In order to craft your value proposition, you need to make certain assumptions about your target market. It is important to validate these assumptions through market research techniques and analysis. In this lecture, market research experts will introduce the principles of market research and analysis, including analytical frameworks such as the PEST analysis and Porter's Five Forces. Part of Entrepreneurship 101

4. Where
–
How
–
Am
I
going
to
Am
I
going
to
sell
–
sell
?
Geography,
Price
point
and
individuals
etc.
business
model
What
–
Who
–
Is
the
size
of
my
Am
I
compe4ng
market
?
How
much
with
?
money
am
I
going
to
Other
technologies/
make
?
Is
it
worth
to
subs9tutes
etc.
solve
?

10. Compe9tors
–
Customers
–
local
&
global
local
&
global
EcoWater,
Cuno,
Their
needs
are
Brita,
GE/Zenon
different
&
water
Al9cor
(Amway)
quality
is
different
Culligan,
Woojin
Coway
Distribu9on
channel
is
Highly
extremely
compe99ve
complex
–
pricing
&
Online,
through
business
models
-­‐
distributors,
water
Rental
&
direct
sales
depots,
new
or
MLM
property
developers

11. Where
am
I
going
to
sell
(geography)?
How
What
am
I
going
to
sell
is
the
size
of
my
(business
and
market?
pricing
models)?
Who
Which
am
I
compe9ng
industry
am
I
with
(technology/
selling
into?
company)?
Successful
Launch

12. Secondary
research
sources
• Websites
• Books
• Industry
Journals
and
Research
Publica9ons
• NewsleZers
• Third
Party
Analyst
Reports
• Company
Brochures
Primary
research
sources
• “Informa9on
specialists”
at
libraries
• Surveys
(online
–
more
quan9ta9ve)
• Focus
groups
(online
or
in
person
more
qualita9ve),
• Trade
shows
• Third
Party
Industry
Analysts
• Through
Social
Media
(facebook,
twiZer,
Quora)

13. Ques4ons
to
ask:
-­‐Is
my
technology
really
disrup9ve?
If
so
what
is
it
replacing
?
-­‐Who
is
my
direct
compe9tor
at
my
price
point?
-­‐Does
my
compe9tor
have
a
diversified
por`olio?
How
to
find
the
answers:
1. Consider
patent
or
prior
art
searches
–
Public
databases
like
USPTO
or
WIPO,
or
paid
databases
like
Delphion
or
Total
Patents
2. Understand
your
posi9on
in
the
“value
chain”
3. Compare
product/technology
capability/claims:
use
product
brochures
from
trade
shows
or
product
claims
from
websites
4. Conduct
a
SWOT
analysis
and
Industry
analysis
(Porters
Five
Forces)
to
determine
your
compe99ve
edge
in
the
industry

14. Favorable
Unfavorable
Strengths
Weaknesses
I
n
Capabili9es?
Compe99ve
Gaps
in
capabili9es?
Lack
advantage?
USP’s?
Price,
of
compe99ve
strengths?
t value,
quality?
Experience,
e knowledge,
data?
Financials?
Cashflow,
start-­‐
r Resources,
assets
and
up
cash
drain?
n people?
Loca9on
and
Accredita9ons?
a geographical?
Processes
and
systems
l
etc.?
Opportuni9es
Threats
E
x Compe9tors
vulnerabili9es?
Legisla9ve
effects?
t Industry
or
lifestyle
trends?
Environmental
effects?
Global
influences?
Compe9tor
inten9ons?
e
Niche
target
markets?
Vital
contracts
and
r
Partnerships,
agencies,
partners?
Loss
of
key
staff?
n Sustainable
financial
a distribu9on?
Tac9cs
–
major
contacts?
backing?
l

17. -­‐What
is
my
poten9al
market
vs
addressable
market?
(i.e.
What
you
wish
it
to
be
vs.
what
is
realis9c
?)
-­‐What
is
my
market
share
among
compe9tors?
-­‐What
is
my
market
share
in
Canada/Ontario?
1. Consult
market
reports
from
mul9ple
vendors
2. Be
clear
about
the
“defini9on”
used
3. Sizing
the
market
in
publicly
traded
space
can
be
easier
than
with
privately
held
companies:
a. BoZom
up
method
–
aggregate
revenues
of
all
players
–Tier
1,
2
or
3
–
You
are
likely
in
Tier
3
b. Use
unit
price
and
volume
of
sale
as
a
means
to
determine
market
share
of
the
company
and
total
market
size
b.
Look
at
annual
reports,
tax
filings,
press
releases,
Tech
blogs,
product
brochures
etc.
4. Market
sizing
at
regional
levels
is
more
logical
–
NA,
EU,
Asia,
Middle
East
5. Ul9mately
make
realis9c
assump9ons!!

