Methods of Market Analysis
Clarke Ricks
School of Business, Liberty University
BUSI 690: Policy and Strategy in Global Competition
Dr. Hicks
April 11, 2021
Methods of Market Analysis
A company can always benefit from knowing more about the market they operate in.
One effective way to learn more about a market is to conduct a market analysis. There are
many different methods of market analysis to choose from, which means there are several
ways for businesses to perform a market analysis on the aspects of a market they want to
gain information about. In this article, we define mWhat is market analysis?
A market analysis is a process of conducting thorough research on a specific market.
Businesses typically use market analysis to determine whether a new product can perform
well in a market or if it needs adjustment before being presented to consumers. Market
analysis can also tell a business about whether it might be beneficial to enter a new market
by providing details about how a market operates and which businesses find success in it.
Conducting a market analysis can involve research into a market, exploring
demographic data and information about competitors and comparing financial data from a
company to similar companies in a market.
arket analysis and explore seven methods of market analysis. Why is market analysis
important?
Market analysis can be important for companies because it can inform their future
business decisions and marketing initiatives. For example, a business that wants to
introduce a new product to its current market can use a market analysis to understand what
steps they need to take to ensure its product is successful and appeals to the market's
consumers. Marketing analysis can also be crucial to companies that want to start
conducting business in a new market, as it can show company leaders how well their
business might perform based on data from competitors.
7 methods of market analysis
Here are seven different methods for market analysis:
Market research surveys
One popular method of market analysis is conducting surveys to collect market
research. Surveys are a great way to gain insight directly from consumers that can inform a
company about their experiences with a business, a product or another purchase they
make. A survey for market research might ask questions about purchasing experience, the
usability of a product or general customer satisfaction. There are many different types of
surveys a company can use, which can be helpful by offering large amounts of data to
consider. Here are a few types of surveys you might use for market analysis:
In-person surveys
Telephone surveys
Mail-in surveys
Online surveys
Email form surveys
Personal interviews
Personal interviews are another common method of market analysis that allows
companies to gather information directly from consumers. A personal interview typically
lasts for around one hour and is recorded for future reference. Personal interviews can take
place in person, over the phone or through telecommunication online. Most personal
interviews involve asking a list of prepared questions as well as unstructured questions that
allow for open-ended answers.
Companies who conduct personal interviews for market analysis might ask multiple
consumers the same set of questions so that they can compare their responses later to
identify any patterns or similarities in the consumer experience.
Focus groups
A focus group is a great way to collect information for a market analysis from several
consumers at one time. Focus groups involve gathering a group of consumers at a neutral
location and leading a discussion about a specific product or service. This can allow for
customers to openly share their opinions and viewpoints and learn from other customers
who might have similar experiences.
To collect information from a focus group for market analysis, most companies use
facilities with a one-way mirror that allows them to observe the focus group while it occurs
and take notes as well as video and audio recording equipment that can record the
discussion.
Consumer observations
Consumer observations can contribute to market analysis by giving companies insight
into how consumers behave when purchasing or using a product. One benefit to conducting
observations is that it helps a business collect information objectively by allowing them to
learn about consumer behavior without communicating directly with customers. This can
provide information that does not originate from opinions or personal feelings about an
experience, which can help prevent bias or consumers' influence on each other in terms of
testimony.
When conducting consumer observations, many businesses take video recordings of
customers in their stores that they review later to learn about their browsing, purchasing
and returning habits.
Field trials
Field trials are another effective method for market analysis, as they can give the
company information about how a specific new product might perform in their market. This
involves putting a new product on shelves at a few stores and observing the consumer
response. By observing how a product performs in a real-life sales situation, a company can
learn details like how many customers purchase the new product, which demographics of
customers seem to be interested in the product, whether the price seems to be accurate or
which elements of the product might need improvement.
Social media engagement
Keeping track of social media engagement is a modern method for conducting market
analysis. With the rise of technology, social media has increased in relevance and awareness
on a global scale, with many users discussing products and companies on various social
media platforms. Paying attention to social media engagement can show a company which
of its online marketing initiatives seem most effective and which products customers seem
most excited about. This can inform a company's decisions about how to design future
marketing campaigns and what elements of their business seem to receive the most
attention on their social media accounts.
To track social media engagement, a company might visit the analytics pages on their
social media accounts to analyze how many people engage with different types of posts,
which demographics seem to interact with the company's pages the most and which
platforms bring the most attention to a company.
Competitive analysis
Competitive analysis is a method for marketing analysis that focuses on a company's
competitors rather than their customers. Because performing the competitive analysis can
be a technical and complicated process, many businesses hire professionals to conduct
these analyses on their competitors.
Competitive analysis involves identifying a product or service and analyzing how
competitors perform in the market while selling similar products or services. To complete
the competitive analysis, a researcher might evaluate a company's competitors in terms of
sales performance, general strengths and weaknesses and opportunities to learn from their
techniques.
