4 Key Elements of Market Analysis
I recently attended a lecture on market analysis as part of the MaRS Entrepreneurship 101 lecture series. For those unfamiliar with the Entrepreneurship 101 series, it is a free weekly lecture series featuring key topics related to starting a successful business, aimed at social innovators, and technology and life sciences enthusiasts. Topics in the series include funding your business, marketing, recruiting, intellectual property and more.
This blog post will provide a brief recap on some of the main points of the market analysis lecture presented by Usha Srinivasan, Program Director at MaRS.
- Primary and Secondary Research Data Research is essential for any entrepreneur looking to build a good understanding of their market. Research data can be divided into two categories: primary and secondary. Primary research data can be defined as information collected by the researcher directly through instruments such as surveys, interviews, observations, or focus groups. Secondary research data is data that has been collected by someone other than the user. Secondary data is often easier and less expensive to collect than primary data, but it is wise to utilize more than one source for secondary data in order to validate the information available. By utilizing primary and secondary data, an entrepreneur can better understand their market, validate their assumptions, and adapt their ideas.
- Sources of Information In order to collect secondary data, it is necessary to know where to look. Usha explained that government statistics agencies, like the Conference Board of Canada, industry and market research firms, various professional organizations, the MaRS startup library and Entrepreneur‚Äôs Toolkit, are all great sources of information. One particular source of information that I use quite often is data.com. With data.com‚Äôs ‚Äúfind companies‚ÄĚ feature, you can set your own criteria to generate a list of organizations in your market segment. The more sources of information you know, the more likely you will be to find the information you’re looking for. It will be important to gather data throughout the life of your company in order to watch for changes in the market and be prepared to adapt as needed. When it comes time to prospect research, feel free to try a few of my personal research tips.
- Important Questions to Answer With the types of data outlined above and some sources of information identified, Usha provided a variety of important questions that should be answered by entrepreneurs before launching their business. The questions she put forth included:
- Who am I competing with?
- What is the size of my market?
- Who are my customers?
- What is my business model?
- What is my value proposition?
- Tips To Be On Top of Your Industry Towards the closing of the lecture, Usha provided tips on how to be on top of your industry. She recommended that we attend industry and trade show events, track industry analysts, and subscribe to relevant industry journals and newsletters. By staying immersed in the news of your industry, you will be able to keep your market understanding up-to-date as the landscape changes. If you‚Äôre looking to stay up to date on sales, marketing and social media content, be sure to subscribe to the VA Partners newsletter.
To quote Schoolhouse Rock, ‚ÄúIt‚Äôs great to learn, ‚Äėcause knowledge is power!‚ÄĚ The more an entrepreneur knows about their market, the more likely they are to succeed and grow.