Market assessment: steps for conducting a market analysis

How much do you really know about the market terrain you’re planning to conquer next?

Venturing into new business territories requires more than just a good hunch. A full target market assessment should be your first point of action, including a target market analysis and competitor analysis.

If you start with a market assessment and make data-driven decisions based on the outcomes, it’ll directly impact your bottom line. Studies have shown that businesses that make a habit out of conducting market research are significantly more likely to increase their revenue over the last 12 months (76%), compared to those who only conduct market research sporadically (65%).

Market assessments go beyond finding gaps in the market. When done right, they can reveal strategic routes to take, help you reduce costs and optimize your messaging. So, how do you conduct a market analysis the right way? That’s exactly what we’ll cover in this article.

What is a market assessment?

A market assessment is a thorough analysis of key factors that shape market dynamics, including market size, market share, consumer behavior, and competitive landscape. It helps you gauge market potential, identify target customers, and anticipate challenges and opportunities. This knowledge empowers you to make informed decisions regarding product launches, strategic choices, or other business challenges.

In other words, a market assessment is made up of a range of smaller assessments of specific elements of a market, based on the goals of your research – but more on those later. Let’s look at which basics you should always cover, and how you can add on to them for a more in-depth market analysis.

The basic components of a market assessment

• Market size: Before you can set any targets, start by determining the total volume or value of a market to get an initial idea of the potential scope that’s even available for your product or service. This helps you establish more realistic KPIs.
• Market share: Find out what your company’s proportion of sales is within the market to compare your brand’s strength and presence to competitors. You can do this not just in terms of sales, but also brand awareness and other brand health metrics.
• Target customers and potential customers: Identify the people that are in this target market, based on demographics and psychographics. Look at both customers who are already buying, and those who aren’t yet.
• Consumer behavior: Get to know what those consumers in this market are thinking and doing. Check their buying patterns, how they respond to new products and marketing and how they act in other steps of the customer journey.
• Competitive landscape: Learn who is currently operating in the market, what their strengths and weaknesses are, and how they are viewed by the consumers in this market.

Advanced components of market assessment

Once you’ve laid the foundation for your market assessment, it’s time to add building blocks that help you answer the specific questions you have.

• Market dynamics: How are economic changes, technological advancements, and regulatory environments affecting market conditions, and how should your business operations adapt?
• Emerging trends: Identifying up-and-coming trends and analyzing their importance for your long term strategy helps you stay ahead in the market, and mitigate the risk of jumping on a hype that’s about to pass.
• Segmentation analysis: Once you’ve got your target market mapped out, you can start segmenting based on more detailed behavioral, psychographic, and geographical segmentation. This can reveal unexploited niches and opportunities for personalized marketing.
• Value chain analysis: With this you can examine your industry’s value chain from raw materials to end-users to locate any inefficiencies, potential partnerships, or areas for innovation.
• Regulatory landscape: Getting an in-depth look at the latest specific laws and regulations governing the market that could pose barriers to entry or opportunities for disruption helps your business stay compliant, and competitive.
• Scenario planning: This involved creating detailed predictions about the future market conditions based on different assumptions about how current trends could evolve.

Want to know more about how you can make your market assessment a success? Check out the first-hand advice from these twenty trusted experts.

How to conduct a comparative market assessment

A market assessment isn’t simply about collecting data; it’s about getting specific knowledge that gives you a competitive advantage in your market. This will enable you to create a strategy that aligns perfectly with your business goals and the market dynamics. You get to know all the external factors at play, so you can tap into your business’s strengths. But how do you make sure you collect the right data?

For any market analysis, preparation is key. We’ll walk you through the must-do steps of conducting a market analysis, while keeping the focus on gathering actionable insights.

Step 1: Define the goal(s) of your market assessment

First, determine which questions to answer in your market analysis? Because a market assessment is best done when it’s targeted at solving a specific question, whether that revolves around industry trends, marketing shifts, customer buying habits or if you need a comparative market analysis.

The more targeted your research is, the more accurate and actionable the results will be. Here are some example questions you can draw inspiration from.

• How can we modify our product features to better address the unique challenges or preferences of the new market?
• Which customer behavioral trends can we leverage to design more engaging marketing campaigns?
• What new technological advancements can we integrate into our offerings to enhance product appeal in the target market?
• What specific strategies can we implement to enhance customer loyalty in a highly competitive market?
• Which distribution channels have untapped potential in the target market that we haven’t fully exploited?
• What are the specific risks of entering this market, and how can we design strategies to mitigate them effectively?

Step 2: Prepare resources and assemble your team

Here’s how you make sure every part of your resources, human or monetary, is put to good use:

1. Build a cross-functional team: Assembling a diverse team that spans various specialities within your organization makes it easier to really own this market assessment journey and make it as actionable as possible. At the end of the day, the actions you take based on the outcomes will affect the whole business — directly or indirectly. Involve not just marketing or product development, but also customer success, sales and product managers to see how you can make this research valuable for everyone. The more aligned everyone is, the better the results will be.
2. Equip them with the right tools: Even if this is your team’s first time doing a market assessment, the right tools will make sure you get relevant, accurate and actionable data in no-time. With a tool like Attest you can quickly send out surveys to your target audience. When the results start coming in, our platform’s visualization capabilities make it easy to find the answers you’re looking for, and to communicate your findings with the wider team.
3. Leverage dedicated expert support: At Attest, each client (no matter the plan!) gets access to a dedicated research expert. This personalized support helps you conduct a market analysis that is not only powered by sophisticated technology but also guided by expert human insights.

