The 10 steps you need to follow to start your project / STEP 3: MARKET STUDY
After verifying the consistency of your project with your own constraints and personal assets, you must now ensure its commercial feasibility by conducting a market study.
This fundamental step is a prerequisite for any future business leader, as it enables you to:
- Understand the major trends and players in your market, and to check the opportunity to get started, - Compile adequate information to enable you to generate revenue assumptions, - Making the best business choices to accomplish your objectives. - Determine, in the most coherent way possible, your "product", "price", "distribution" and "communication" policy (marketing mix). - To provide concrete and relevant information that can be considered when drafting a provisional budget.
I. To acquire a better understanding of the main trends in the market and its players and to assess the opportunity to launch a new business.
The appellation "market research" may intimidate those who, lacking sufficient competence, prefer to avoid or neglect this stage.
However, market research is above all a matter of strategy and sanity! It would be unwise to embark on a project without answering the following questions: * What are the main market trends? * Who are the buyers and consumers? * What are their needs? * Who are the competitors? * What is the environment of my market? It is a question here of identifying - The innovation processes and technological developments in your market, - Regulatory and legislative framework (required authorizations, diploma to be held. - Social, economic, political and ecological environment. * What are the constraints of my market and the keys to success? * What are the opportunities and potential threats?
* What do you need to master, hold, acquire to succeed in your market?
* Is there, yes or no, an opportunity for my project to succeed?
II. Set turnover assumptions
Based on a methodical analysis of the market, it is crucial that you can estimate a projected turnover.
As a result, you will be able to use this amount to supplement your financial forecast to determine if your project is financially viable. Be careful, these are only hypotheses!! To achieve a projected turnover, there are not one, but several calculation methods: - To study similar projects in your area or in other geographical areas. - To evaluate, as part of a field survey, the purchase intentions of potential customers. - To test your project in real life. Ideally, several methods should be employed to bring out a low and a high hypothesis.
III. Make the best choices to achieve your objectives
In terms of understanding the market, you will have to decide on ways to approach your customers.
We are in the midst of determining strategy.
Strategy is in fact the guiding principle that will enable your company to achieve the turnover you have previously set.
It is a balancing act between the best option and the best angle of attack, taking into account competitors, customers and the project. When setting your strategy, keep in mind how you will achieve your objectives by integrating yourself into your market in a sustainable way, while taking into account the specificities of your company! IV. Obtain the most consistent marketing mix possible
A marketing mix is the set of marketing decisions a company undertakes at a given moment, on a product or on its entire range, to influence and satisfy its customers.
These decisions concern: - Product: which product(s) or service(s) will you offer to your future customers? - Price: at what prices will you sell it (them)? -Distribution: how will you sell it? What will be your distribution networks (direct, with intermediaries, by internet)? -Communication: how will you make yourself known?
V. Provide concrete elements that will be applied to establish the provisional budget
By defining the different elements of the marketing mix, you are able to quantify the cost of the actions you plan to implement to get started.
- What will be the cost of manufacturing or producing the product, for example?
- What will the marketing costs be?
- Or, what will be the cost of promotion or communication?All these quantified elements will then be reintegrated into your company's financing plan.
VI. How to carry out your market research?
Firstly, by acquiring a minimum knowledge of the notion of "market" and the means of action that make it possible to act on a market. Then by following an orderly and structured approach: information research, conducting surveys, synthesizing and analysing the information collected, writing a report, estimating the provisional turnover, etc.