Market & Submarket Analysis

Market analysis builds on customer and competitor analysis to make some strategic judgment about the market and its dynamics.

Dimensions of Market Analysis

Emerging submarkets Actual and Potential market and submarket size Market and submarket growth Market and submarket Profitability Distribution system Trends and development Key success factors

Emerging Submarkets
1. Product or services to include new dimension- e.g. Indian Telecom 2. Market broken into niches - Lux Body wash 3. Application scope expanded from components to systems- HP computers 4. Emergence of new and unique applicationgreen Tea. 5. Reposition a product class.- Starbucks as retail coffee market.

Actual and Potential Market Size

Potential Market:- A new use, new user group& more frequent use change the size and prospects of market. E.g Kelloggs Ghost Potential:- products with potential can have ghost like quality by factors preventing its realization. E.g. E-Mobile Banking Small can be beautiful- Firms prohibit from investing in small markets- e.g. Apple

Market and submarket growth

Identifying Driving Forces:- what force leads to sales? Forecasting Growth:- Market sales can be forecasted by demographic data & sales related equipments. Detecting Maturity & Decline :- products growth phase changes to maturity phase 1. Price pressure caused by overcapacity and the lack of product differentiation. 2. Buyers sophistication and knowledge 3. Substitute products or technology 4. No growth source 5. Customer disinterest

Porters five factor model of market profitability

Competition among existing firm

Threat of potential entrants

Industry profitability

Threat of substitute

Bargaining power of suppliers

Bargaining power of customers