18. -­‐Should
I
be
selling
my
products
outside
of
North
America?
-­‐What
are
the
cultural
&
gender
preferences
or
differences
in
that
market?
-­‐What
are
the
regula9ons?
Are
they
favorable
or
not
?
-­‐What
partnerships
do
I
need?
1. Consult
reports
on
customer
preference
and
behavioral
changes
–
Frost
&
Sullivan,
Datamonitor,
Forrester,
Industry
Associa9ons,
GLG
healthcare
2. Use
social
media
to
your
advantage
–
E.g..
P&G’s
teenage
feedback
on
feminine
hygiene
products
through
social
media
sites;
Consider
focus
groups
or
expert
advisory
panel
discussions
before
developing
a
product
3. Tap
into
Canadian
Trade
Commissioners
office
(DFAIT)
in
other
countries
–
as
simple
as
local
news
clippings
4. Complete
a
P.E.S.T
analysis
for
that
par9cular
geography
to
understand
the
Poli9cal,
Environmental,
Social
and
Technological
market
forces

19. Poli9cal
Economic
Government
Type
Business
Cycle
Stage
Government
Stability
Growth,
Infla9on
&
Interest
Rates
Freedom
of
Press,
Rule
of
Law,
Bureaucracy,
Unemployment,
Labor
Supply,
Labor
Costs
Corrup9on
Disposable
income/Distribu9on
Regula9on/De-­‐regula9on
trends
Globaliza9on
Social/Employment
Legisla9on
Likely
Economic
Change
Likely
Poli9cal
Change
PEST
Analysis
Framework
Socio-­‐Cultural
Technological
Popula9on
Growth/Age
Profile
Impact
of
Emerging
Technologies
Health.
Educa9on,
Social
Mobility
Impact
of
Internet
and
Reduced
Employment
PaZerns,
Aotudes
to
work
Communica9on
Costs
Press,
Public
Opinion,
Aotudes
and
Taboos
R&D
Ac9vity
Lifestyle
Choices
Impact
of
Technology
Transfer
Likely
Socio-­‐Cultural
Change
Likely
Technological
Change

20. -­‐Who
has
the
most
innova9ve
business
model
out
there?
i.e.
Can
I
apply
those
best
prac9ces?
-­‐What
is
my
pricing
structure?
-­‐What
is
my
revenue
model?
-­‐Should
I
white
label
or
license?
1. Use
focus
groups
to
determine
price
points
–
B2B
or
B2C
2. Give
considera9on
to
geographic
loca9on
before
pricing
your
product
3. Consider
manufacturing
yourself
and
sell
directly
or
“white
label”
to
tap
into
a
exis9ng
company/
manufacturers
with
name
recogni9on
in
your
market
place
4. Don’t
want
to
manufacture
it
yourself
but
license
it
out
to
others
–
Need
a
provisional
patent
before
pitching
your
idea

21. Should
I
be
selling
this
to
the
DOD
instead
of
healthcare?
Are
barriers
to
entry
low
in
certain
ver9cals?
Less
regula9ons,
price
agnos9c
?
Could
one
industry
be
my
first
entry
point
before
I
tackle
another
ver9cal?
Should
I
target
government
or
the
private
sector?
1. Understand
the
ver9cal
markets
of
your
compe9tors
and
target
least
compe99ve
ver9cals
2. Are
there
any
investments
happening
in
a
par9cular
sector,
government
agency
or
country
that
could
be
an
advantage?
a.
Aper
9/11
and
other
global
incidences
–
increase
in
security
technologies
b.
Cleantech
-­‐
Ontario’s
Green
Energy
Act
and
FIT
program
in
bringing
in
investors
into
the
province;
China
inves9ng
$5
B
in
cleantech
in
next
3
years

23. Is
there
really
a
market
need
here?
Whether
the
answer
is
a
“Go”
or
“No
go”
understanding
your
market
/
customer
/
industry
dynamics
will
be
key.

24. Usha Srinivasan PhD
Director of Market Intelligence
MaRS Discovery District
T 416-673-8144
E usrinivasan@marsdd.com
W www.marsdd.com
pg 24