Market Assessment is the evaluation of the market for a product or service. It includes the analysis of market trends, assessing the competition, and conducting market studies. It is an evaluation of the market for a company’s goods and services e.g. an entrepreneur might be interested in the characteristics of buyers who are purchasing the products of the firm or a comparison of its products with those offered by competitors.
Market Assessment – Meaning, Techniques, Significance
Meaning of Market Assessment:
Market assessment studies the attractiveness and dynamics of a special market within a special industry. It is part of the industry analysis. It helps to analysis. It helps to analyze the opportunities, strengths, weaknesses, and threats of an enterprise. Market assessment is also known as a documented investigation of a market that is used to inform the planning activities of an entrepreneur.
Market assessment is the process of systematic gathering, recording and analyzing of information about customers, competitors, and the market. Market assessment can help to create a business plan, launch a new product or service, and fine-tune the existing products and services, expansion into new markets. The objective of the market assessment is to assist the entrepreneur to make better entrepreneurial decisions about the development and marketing of new products.
TECHNIQUES IN ASSESSING MARKET/TECHNIQUES IN FORECASTING DEMAND:
There are a number of techniques available for forecasting/assessing the Demand/market. These are:
1 Survey Method: The most widely used method for estimating future demand of a product is based on the collection of data from the potential customers, dealers, and people with expert knowledge about the subject is survey method of assessing the market. Under this method, a small number of customers, dealers or knowledgeable persons are surveyed and required information is sought from all of them for the upcoming product. In case the number of respondents to be surveyed is very large and all can’t be surveyed. Then in that type of situation, only the representative’s number is surveyed or interviewed to collect the relevant information. The second technique so adopted is called ‘Sample Survey’ method.
2 Statistical Method: In this method of market assessment, some tools and techniques of statistics are employed to estimate the demand for the upcoming product, such as ‘Time Series Analysis’ or ‘Regression Analysis’. Time series is used where historical data on demand for the product is available to forecast the Future Trend. The Regression Analysis is used to when there is a definite relation between the relevant variable affecting the Income and Demand so established.
3 Leading Indicator Method: This method is based on the fact that some indicators as available or observed move Up or Down ahead of others. By such observation, the event which will follow movements is predicted or may be predicted.
The significance of Market Assessment:
1 Decision-Making Technique. Market assessment is a useful tool for taking marketing entrepreneurial decisions. It offers necessary information and data is analyzed and processed forms for making entrepreneurial decisions
2 Business Planning. Market assessment is used for entrepreneurial planning. It deals with entrepreneurial opportunities i.e. those opportunities which are viable to be exploited by an entrepreneur. Marketing assessment can access the resources that will be useful for the entrepreneur. Assessment of uncontrollable factors such as economic purchasing power of buyers, political peace, legal limitations and other factors help in deciding the appropriate planning for an entrepreneur.
3 Problem Solving. Starting from problem identification to the formulation of the alternative solution, and evaluating the alternatives in every area of marketing management is the problem-solving action of marketing assessment. It can help entrepreneurs bring about prompt adjustment and innovations in the product, price, place, and promotion.
4 Control Technique. Marketing assessment is used as a control technique to find out the weaknesses and shortcomings of the entrepreneurial decisions to reorient the planning and performance techniques. Control-oriented marketing assessment helps the entrepreneur to isolate the trouble spots and to keep abreast of current techniques. Marketing assessment measures the effectiveness of the entrepreneur’s plans and performance.
5 Large Scale Production. Marketing assessment helps in producing the goods at a large scale level by providing suitable decisions to be undertaken by entrepreneurs. It helps to exploit the existing production resources to meet the growing markets. Marketing assessment provides the means and methods to match the production lines with new business opportunities.
6 The pattern of Consumption. An entrepreneur can easily study the pattern of consumption through marketing assessment. The study of buyers’ attitudes and capacity to purchase is very significant in marketing assessment.
7 Marketing Strategy. Marketing assessment has to lay down appropriate marketing strategies to meet competition to pursue growth in the market and to achieve entrepreneurial objectives.