You are on page 1of 20

The Market Demand

Dr. Amr Fouad

PDF created with pdfFactory Pro trial version www.pdffactory.com

The job of analyzing the marketplace


Market segmentation Customer analysis Market demand measurement & forecasting

PDF created with pdfFactory Pro trial version www.pdffactory.com

The Demand ()

PDF created with pdfFactory Pro trial version www.pdffactory.com


Demand Effect Negative No Demand Latent Falling Irregular Full Overfull Unwholesome Meaning Against it Indifferent Available is unsatisfactory Such as in HC Vaccination, Psychiatry Blood Donation Screening Programs Cancer, aging, birth control Marketing Task Analysis Positive Promotions Find ways to connect (benefit) with market Measure size of potential market Remarketing (creative) OR Stop service Alter time pattern: pricing - pro. - access Maintenance Demarketing ($access, $ pro#price) [selective] Anti-product campaign [De-marketing]

Any service at any hospital at any time Time Variation Satisfied acc. to capacity Higher than capacity Unpleasant, harmful Emergency (night, WE) Pediatricians (school y.) Any service ERs, OP clinics or PCP in insurance policy Smoking, drugs, alcohol etc

PDF created with pdfFactory Pro trial version www.pdffactory.com

Defining the markets

PDF created with pdfFactory Pro trial version www.pdffactory.com

Explanatory Story

The Wedding Party !

PDF created with pdfFactory Pro trial version www.pdffactory.com

Imagine you're going to a wedding party with the intention of seeking a beautiful woman for marriage using the privilege of your being rich and youre trying to show it in all useful means

PDF created with pdfFactory Pro trial version www.pdffactory.com

Interpretation
Party The Party Men & Women in the Party Women in the Party The Marriage Being Rich Useful Means Business The Marketplace The Population The Market The Service (Product) Competitive Edge Marketing Mix

PDF created with pdfFactory Pro trial version www.pdffactory.com

Interpretation (cont)
Party Women in the Party Single women Single women seeking marriage Single beautiful women seeking marriage The 3 women you get introduced to The 1 you will propose to
PDF created with pdfFactory Pro trial version www.pdffactory.com

Business Market Potential Market Available Market Available Qualified Market Served Market Penetrated Market

Total population

100%

Potential market

100%

40%
Available market Qualified available market Served market

20% 10% 5%

Potential market

10%

Penetrated market

Levels of market Definition

PDF created with pdfFactory Pro trial version www.pdffactory.com

Potential Market

Available Market Qualified Available Market Served Market

Penetrated market

PDF created with pdfFactory Pro trial version www.pdffactory.com

The potential market


is the set of consumers who profess some level of interest in a defined market offer.

The available market


is the set of consumers who have interest, income or health insurance coverage, where necessary, and access to a particular market offer.

PDF created with pdfFactory Pro trial version www.pdffactory.com

The qualified available market


is the set of consumers who have interest, income or health care coverage, where necessary, access and qualification for the particular market offer.

The served market


is the part of the qualified available market the organization puts effort into attracting and serving.

The penetrated market


is the set of consumers who are actually Consuming the product.
PDF created with pdfFactory Pro trial version www.pdffactory.com

Market demand measurement & forecasting


Total Market Demand Area Market Demand Total Market Sales Forecasting Future Demand

PDF created with pdfFactory Pro trial version www.pdffactory.com

Area Market Demand


The Market demand for a product may vary geographically. So the organization must decide where to focus its marketing effort
4 METHODS: q Area Analysis of Current Sales q Single-factor and multiple-factor indicators q Supply factor indicators q Distance-adjusted index

PDF created with pdfFactory Pro trial version www.pdffactory.com

Area Analysis of Current Sales


Study where your current patients (sales volume) are coming from (dot-map) o Very Common o Misleading

Single-factor and multiple-factor indicators


o >55 ICU Social class Annual Income Urban residence (single) Dental services (multiple)

o Inpatient demand vs. Ambulatory demand


PDF created with pdfFactory Pro trial version www.pdffactory.com

Supply factor indicators


Remember the Golden Rule of supply & demand that exists in every business except HEALTHCARE It could be even TWISTED & REVERSED

Ford More Cars with the same price Demand does not change

Hospital More physicians, Equipments & beds Demand increase

PDF created with pdfFactory Pro trial version www.pdffactory.com

Distance-adjusted index
Market attractiveness falls off with the square of the distance of the market from the location of the service. Travel much farther to see a specialist.
Market Attractiveness

Square Distance

+ve relationship with market size -ve relationship with market location

PDF created with pdfFactory Pro trial version www.pdffactory.com

Forecasting Future Demand

The factors affecting demand:


(1) Non-controllable Macro Environment Factors such as the state of the economy, new technologies, and new reimbursement policies (2) Competitive Factors such as competitors new facilities, new services, and promotional expenditures; (3) organizational factors such as the organizations facilities, new services, and promotional expenditures.

PDF created with pdfFactory Pro trial version www.pdffactory.com

Forecasting Future Demand


A forecast can be based on what people say, what people do, or what people have done. What people say encompasses two methods (1) buyer intention survey (2) middleman estimates. What people do involves (3) market testing. What people have done involves (4) time-series analysis (5) statistical demand analysis.

PDF created with pdfFactory Pro trial version www.pdffactory.com