Welcome to class ofassessing and analyzing markets

byDr. Satyendra Singh

University of WinnipegCanada

Learning Objectives

Assessing and Analyzing Marketd Initial Screening Economic and financial screening Political and legal screening Sociocultural screening Competitive screening Challenges in screening Final selection of markets

Objectives:

Assessing and Analyzing Markets

• Market Screening A version of environmental scanning in which the firm

identifies desirable markets by using the environmental forces to eliminate the less desirable markets

Environmental Scanning A procedure in which a firm scans the world for changes in

the environmental forces that might affect it

Market Screening

Permits management to identify a small number of desirable by eliminating those judged to be less attractive

Market Screening

Two Types of Screening

Country Screening Using countries as the basis for market selection

Segment Screening Using market segments as the basis for market selection

Initial Screening…

• Basic Need Potential

If the need is lacking, then no reasonable expenditure of effort and money will enable the firm to market its goods and services

Easier for producers of specialized industrial materials or equipment than for widely consumed products

Initial Screening

Resources to establish need potential Market size (present and potential) Imports do not fully measure market potential Review reports by various embassies Department of foreign and international trade

Second Screening: Economic and Financial Forces

Measures of market demand based on economic and financial data Market indicators

Market factors

Trend analysis

Cluster analysis

Market Indicators

Market Indicators Economic data used to measure relative market

strengths of countries or geographic areas

Possibilities: Market size

Market growth rate

E-commerce readiness

Market Factors

Market Factors

Economic data that correlate highly with market demand for a product

Estimation by analogy

Trend Analysis

Trend Analysis

Statistical technique by which successive observations of a variable at regular time intervals are analyzed to establish regular patterns that are used for establishing future values

Cluster Analysis

Cluster analysis

Statistical technique that divides objects into groups so that the objects within each group are similar

Third Screening: Political and Legal Forces

Entry Barriers Import restrictions, local participation requirements,

local content restrictions, government-owned competition

Profit Remittance Barriers Undue restrictions on repatriation of earnings, limits

to FDI, inability to provide foreign exchange

Policy Stability Political climate, government stability, public unrest

Fourth Screening:Sociocultural Forces

Screening on the basis of sociocultural factors is challenging

Sociocultural factors are fairly subjective

Data are difficult to assemble, particularly from a distance

Fifth Screening: Competitive Forces…

The number, size, and financial strength of the competitors

Their market shares

Their marketing strategies

The apparent effectiveness of their promotional programs

The quality levels of their product lines

Fifth Screening: Competitive Forces

The source of their products--imported or locally produced

Their pricing policies

The levels of their after-sales service

Their distribution channels

Their coverage of the market

Final Selection of New Markets…

Personal visit to potential markets is essential

Field Trip, unhurried

Government-Sponsored Trade Missions

Trade Fairs

Final Selection of New Markets

Research in Local Market

Face-to-face interviews reveal information that would never be written

Hire local research group Person in charge of the project must have experience in that country or

culturally similar one in same geographic area

Local Research Problems

Cultural Language Literacy Social desirability bias

Technical No up-to-date maps Streets have different names Houses not numbered Only wealthy have telephones Mail delivery issues

Research in Developing Nations

• Less research performed

• Often a seller’s market• Competition is frequently less intense in developing

nations because• fewer competitors• management struggling with problems other than marketing

Finally• Segment Screening

– Definable: identify and measure– Large: to be worth the effort needed – Accessible: for promotion and distribution– Actionable: have control of marketing programs – Capturable: potential exists