Whether established company, young start-up or founder of a new business - a market analysis should be carried out by all of them. Only then can they know how well their company meets or will meet the market requirements. Only then can they know whether the market will accept their product, how the industry is developing and much more. Opportunities and risks can be identified in good time, which enables promising business decisions to be made.
To perform an analysis of the market therefore not only makes sense for every type of company, there is no way around it. Especially if you want to build a good foundation for the success of your company. But what exactly is a market analysis?
What exactly is a market analysis?
A market analysis is a systematic examination of the markets relevant to a company. They are intended to help identify potential opportunities and risks at an early stage. This serves to assess how potential customers react to the offers of the respective company. These analyses can be carried out either by the company itself or by specialists (external providers).
The aim of a market analysis is to obtain as much and detailed information as possible about the market and relevant influencing factors. The results of the analysis form the basis for making company-relevant decisions.
Especially founders of a new business should intensively deal with the implementation of a market analysis. After all, it is the starting point for sales forecasts and thus for financial planning. Thus, an analysis of the market is part of every business plan, which is indispensable for finding investors.
Whether founder or established company - both look at the market, especially the sales market, when they carry out an analysis of the market.
There are several numerous points to consider, such as
- Market size and market growth (past, present, future)
- Market stability
- Competition and market leader
- and/or the customer structure
Each market analysis is different - The partial aspects
As a rule, the sales market is the most important for companies. However, other partial aspects can also be included. Thus no two market analyses are alike. The partial aspects include:
- Sales analysis
- Product analysis
- Analysis of the procurement market, the labour market or the financial markets
- Product analysis
Performing the market analysis - procedure
Regardless of whether companies are conducting a market analysis, launching a marketing campaign or looking for new employees. A systematic and sensibly structured approach should always be the top priority. This ensures that no important points are forgotten or mistakes made.
- Formulating the objective of the market analysis
If you do not set a goal, you cannot achieve anything. Therefore, any analysis of the market should start with a formulation of objectives.
Why is the market analysis carried out? Do you want to launch a new product or start a company?
- Define and describe the target market and target groups
Once the objective has been formulated that the analysis of the market is to be pursued, the target market and target groups must be defined. In doing so, it is important to differentiate markets from each other and to describe target groups as precisely as possible (age, gender, income, consumer behaviour, etc).
- Analysis of market size and development
The current size of the target market forms the basis for reliable forecasts of further market development. Growth rates represent the attractiveness of the selected market.
- Analysis of the competition and potential customer segments
Within this step it is necessary to identify the strongest competitors. The positioning of the own company also results from this analysis. In addition, the customer segments that promise the highest turnover in the selected market are determined (B2B, B2C)
Market analysis - Data is King
Without data and information no market analysis is possible. There are various methods of data collection: primary market research on the one hand and secondary market research on the other.
In primary market research, new data is collected by the company itself. For example, experts or members of the target market can be interviewed. Social media data, existing CRM and sales data and the company's own employees can also provide relevant information.
Secondary market research, in turn, draws on already existing data. This data should come from trustworthy, reputable and reliable sources. Companies can draw on data sets from the following institutions, for example:
- Federal Statistical Office
- Statistics portal statista.com
- Office for economic development of the respective municipality
- Chambers of Industry and Commerce and Chambers of Trade
- Annual reports of companies
- public bodies such as Deutsche Bundesbank
Established companies often commission market research institutes to collect data, while founders (for cost reasons) usually deal with this themselves.
Conclusion: Market analysis as a basis
A market analysis helps every company to get to know and understand the markets in which it is (or wants to be) on the move. This makes it possible to better assess opportunities and risks, as well as to recognize potentials and trends in time. Thus it forms the basis for future success for every company.
Extra: Recognize trends early - SigniTrend makes it possible
Closely linked to an analysis of the market is the recognition of trends. If trends are recognized early, market potential can be identified earlier and therefore better exploited. The best solution for recognizing trends early on is called SigniTrend. SigniTrend ("Significant Trend") is a development of the LMU Munich, which was further developed at the University of Heidelberg.
With the help of SigniTrend, it is now possible for the first time to recognize trends and events within a short time in posts, news and comments. The most important keywords are then bundled together in a kind of mind map and displayed at a glance. The larger the word, the higher its significance or frequency measured by the probability of occurrence per word.
We have also written a more detailed article about this. As part of a market analysis, companies should use the potential of SigniTrend.
Here you can find more useful information: