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Market estimation

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  • 1. WELCOME TO THE ENTREPRENEURIALPROGRAM
    Today – Marketestimation
  • 2. Agenda
    QUICK GROUP PRESENTATIONS
    WHAT ARE YOU WORKING ON
    HOW WILL YOU WORK ON YOUR MARKET ESTIMATION
    MARKET RESEARCH
    DIFFERENT TYPES OF MARKET RESEARCH
    CUSTOMER SEGMENTS, TARGETING & POSITIONING
    MARKET ESTIMATION
    WORKING ON THE PROJECTS
    PROJECT STRUCTURE
    GROUP SUPERVISION
  • 3. GROUPPRESENTATIONS
  • 4. MARKETRESEARCH
  • 5. Why do market research?
  • 6. DefinitionMarketing Research is:
    ”The process of designing, gathering, analyzing and reporting of information that may be used to solve a specific marketing problem”
    (Burns & Bush, 2000)
  • 7. Beforedoingmarket research, oneshould have:
    A clear objective as to what the organization is aiming to achieve – both through marketing and corporate objectives
    A reasonable understanding of the targeted segments, and thus an ability to position the product or service
  • 8. HOW TO DO MARKET RESEARCH ?
  • 9. MARKET RESEARCH TOOLS
    Primary Research Methods
    Observations (going native + antropology)
    Focus Groups
    In-Depth Interviews (In person, mobile, Skype or by using video conference)
    Questionaries(personal, mobile, online, e-mail)
  • 10. MARKET RESEARCH TOOLS
    Secondary Research Methods
    (Desk Research)
    Intern information (sale, payment, inventory)
    External information (Published or Commercial market research reports, Information about competitors, Government reports, Industry specific homepages
  • 11. Market Research
    Ask the customerswhattheywant
    Ask the customerswhattheydream of
    Talk to ”non-customers”
    Talk to competitors
    Understand the competitors’ business model
    Know the positioningmap of the industry
    Talk to distributors
    TEST!!!
  • 12. WHAT CAN WE LEARN FROM TOMATO SAUCE ?
  • 13. STP)
    Segmentation
    Determinations of variables thatwillinfluencewhichcustomer segment youfocuson
    Targeting
    Howmany segments shouldyoutarget?
    Which segment shouldyoutarget?
    Positioning
    Which position within a segment do youwant to obtain?
  • 14. Definition
    Segmentation is the ability to:
    ”…divide the markets into groups, or clusters, of customers based upon realistic and meaningful criteria so as to offer clear, targeted benefits to every customer”
    (Wright, 2004)
  • 15. SEGMENTING BY MARKET TYPES
    Mass Market = Undifferentiated
    Segments = Homogeneous groups
    Niche = Specialized customer segments
    Multiple segments = You serve multiple segments at once – examples could be Google or even Golf courses
    Customized or individual = Dell
    Local customer groups = You tailor the offering to meet local needs
  • 16. Targeting
    Targeting = Which customer segment should we aim at?
    Can we spot any gaps in the market?
    Look for fit between strategy and resources
  • 17. Positioning
    The percieved position of the brand!
    Does it differentiate from competitors
    Is there enough customers in that place?
    Multiple positioning strategy = Procter & Gamble
  • 18. MINI CASE - 15 min
  • 19. List of car BRANDS
    FORD
    FERRARI
    BMW
    VOLVO
    MERCEDES
    KIA
    TOYOTA
    MINI
    SEAT
    SUZUKI
    RENAULT
  • 20. Positioning map for cars
    Niche Market
    Sporty
    Safety
    Mass Market
  • 21. How to Estimate the market potential?
  • 22. Estimating Market Potential Check-List
    Estimating the market or market potential for a new business or business expansion is critical in determining the economic feasibility of a venture. Estimating the market potential will determine if the market is large enough to support your businesses.
    What type of customer will buy the product or service?
    Where are these customers located?
    How many potential customers (N) are there?
    How often do they consume or use it?
    What is the Competition?
    What are people paying?
    What is the Potential for the Market to Develop?
    What is my share of the Market
  • 23. Cornmaze in WakeCounty, Georgia
  • 24. Estimating Market Potential:
    Key Steps in Estimating Market Potential:
    1. Define your target market and market segments.
    2. Define the geographic boundaries of your market.
    3. Derive average expenditures for the category.
    4. Determine the average household income for the area and state.
    5. Estimate market share
  • 25. Estimating Market Potential:
    MP = market potential
    N = number of possible buyers
    P = average selling price
    Q = average annual consumption
    FORMULA: MP = N x P x Q
  • 26. Estimating Market Potential:
    EXAMPLE : Agritourism Market Potential Analysis
    Situation - estimate the market potential for a new corn maze in Wake County, Georgia. The
    facility will have a maze and hayride. Other activities include pig races, hay bale play grounds,
    and a petting zoo. The average price for corn mazes in the area is $8.00 per person. They plan to
    target children 8 years old and under. There are two other competing corn maze operations.
    These operations have been in business for over five years and have established a clientele.
    Estimating Market Potential:
    MP = market potential
    N = number of possible buyers
    P = average selling price
    Q = average annual consumption
    Number of potential customers (target market) =101,600 people under 9 years of age
    P - average selling price = $8.00 per person
    Q - consumption - assumes an average of 1.5 visits per year per child= 1.5
    MP= 101,600 * $8.00 * 1.5 = $1,219,200.00
  • 27. Estimating Market Potential:
    EXAMPLE :Agritourism Market Potential Analysis
    Adjustment: It is unrealistic to assume that the operation will capture 100% of the market given
    they are new and there are established operations in the area. Need to estimate our market share
    of the corn maze business in the county.
    Market share = Market potential * percent of the market captured.
    Assume each corn maze obtains 33% of the market
    Market Share = $1,219,200.00 * 33% = $402,336
    Use 20% and 10% to see how sensitive the market share number is and if these figures will
    support your business.
    Market Share = $1,219,200.00 * 20% = $243,840
    Market Share = $1,219,200.00 * 10% = $121,92
  • 28. How to dertermine THE Price LEVEL ?
  • 29. HOW TO - Calculating The Price:
    Cost-plus pricing. Used mainly by manufacturers, assures that all costs (fixed and variable)
    are covered and includes a desired level of profit.
    2) Demand pricing. Used by companies that sell their product through a variety of sources at
    differing prices based on demand.
    3) Competitive pricing. Price according to your competitors. Used in competitive markets with
    little product differentiation.
    4) Mark-up pricing. Adds a level of profit to the cost of the product being retailed. Also good
    for products that are co-packed.
    Evaluating Price Competitiveness:
    Investigate your competition. Are your prices in alignment with theirs? What is the
    value of your product relative to theirs? Do not be a price taker or implement a “me, too”
    pricing strategy if your product can be differentiated and offers a higher value than
    competing products. If your price is too high to compete directly in the market, look for a
    niche market that desires your product’s attributes and charge accordingly.
  • 30. How do I KNOW IF MY PRODUCT IS DIFFERENTIATED ?
  • 31. 3 criteria needs to be fulfilled
    Does my value proposition differ from what is currently being offered to the market?
    Is the segment large enough for my value proposition?
    Is it hard for competitors to imitate, copy or replace my value proposition?
  • 32. OK quality – BETTER in price and size
    OK price – BETTER in design
    OK service – BETTER in price
    Ok speed – BETTER in price and size
  • 33. EKSTRA
  • 34. Advertising Media
    Print Media
    Broadcasting Media
    Viral Media
  • 35. Newspapers: National & Local Newspapers
  • 36. Magazines: Consumer- & Professional Magazines
  • 37. TV & Radio
  • 38. 2 EXAMPLES on virale videos
  • 39. Corporate Blogs
  • 40. Personal Blogs
  • 41. TOP TIP on corporate bloGGING
    “…businesses with corporate blogs receive 55 percent more traffic than small businesses that don’t blog”
    Source: http://mashable.com/2010/07/20/corporate-blogging-tips/
  • 42. Billboard
  • 43. Billboard
  • 44. Billboard
  • 45. Billboard
  • 46. Billboard Battle
  • 47. Billboard Battle
  • 48. Ambient Media
  • 49. Guerrilla
  • 50. FLASH MOB VIDEO
  • 51. Mini Task
    Whichchannelsareyougoing to use?
    Find 2 potential channels for yourcompany
    Describewhyyou have chosenthesechannels?
    Howwouldyouusethem?
    Whatareyougoing to use it for?
  • 52. Thanks for today