Step 3: Develop a research plan

You’ve got your end goal, you’ve got your crew, and you’ve got the tools. Now it’s time to map your research strategy with military precision. Here are some things to lay out in this research blueprint:

Data collection:

• Primary research: Find the most suitable methods to gather first hand data. Decide if you will use surveys, focus groups, interviews, observations or experiments, depending on the goals of your research, and your available resources.
• Secondary research: Choose which existing data you’ll get from market reports, industry publications, and online resources.

Timeline:

• Set milestones: Break down your research plan into manageable phases, and assign realistic deadlines for each.
• Track progress: Set up a system to monitor your progress against the timeline to make sure you stay on track and can adapt as needed.

Target audience and sample selection:

• Identify your target audience: Which part of your target audience is most relevant for your research? This could be potential customers, people who have bought from you in the past or a mix of both. Clearly define who it is you need answers from before you send out any surveys.
• Select sample size: Make sure you have a representative sample from your target audience to participate in your research. The sample size should be big enough to yield statistically significant results and base your business decisions on.

Step 4: Conduct goal-oriented market research

This step is where your planning hits the pavement. Depending on your objectives, you’ll tailor your market research methods accordingly. Here’s how to make sure your market research delivers the insights you need:

• Mix primary and secondary research: Augment primary research data with secondary research to complete your market overview and test whether or not your findings are in line with other research.
• Segment your research efforts: Target specific segments such as demographic groups, geographic areas, or consumer behaviors to uncover detailed insights that broader analyses might miss.
• Balance qualitative and quantitative data: Use quantitative research to quantify behaviors and opinions and combine this with qualitative research to get to know the reasons behind consumer decisions.
• Stay flexible and responsive: If initial data brings new insights or challenges your assumptions, be ready to adjust your research direction.
• Maintain high standards for data integrity: Keep a strict check on how you collect, store, and analyze data to ensure its accuracy and reliability.

Step 5: Analyze data and identify opportunities

Now that you’ve gathered a mountain of data, it’s time to sift through it to find the gold. These best practices help you analyze with practical precision:

• Visualize your findings: Use charts, heat maps, and graphs to bring the data to life. This helps you spot trends and outliers you’ll probably overlook in a spreadsheet.
• Compare with benchmarks and competitors: Measure your findings against industry standards and what your competitors are doing.
• Explore relationships in the data: Look for connections between different data points, even if they seem random at first. These links can reveal what influences customer behaviors and preferences.
• Apply predictive techniques: If you can want a leg up in planning, use predictive analytics to forecast future trends.

Step 6: Create actionable strategies

Here’s how to make sure your strategies are not just plans on paper but driving forces for real growth:

• Determine immediate and long-term actions: To keep momentum while staying aligned with your strategic business goals, break down your insights into actions that can deliver quick wins and those that build long-term value. Prioritize and plan accordingly.
• Collaborate with executing teams during strategy formulation: Develop these strategies with input from the teams that will implement them. This helps in creating plans that are realistic and keeps teams committed to the vision, rather than just being puppets in a play.
• Run pilot tests: Before going full-scale, test your strategies in controlled environments. This could be a specific geographic area or a demographic segment, depending on your strategy.
• Benchmark against KPIs: What gets measured gets managed. Establish clear, measurable key performance indicators for each strategy.
• Regularly review and refine: Make it a habit to have periodic reviews for your strategies. This helps them remain effective and aligned with market dynamics, and enable you to pivot or scale efforts based on performance and feedback.

Take the first step towards better market insights. Get started with a demo for Attest today, and have results within days.

Why is a market analysis essential before you expand?

Before entering a new market or when adapting to market shifts, it’s crucial to have a clear picture of just why a market analysis is so valuable. Here are just a few reasons you should never skip market research when seizing potential business opportunities.

Navigate risks and seize opportunities: Even with research done, there’ll be risks in market expansion. But understanding these risks beforehand helps you create robust strategies and prepare for potential challenges. At the same time, you can also act quickly on openings for growth.

Refine operations for new markets: What works in one market, won’t necessarily work in another. Market analysis can show you exactly how to tailor your operations to new market demands.

Build stakeholder confidence: You’ll need reliable data to build your case when presenting expansion plans to stakeholders. A thorough market analysis can help you to demonstrate growth potential based on solid data, which can be key in securing the necessary backing and investments.

Stay competitive and future-proof your business: You’re entering the market once, but you’ll have to stay relevant forever. Continuous market analysis is vital for keeping pace with market trends and competitor actions.

Tools for market research and marketing analysis

• Market research/survey tools: Capture direct consumer feedback; Attest offers deep survey capabilities and analytics. Explore our market analysis service.
• Research databases: Access extensive industry reports and market data. Reliable resources include Statista and IBISWorld.
• Analytics and data visualization tools: Analyze and visualize data effectively with tools like Tableau and Google Analytics.
• Social media monitoring tools: Track online brand mentions and trends using platforms like Hootsuite and BuzzSumo.
• Competitive analysis tools: Monitor and analyze competitors’ strategies with tools such as SEMrush and Ahrefs.