Module 4

Developing a Business Plan:

Identifying the Market Need
 Market Needs
• Knowing the needs, wants, and interests of the customer should be
the first step for businesses. Selling what people need and want is
simpler than trying to sell them something they cannot see the value
in. Being ability to watch the market and identify potential sources of
a successful new business should be a competitive advantage in
today's fast-paced world. Market needs inform businesses about the
types of products to create, who the target market is, how much they
should charge, and which distribution channels to use. This reduces
the uncertainty that comes with the development of new goods and
services.
• A primary priority should be giving thought to your marketing
strategy. Finding the broadest prospective market for your goods or
services should be the main focus of your marketing strategy. There
are smaller segments within that group, and you may choose to
execute particular marketing campaigns for them since they have
different demands.
 Size of Market

 This is the demographic most likely to purchase your

good or service. You want to locate a sizable pool of
buyers, unless you are in a very specific niche. For
instance, let's say you want to build a bakery with
3,000 people of various ages as your target market.
Understand Your Customer Profile

 You must comprehend who your ideal client is in

order to calculate the size. For instance, take the
example of your bakery, where a customer enjoys
eating hot pandesal and freshly baked bread.
 Personal Similarities in Market
When you look at the personal lives of folks who are
in the group you are targeting, you will frequently
find commonalities. Included in this are marital
status, educational attainment, professional path,
family size, and income levels. As for the bakery
example, most of the customers are similar in that
people in their 50s to 70s like to purchase breads
with a flat flavor as opposed to teens who prefer
breads with flavor.
 Consider Cultural Components

 A marketing plan should consider the

geographic and cultural elements of
your target group. These could have a
significant difference on how what the
buyers want to buy or even how they
buy it.
 Special Interests or Needs
 With the growth of social media and digital
marketing, marketing strategies have grown more
dynamic. Based on extremely detailed facts, you can
determine the size of your market as a business
owner. In essence, market segmentation enables
you to create advertising campaigns that target
particular consumers. For instance, you probably
don't want to market to cat owners if you run a pet
business that serves parrot owners.
Market Research
 is essential when introducing a
new product, trying to enhance an
existing service, or simply trying
to stay one step ahead of your
competitors. It will give you all the
data you require to make the best
possible business decisions.
There are 5 things that market research can do for you in the process of
product development & business growth:

1. It is crucial for a better understanding of your customers

Market research will help you map out the full profile of your ideal
customer. Knowledge of your customers will help you determine the market
size and what triggers them to buy. You’ll gain valuable insights like their
age, location, gender & income, which will help you in creating effectively
tailored marketing and pricing campaigns.

2. Knowledge about your competitors, and how they approach the market

Market research will help assess the market to identify both key players
and those on the rise. Furthermore, it will help you find the weaknesses in
your competitor’s approach. These are gaps that you can utilize to gain
more customers. You can also learn what performed the best for the
competition. In turn, you will be able to think more creatively while
modeling your new strategy.
3. Testing your product before launch

Testing is a very important part of learning what works before jumping

into the business world. Every business decision should be tested before
fully exposing to your target audience. By market testing your idea or
product, you will save yourself from additional expenses and most
importantly, from delivering a bad product to the marketplace. You can
never be 100% sure that your product will instantly connect with your
potential customer. With market research, you’ll find out what approach
you should take when marketing the product. You’ll also find the key
message that resonates with clients.

4. You won’t go out of business

“It is not the strongest or the most intelligent who will survive but those
who can best manage change.” — Charles Darwin

So, in order to remain in business and stay relevant, you should not
only anticipate change, but you need to be able to predict change too.
That’s how good your market research needs to be!
5. Business Growth

Market research helps you comprehend the

demands of your customers, detect more business
opportunities, plan the perfect marketing campaign,
minimize losses, and keep track of the competition.
It allows organizations to classify their objectives
while following the current trends and take
advantage by reaching out to their target audience.
Identifying problems before they happen is crucial if
you want to grow. Effective market research will not
only help you predict some of the pitfalls that can
occur but also it will save you a lot of money too.
Your solution may look like a proper market fit, but
if it’s not the case, you’re in big trouble.
The process of market research itself is designed to reduce the risk
and to make the marketing strategy cost-effective for your business.

Choosing a Product or Service to Sell.

To succeed as an entrepreneur, you must develop the ability to select

and offer the right products or services to your customers in a
competitive market. More than any other factor, your ability to make
this choice will determine your success or failure. There are thousands
of products and services available to consumers today. And there are
unlimited opportunities for you to enter the marketplace and compete
effectively with a new product or service that's better in some way than
what's already being offered by your competitors. Remember, your
skill at choosing that product or service is critical to your success. The
most important thing you can do before deciding what to sell is to
think. And the more you think about a product or service before you
bring it to market, the better your decisions will be. So how do you
start? To make a product successful, you must be personally and
emotionally committed to its success. Once you've got a product or
service in mind, you need to begin with a self-analysis.
How to Make Sure There's a Market for Your Business Idea

1. Accept the market as a harsh, but fair judge. If you're in

business, you simply need to embrace the reality that the
market will ultimately dictate your success. That means you
have to make sure the numbers support your idea.
2. Pick proven categories, then find your niche. Broad proven
categories typically offer greater opportunities than hot new
markets.
3. Focus on wallet share, not market share. Think about how you
can retain your customers for repeat business so you can get
an exponential return on your initial advertising or marketing
investment.
4. Put your ideas to the test. Better to pay the price in terms of
time and effort now in order to learn what you don't know
about your market and buyer. The response you get will tell
you what buyers in your market want, need and desire. You can
then use that information to enhance your offering or to
discover a more profitable market and business than you
initially conceived.