services? Would it be better to look at an internet marketing service?
Researching them at this stage reduces the risk of costly mistakes that could create legal consequences.
The best way to write a market analysis report is to get straight to the point. Provide the facts you’ve found, recommend necessary changes and revisit this data regularly to ensure operations align with current conditions.
If you need help with writing the market analysis report, Kenshō delivers the results necessary to press forward! Let’s start the conversation today so that you can have a more thorough understanding of your market and a professional to do your market analysis report.
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