Market/Submarket Analysis

1. Chapter Four Market/Submarket Analysis

2. Dimensions of a Market Analysis • Emerging submarkets • Actual and potential market and submarket size • Market and submarket growth • Market and submarket profitability • Cost structure • Distribution systems • Trends and developments • Key success factors

3. Start with the Whole Market • How big? How to identify? 2012: 84.1 MM 2011: 80.0 MM 2010: 77.9 MM 2009: 61.8 MM 2008: 70.5 MM 2007: 73.3 MM

4. Customer Decision Process Brand Relevance Brand Preference Select Product Category or Subcategory Determine Brands to Consider Select Brand to Buy • SUV • Lexus • BMW • Mercedes • Mercedes

5. Questions to Help Structure a Market Analysis • Submarkets Are augmented products, emerging niches, new applications, repositioned product classes, customer trends, or new technologies creating worthwhile submarkets?

6. Questions to Help Structure a Market Analysis • Submarkets

7. Questions to Help Structure a Market Analysis • Submarkets

8. Questions to Help Structure a Market Analysis • Submarkets

9. Questions to Help Structure a Market Analysis • Submarkets

10. Questions to Help Structure a Market Analysis • Submarkets

11. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

12. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

13. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

14. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

15. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

16. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

17. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

18. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

19. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

20. Chapter 4 - Market and Submarket Analysis

21. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

22. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

23. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

24. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

25. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

26. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

27. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

28. Questions to Help Structure a Market Analysis • Size and Growth Potentially important submarkets? Size and growth characteristics? Submarkets declining? How fast? Driving forces behind the trends?

29. Chapter Four Market/Submarket Analysis Part Two

30. Questions to Help Structure a Market Analysis • Potential Market—the user gap • Cereal (US vs. Europe) • Personal computers

31. Questions to Help Structure a Market Analysis • Ghost Potential • China (almost all categories) • HD • DVR

32. Questions to Help Structure a Market Analysis • Is it big enough for ME? • Small can be beautiful (for a smaller firm).

33. Questions to Help Structure a Market Analysis • How fast will a new market grow? • Use history PLUS indicators

34. Questions to Help Structure a Market Analysis • Where are we in the market life cycle?

36. Questions to Help Structure a Market Analysis • Profitability • How intense is the competition among existing firms? • Threats from potential entrants and substitute products? • Bargaining power of suppliers and customers?

37. Questions to Help Structure a Market Analysis • Cost Structure Major cost and value-added components for various types of competitors? We will do an exercise on this in class!

38. Questions to Help Structure a Market Analysis • Distribution Systems Alternative channels of distribution? How are they changing?

39. Questions to Help Structure a Market Analysis • Market Trends—correctly assessing trends is very important. • Missing important trends can be disastrous, and is often when industry power shifts.

40. Questions to Help Structure a Market Analysis • Examples of missed trends • "Pepsi-Cola hits the spot / Twelve full ounces, that's a lot / Twice as much for a nickel, too / Pepsi-Cola is the drink for you"

41. Questions to Help Structure a Market Analysis • Examples of missed trends • "Pepsi-Cola hits the spot / Twelve full ounces, that's a lot / Twice as much for a nickel, too / Pepsi-Cola is the drink for you"

42. Questions to Help Structure a Market Analysis • Examples of missed trends

43. Questions to Help Structure a Market Analysis • Examples of missed trends

44. Chapter 4 - Market and Submarket Analysis

45. Chapter 4 - Market and Submarket Analysis

46. Questions to Help Structure a Market Analysis • Examples of missed trends

47. Questions to Help Structure a Market Analysis • Examples of missed trends

48. Questions to Help Structure a Market Analysis • Examples of missed trends

49. Questions to Help Structure a Market Analysis • Examples of missed trends

50. Questions to Help Structure a Market Analysis • Examples of missed trends