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ENTREPRENEURSHIP
Quarter 1 – Module 2: Lesson 1
ENTREPRENEURSHIP

Recognize a potential market and analyze the

market need
Entrep– Grade 12
Alternative Delivery Mode
Quarter 1 – Module 2: Lesson 2- ENTREPRENEURSHIP: The Potential Market and
the Market Need

First Edition, 2020

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Published by the Department of Education

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Writer: Amecia Ray D. Mamigo
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Anna Lee A. Amores, EdD

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Tele #: (035) 225 2376 / 541 1117
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ENTREPRENEURSHIP
Quarter 1 – Module 2 : Lesson 1

The Potential Market

and the Market
Need
Introductory Message
For the Facilitator:

Welcome to the Entrepreneurship Alternative Delivery Mode (ADM) Module 2,

Lesson 1 on the Potential Market and the Market Need.

This module was collaboratively designed, developed and reviewed by educators

both from public and private institutions to assist you, the teacher or facilitator in
helping the learners meet the standards set by the K to 12 Curriculum while
overcoming their personal, social, and economic constraints in schooling.

This learning resource hopes to engage the learners into guided and independent
learning activities at their own pace and time. Furthermore, this also aims to help
learners acquire the needed 21st century skills while taking into consideration their
needs and circumstances.

In addition to the material in the main text, you will also see this box in the body of
the module:

The ability to listen is as important as the

ability to speak.” -Sheryl Sandberg

As a facilitator, you are expected to orient the learners on how to use this module.
You also need to keep track of the learners' progress while allowing them to manage
their own learning. Furthermore, you are expected to encourage and assist the
learners as they do the tasks included in the module.
For the Learner:
Welcome to the Entrepreneurship Alternative Delivery Mode (ADM) Module 2,
Lesson 1 on The Potential Market and the Market Need.
This module is designed to provide you with fun and meaningful opportunities for
guided and independent learning at your own pace and time. You will be enabled to
process the contents of the learning resource while being an active learner.
This module has the following parts and corresponding icons:

This will give you an idea of the skills or

What I Need to Know competencies you are expected to learn in the
module.

ii
 This part includes an activity that aims to check
what you already know about the lesson to take.
What I Know
If you get all the answers correct (100%), you
may decide to skip this module.

This is a brief drill or review to help you link the

What’s In current lesson with the previous one.

In this portion, the new lesson will be introduced

to you in various ways; a story, a song, a poem, a
What’s New
problem opener, an activity or a situation.

This section provides a brief discussion of the

What is It lesson. This aims to help you discover and
understand new concepts and skills.

This comprises activities for independent practice

to solidify your understanding and skills of the
What’s More
topic. You may check the answers to the
exercises using the Answer Key at the end of the
module.
This includes questions or blank
What I Have Learned sentence/paragraph to be filled into process what
you learned from the lesson.
This section provides an activity which will help
What I Can Do you transfer your new knowledge or skill into real
life situations or concerns.
This is a task which aims to evaluate your level of
Assessment mastery in achieving the learning competency.

In this portion, another activity will be given to

Additional Activities you to enrich your knowledge or skill of the
lesson learned.

Answer Key This contains answers to all activities in the

module.
At the end of this module you will also find:

References This is a list of all sources used in developing

this module.
The following are some reminders in using this module:

1. Use the module with care. Do not put unnecessary mark/s on any part of the
module. Use a separate sheet of paper in answering the exercises.

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2. Don’t forget to answer What I Know before moving on to the other activities
included in the module.
3. Read the instruction carefully before doing each task.
4. Observe honesty and integrity in doing the tasks and checking your answers.
5. Finish the task at hand before proceeding to the next.
6. Return this module to your teacher/facilitator once you are through with it.
If you encounter any difficulty in answering the tasks in this module, do not
hesitate to consult your teacher or facilitator. Always bear in mind that you are not
alone.

We hope that through this material, you will experience meaningful learning and
gain deep understanding of the relevant competencies. You can do it.

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 TABLE OF CONTENTS
CONTENT PAGES

TITLE PAGE ------------------------------------------------ i

INTRODUCTORY MESSAGE ------------------------------ --- ii

For the Facilitator --------------------------------- ii
For the learner ----------------------------------------- ii

WHAT I NEED TO KNOW --------------------------------- 1

Learning Competency --------------------------------- 1
Learning Objectives --------------------------------- 1

WHAT I KNOW ------------------------------------------------ 1

Task 1 ------------------------------------------------ 1

WHAT’S IN ------------------------------------------------ 2
Task 2 ------------------------------------------------ 2

WHAT’S NEW ------------------------------------------------ 3

Task 3 ------------------------------------------------ 3

WHAT IS IT ------------------------------------------------ 4

WHAT’S MORE ------------------------------------------------ 7

Task 4 ------------------------------------------------ 7

WHAT I HAVE LEARNED --------------------------------- 7

Task 5 -------------------------------- 7

WHAT I CAN DO ---------------------------------------- 8

Task 6 ------------------------------------------------ 8

ASSESSMENT ------------------------------------------------ 9

GLOSSARY ------------------------------------------------ 10

ANSWER KEYS ------------------------------------------------ 11

REFERENCE LIST -------------------------------------------- 12

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 WHAT I NEED TO KNOW

Lesson 1: The Potential Market and the Market Need

This module is written for you to accomplish at home. It is carefully

designed so that you can work at your own pace and allow self-discovery of
the concepts through activities that you will perform. Activities are also
selected to allow independent learning which aims to develop your reading
comprehension skills through understanding written texts. You may start
your journey in learning about the potential market and the market need.

Learning Competency
The Potential Market and the Market Need.
(CS_EP11/12ENTREP-Oa-3

Learning Objectives:

After going through the module, you are expected to:

* Identify potential market and the market need.

* Determine the possible products/ services you could offer to the market to
meet the need.
* Show interest in identifying potential market and market need.

WHAT I KNOW
Task 1

Direction: Read and analyze the statements below. Determine whether the
statement is TRUE OR FALSE. Write TRUE if the statement is
correct and write FALSE if otherwise. Write your answer on your
notebook.

___________1. A market is any place where two or more parties can meet to
engage in an economic transaction and should only involve
legal tender.
___________2. Market includes retail stores and other similar businesses that
sell individual items to wholesale markets selling goods to
other distributors but may not be virtual.

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___________3. Market refers to the whole area of operation of demand and
supply.
___________4. A market signifies any arrangement in which the sale and
purchase of goods take place.
___________5. Market establishes the prices for goods and other services.
___________6. Markets are unified.
___________7. Markets can be controlled.
___________8. In business, research is not required.
___________9. Knowing your customer is very important.
___________10. Knowing your market/target customer is one of the priorities
in having business.

WHAT’S IN

Task 2

Give at least 5 top leading brands of products in our country and on each
product, give a short statement how it improves the lifestyle of the Filipino
consumer.
1. __________________________
2. __________________________
3. __________________________
4. __________________________
5. __________________________
6.

WHAT’S NEW

https://int.search.myway.com
Task 3

The picture is an illustration of targeting potential market and a potential

market need. To identify your new potential markets, you consider every
target demographic that you currently sell, as well as those which are not

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yet targeted. Consider yourself as an entrepreneur and ask the following
questions. Write your answers on your activity notebook.

1. What other products do my customers need now?

2. What related products will they need in the future?
3. Who else could make use of the products I am selling now?
4. What demographic information do I have with my current customers?

WHAT IS IT

The Potential Market

1. Potential market is the part of the total population that has shown some
level of interest in buying a particular product or service. Potential market is
also called Total Addressable Market (TAM) (MBA Skool Team, 2018).

2. A potential market is the part of the market you can capture in the future.
It includes the demographic groups that are not currently your customers
but could become customers in the future (Lake, L, 2019).

3. Market potential is the total demand for a product in a given business

environment (Bhasin, H., 2018).

The Importance of Potential Markets (Lake, L., 2019)

Potential markets are an important part of a business's future growth.
Ensure the future of your business by identifying new customers. Think
proactively about ways for your business to grow and change. Show the
potential of your business to investors or collaborators. Increase your
revenue. Create a plan B that will weather changes in the economy or
market.

How to Identify Your Potential Markets (Lake, L., 2019)

Consider every target demographic that you currently sell to, as well
as those you have not yet targeted. Identify what they have in common with
each other, new milestones that they will encounter in their lives that will
impact their buying patterns, and where they overlap or diverge from your
current customers.
Ask yourself these questions to help you identify both new ways to
market your current products or services, as well as new products and
services that you can begin selling.

What other products do my customers need now?

What related products will they need in the future?
Who else could make use of the products I am selling now?

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 What demographic information does that new group have in common
with my current customers?

What demographic information does that new group have in common

with each other?

For example, a business that makes face masks and PPEs could identify
potential markets such as:

 Hospitals and other health related industries whose employees are

prone to COVID -19 virus and other viruses.

 Business industries and other organizations who want to ensure the

health condition of their employees.

 Employees and workers who need to report to work to earn income.

 Households who needs to go out for their necessities.

Note: Depending on the size and age of your company, as well as your
industry, you may have a clear picture of the potential markets that are
available.

Reaching Your Potential Market (Lake, L., 2019)

Once you've identified and chosen a potential market to begin
targeting, you will need new marketing strategies in place to communicate
with them. Use this profile to identify:

 The demographic information that people in a group have in common.

 The best forms of media to reach them.
 How they prefer to shop and make purchases.
 The concerns, struggles, or problems that you can help them
overcome.
 What values matter to them, both in everyday life and when shopping.
 The language that resonates with them.

Available Market
These are prospects who are willing and capable (have sufficient
resources) buyers, and have access to a particular market or service
(www.businessdictionary.com). It is defined as the number of people who are
both willing and capable of buying a particular product or service in a
particular market (MBA Skool Team, 2020).

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 Target Market
This refers to a group of potential customers to whom a company
wants to sell its products and services. Target markets are generally
categorized by age, location, income, and lifestyle. Defining a specific target
market allows a company to home in on specific market factors to reach and
connect with customers through sales and marketing efforts. (Kenton, W.,
2019).

Penetrated Market
This is a set of customers or clients who are already using a particular
product or service. A penetrated market means that the potential users of
a product or service are aware of it, and in many cases are active consumers
of it (www.businessdictionary.com).
The size of a potential market helps a company understand the level
of investment it should make further in the market, while taking into
consideration other factors. If the potential market is very small, it means
there is a very small fraction of the total population showing any interest in
the product or category. This means that it is better that the company
doesn’t invest further in the product or category because people won’t buy it.
If the size of the potential market is large, it means that there is a huge
fraction of the total population which is showing interest in the product, so
further investment can be made on the product development or modification,
marketing, promotions etc. The size of the potential market gives an
estimate of what all a company should do and how much it should invest
(MBA Skool Team, 2018).

The Market Need

1. Need
This refers to the motivating force that compels action for its
satisfaction. Needs range from basic survival needs (common to all human
beings) satisfied by necessities, to cultural, intellectual, and social needs
(varying from place to place and age group to age group) satisfied by
necessaries (www.businessdictionary.com).

The need is a driver of human action which marketers try to identify,

emphasize, and satisfy, and around which promotional efforts are organized
(www.businessdictionary.com).

2. Market
A market is a place where two parties can gather to facilitate the
exchange of goods and services. The parties involved are usually buyers and
sellers. The market may be physical like a retail outlet, where people meet

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face-to-face, or virtual like an online market, where there is no direct
physical contact between buyers and sellers (Kenton, W. & Boyle, M., 2020).

A market does not refer to a particular place but it refers to a market

for a commodity or commodities. It refers to an arrangement whereby
buyers and sellers come in close contact with each other directly or
indirectly to sell and buy goods (Shaikh, S., retrieved 2020).

A market is any place where sellers of particular goods or services can

meet with buyers of those goods and services. It creates the potential for a
transaction to take place. The buyers must have something they can offer in
exchange for the product to create a successful transaction (Moffatt, M.,
2019) Your market consists of (Stull, C., Myers, P.& Scott D.M. (2008) as
cited in: https://learn.marsdd.com/):

Existing customers: People who have already purchased your product.

Prospects: People who have not yet purchased your product but are
considering it.
Target market users: People in your target market who are not currently
looking for a solution.
Define the Market Need for Your New Business
Why is it important to clearly define market needs?

The market now demands that your business align to their needs. In
order to properly align your marketing efforts and your content, in particular
to what buyers need, you have to have a clear understanding of the many
intricacies, pains and pressures within your market. To achieve such
alignment, you need the ability to define market patterns, needs, interests,
preferences, etc. for a comprehensive view of the buying process is critical
(www.aberdeen.com).

Below are ways to define your market (Lancaster SCORE (2010):

 Consider whether the business offers a new solution to an old problem

or complements an emerging trend.
 Have a clear picture of your target market.
 Determine the benefits that your product or service offers.
 Examine industry data that can confirm whether there is a sustained,
growing demand for your product or service.
 Identify the percentage of market share that it is realistic for you to
capture.

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 WHAT’S MORE

Task 4

Copy and accomplish this on your notebook. Considering the ways to

define your market, evaluate the situations below using 1 to 5 rating scale, 5
as the highest and 1 as the lowest. Justify your answer in 1 to 2 sentences
only.

Situations Rating Justifications

To produce face masks and PPEs.
To open on-line business for fashion
accessories.
To open a massage center.
To open a computer shop.
To open a carinderia.

WHAT I HAVE LEARNED

Task 5

Direction: In your notebook, complete the following statements.

