Marketing Analysis

 Although revision is the devil it’s best to get stuck in so let’s begin with Marketing Analysis. Woo Hoo!

 So what is marketing? This is the definition that you need to know to get the marks in the exam.

  ·        Marketing is a management process aimed at identifying, analysing and satisfying customer requirements usually at a profit.

 This is definitely something that needs to be learnt off by heart as it is a fairly specific and thorough explanation of what marketing is. The effectiveness of marketing however depends on exactly how much a firm knows about its market. This includes the size of the market, the potential for the product or products the firm is marketing to grow, and the market share that a particular firm has.

 Markets are usually split up into loads of different segments. As a result a business needs to ensure that they know exactly what their target market is including all of the possible market segments to which it will apply. Knowing your market is a fundamental part of market analysis and an incredibly important task for any developing business.

 An example of how a market can be split up into different segments is as follows.

 Market segmentation for the fashion industry:

Clothes                                  Accessories                              Famous Designers

Jeans, Dresses, Shirts            Belts, Handbags, Shoes           Calvin Klein, Dior, Versace

  

As you can see this is a very simple example of how an incredibly large market could be split up. There are hundreds of other segments which could be branched off each of the above subheadings so you can imagine how important it is for a company to ensure their product has an established and well defined target market.

 The only way to give a product the best chance of succeeding is by undertaking market analysis.

 This can be done by: Statistical Analysis, Market Research or SWOT Analysis

SWOT Analysis is an important market analysis tool. SWOT stands for: 

Strengths Weaknesses Opportunities and Threats

SW

Analysing the strengths and weaknesses of a business is known as an Internal Review. An internal review focuses on what the business is doing well and refers to everything that a company has already achieved or is in the process of achieving. It also highlights areas in which the company needs to improve in order to be able to compete in the market. This includes things like Company Reputation and Market Representation.

OT

Analysing the opportunities and threats to a business is known as an External Review. An external review focuses more on factors affecting a business that cannot be controlled by the firm itself. This includes things such as the State of the Economy, advances in Technology and progress of competitors.

 

Market Research is also a very important factor when analysing a market. Market research can be split up into two categories, Primary and Secondary. Here are a couple of definitions for these two terms that also could do with being learnt:

Primary Market Research - Research carried out by or on behalf of a firm which is specific to that firms needs, also known as field research.

Secondary Market Research - Research used by a firm or company which has already been carried out by some other source. Includes things such as government statistics.

 

Statistical Analysis, another useful market analysis tool is somewhat linked to primary and secondary market research. It involves the collection and or interpretation of statistics either from a primary or secondary source. Statistics can also be categorised as Quantitative or Qualitative data.

 

Ways in which these statistics can be collected are as follows:

• Sampling- Random Sampling or Quota Sampling. This is a method of splitting up a population in order to save time and money when surveying them.

• Creating a questionnaire. Questionnaires are cheap and easy to produce however they have drawbacks such as low response rates and unreliable data.

• Conducting a series of face to face interviews. Interviews generally create more reliable data but they are time consuming and hard to do a lot of them, this could make the data biased.

 

Once a company has conducted their research and gained all the relevant statistics their preliminary market analysis is complete. This research can then be given a Confidence level which is a measurement of how accurate and reliable they think their research is.