Chapter 8 Analysing Markets and Marketing

Reasons For Market Analysis

Gathering evidence for devising new strategy:

• The firm will want to know how possible(feasible) a strategy could be such as an introduction of a new product.
• Data helps assist them in choosing the right strategy.
• Mistakes are very costly. 
• Use both primary and secondary data.
• Gathering data frequently to see current and future success. 

Identifying Significant Patterns In Sales:

• Seeing changes first = competitive advantage
•  To see changing patterns use qualitative and quantittative forecasting     methods

THE VALUE  OF MARKET ANALYSIS 

• helps to understand its market more better
• allows preparation for future

Sales forecasting helps to:

• measure performance in an individual department
• motivate staff through challenging targets 
• monitor achievements against targets to take action if needed

Helps to coordinate departments by:

• senior man. to see if strategy will be a success
• operations to produce to plan raw materials and capital etc
• HR to do workforce planning and training.
• finance to finalise cash flow and profit&loss.So that each department get funds.
• allows marketing to come up with strategies to hit sales targets. 

**test marketing**

The launching of a product in a geographical area in order to assess the marketing methods used.

Thus, if 5% of the region purchase the product, then 5% of the nation will purchase when introduced nationally. 

Benefits: accurate as they are based on actual purchases;increases popularity without the big expense of national launch. 

Drawbacks: copycat products; not launching it nationally could lead low profit; newness leads to people purchasing it once, exaggerates fake popularity; to make it succeed special offers used but cannot continue.