1. I have learned that

_____________________________________________________________________

2. I have realized that

_____________________________________________________________________

3. I will apply what I have learned

____________________________________________________________________

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 WHAT I CAN DO

Task 6

DIRECTIONS: In your municipality/locality, give at least five market needs

that you think relevant in supplying the basic needs and help improve the
lifestyle of your family and the rest of the residents.
1.
2.
3.
4.
5.

ASSESSMENT

Task 7

Direction: Read and analyze the statements below. Identify whether this
refers to potential market, available market, target market, or
penetrated market. Write your answer on your notebook.

_________1. They are described as active consumers of a product.

________ 2. They are people who are both willing and capable of buying a
particular product or service in a particular market.
_________3. It is the part of the total population that has shown some level
of interest in buying a particular product or service.
_________4. It includes specific customers to whom a company directs its
marketing efforts.
_________5. They are customers or clients who are already using a
particular product or service.

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MATCHING TYPE. Match the definitions in Column A with the
word/phrase in Column B. Write your answer on your notebook.

A B
1. It is a company’s marketing goals and Market
objectives combined into a single
comprehensive plan.
2. It refers to a person or organization Market size
that uses a commodity or service.
3. This is an area or arena in which Target market
commercial dealings are conducted.
4. This is used to give a general idea of Potential market
the size of a company in relation to its
market and its competitors.
5. This is one part of the total market for Need
a good or service.
6. It is also called Total Addressable Demographic group
Market (TAM).
7. A person or business that purchases Market strategy
a commodity or service.
8. Circumstances in which something is Customer
necessary, or that require some course
of action; necessity.
9. The study of the characteristics of Consumer
human populations, such as size,
growth, density, distribution, and vital
statistics.
10. The number of buyers and Market share
sellers in a particular market.

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 GLOSSARY

Potential market-Is the part of the total population that has shown some
level of interest in buying a particular product or service. Potential market is
also called Total addressable market (TAM) (MBA Skool Team, 2018).

Available Market-Are prospects who are willing and capable (have sufficient
resources) buyers, and have access to a particular market or service
(www.businessdictionary.com).

Target Market- This refers to a group of potential customers to whom a

company wants to sell its products and services. Target markets are
generally categorized by age, location, income, and lifestyle (Kenton, W.,
2019).

Penetrated Market-Is a set of customers or clients who are already using a

particular product or service (www.businessdictionary.com).

Need-Is a motivating force that compels action for its satisfaction. Needs
range from basic survival needs (common to all human beings) satisfied by
necessities, to cultural, intellectual, and social needs (varying from place to
place and age group to age group) satisfied by necessaries
(www.businessdictionary.com).

Market-Is a place where two parties can gather to facilitate the exchange of
goods and services (Kenton, W. & Boyle, M., 2020).

Existing customers-Are people who have already purchased your product.

Prospects-Are people who have not yet purchased your product but are
considering it.

Target market users-Are people in your target market who are not
currently looking for a solution.

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 REFERENCES

1. Bhasin, H. (2018). How to determine Market potential for any product or

service? Retrieved from: https://www.marketing91.com/determine-market
potential/

2. Definition of need. Retrieved from: http://www.businessdictionary.com/

definition/need.html

3. How to Define Market Needs to Align Content Effectively. Retrieved from:

https://www.aberdeen.com/cmo-essentials/define-market-needs-align
content-effectively/

4. Kenton, W. (2019). Target Market. Retrieved from:

https://www.investopedia.com/terms/t/target-market.asp

5. Lake, L., (2019). The definition and importance of potential markets.

Retrieved from: https://www.thebalancesmb.com/identifying-opportunity-
in-new- E-SITES REFERENCES

6. Available Market. Retrieved from: http://www.businessdictionary.com/

Websites
7. Learning Module for Entrepreneurship potential-markets-4043634.

8. Lancaster SCORE (2010). Define the Market Need for Your New Business.
Retrieved from: https://scorelancaster.wordpress.com/2010/01/18/define-
the market-need-for-your-new-business/

9. MBA Skool Team, (2020). Available Market. Retrieved from:

https://www.mbaskool.com/business-concepts/marketing-and-strategy
terms/11747-available-market.html

Penetrated Market. Retrieved from:http://www.businessdictionary.com/

definition/penetrated-market.html

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For inquiries or feedback, please write or call:

Department of Education – Schools Division of Negros Oriental

Kagawasan, Avenue, Daro, Dumaguete City, Negros Oriental

Tel #: (035) 225 2376 / 541 1117

Email Address: negros.oriental@deped.gov.ph
Website: lrmds.depednodis.net

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