What Is Market Analysis? How Can You Use It To Boost Your Business Plan?

What Is Market Analysis? How Can You Use It To Boost Your Business Plan?

Market analysis is a qualitative and quantitative evaluation of the market. It gives an in-depth insight into the volume of the market, customers buying history, competitors, and other economic factors that may affect the business. Market analysis helps decision-makers make sure they are not putting in their time, efforts and money at the wrong place and also establish whether there is enough requirement for the product that customers are willing to pay for. 

Sourcing information

Every business plan is unique therefore market analysis also needs to be specific to it. You may get information from official government websites such as the Department of Commerce websites or you can search the web for some credible information. Most likely, businesses have to gather information, analyze and comprehend the meaning of it in relation to their specific scenario.  

Comprehending market trends

Change is inevitable; this is so true for markets. Markets could be full of one particular trend today and the next day it could out, just like that. Hence, businessmen need to keep up with the trends in the market and upgrade their products and services accordingly. This is also a great way of showcasing to the investors and potential investors that you are always on top of the game by having all the knowledge relating to your market. 

Need insights into competitors? Market trends could also reveal what the competitors are up to, how they are banking upon various trends in the market, what are their strengths and weaknesses, etc.  

Put the result of the analysis into action

Market analysis generally includes an overview and description of the industry, market research and analysis, information on the target market, and competitive analysis. This requires inputs from multiple stakeholders – sales, production, technology, and marketing. All this means a considerable amount of time would have been put in to bring the market analysis together. All the efforts and time invested would go to waste if this isn’t used for productive purposes. 

Once the analysis is ready, managers can look at improving their processes or systems based on it. It is also a great approach to foresee any impending issues the business might face and take preventive actions or corrective actions can be taken quickly. 

Do all businesses need a market analysis?

In most cases, yes, if you are not aware of your target market, customer behaviour or what makes your product or service unique then market analysis can give a deep insight into these factors. When companies are ready to expand, market analysis can provide great information about the target market that can be used to assess the situation and chart out a plan. It is also a critical document that is needed when funding is sought; it gives the lenders a clear picture of your vision for the company’s growth.

In fact, as markets are so volatile usually companies prefer to do market analysis every year or two to keep abreast of all the happenings and changes in the market.

How frequently do you look at your market analysis?

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