Inexperienced business operators go into new markets without having the information they need to be successful.
Because they don’t know the answers to the 6 Essential Questions That Every Businessperson Must Ask, they often fail. The difference between success and failure is rarely one wrong decision. Instead, it is a series of wrong decisions made by people who do not have the essential information needed to make the right ones.
You can greatly increase your chances of making the right decisions IF you know the answer to these 6 questions:
(1) What is the demand for your product or service?
When you know how many Internet searches are made every day, week, month, and year for your product or service, you can estimate how much demand there is for what you are selling. More demand = increased chances of success.
(2) What is the available supply of your product or service?
When you know how many businesses are already selling your product or service you can accurately estimate whether or not there is room in the market for your offering.
(3) Who are your Competitors?
It’s not enough to simply know what the supply (number of competitors) is, it’s also essential that you know who your competitors are. For example, can you see the benefit of knowing you’re considering entering a market owned by Fortune 500 companies that spend millions of dollars per year on advertising alone? What if you found out that your biggest potential competitor is a non-profit that gives away your product or service for free?
(4)What is the best pricing model for your product or service?
Determining price elasticity is a critical component of any new product or service launch. When you know the highest and lowest available prices for your product or service, you are in a better position to determine a price that will spur sales and generate a fair profit.
(5) How are your competitors promoting?
What competitors say in their advertising and marketing campaigns can provide you with critical insight into their product or service offerings. When you know what words and phrases they are targeting for Pay-Per-Click ads and where they are spending other advertising money, you are in a better position to meet them head-on in the territories they are already defending and to discover new territories that have escaped their attention.
(6) What is the market “buzz” for your product or service?
Successful companies like Amazon, CompUSA, Dell, and even Microsoft would never launch a new product or service without conducting a thorough online market analysis and neither should you.
A market analysis report helps you to identify the niche markets that are ripe for your product or service. You can greatly increase your chances of success if you target the right people at the right time.