Market analysis requires an understanding of the 4 Cs which are consumer, conditions, competitor and the company. A study is undertaken to provide superior customer value, which is the main objective of the company. For providing better customer value, we should learn the needs of the consumer, the offering of the company, vis-a-vis its competitors and the environment which is economic, physical, technological, etc.
A consumer is anyone who engages himself in physical activities of evaluating, acquiring, using or disposing of goods and services.
A customer is one who actually purchases a product or service from a particular organization or a shop. A customer is always defined in terms of a specific product or company.
However, the term consumer is a broader term whichemphasises not only the actual buyer or customer, but also its users, i.e., consumers. Sometimes, a product is purchased by the head of the family and used by the whole family, i.e., a refrigerator or a car. There are some consumer behaviour roles which are played by different members of the family.
All the consumer behaviour roles are to be kept in mind but, the emphasis is on the buyer whose role is overt and visible.
(a) The consumer. To understand the consumer; researches are made. Sometimes motivational research becomes handy to bring our hidden attitudes, uncover emotions and feelings. Many firms send questionnaires to customers to ask about their satisfaction, future needs and ideas for a new product. On the basis of the answers received, changes in the marketing mix is made and advertising is also streamlined.
(b) The external analysis (company). The external analysis may be done by the feedbacks from the industry analyst and by marketing researches. The internal analysis is made by the firm’s financial conditions, the quantum of the sales force and other factors within the company.The study of these factors leads to a better understanding of the consumer and his needs.
Characteristic features of Indian consumer
(c) The competition. In the analysis of the market, a study of the strengths and weaknesses of the competitors, their strategies, their anticipated moves and their reaction to the companies’ moves and plans is to be made. The company after getting this information,reacts accordingly and changes its marketing mix and the offering is made in a manner which can outdo the competitor. This is a very difficult process and it is easier said than done. To have correct information about the competitors and to anticipate their further moves is the job of the researcher.
(d) The conditions. The conditions under which the firms are operating has also to be seriously considered. The factors to be studied are the economy, the physical environment, the government regulations, the technological developments, etc. These effect the consumer needs, i.e., the deterioration of the environment and its pollution may lead to the use and innovation of safer products. People are health conscious and are concerned with their safety. Hence, in this case, safer products have a better chance with the consumer. In case of recession, the flow
of money is restricted greatly. This leads to the formulation of different marketing strategies.
(e) Market segmentation. The market is divided into segments which are a portion of a larger market whose needs are similar and, they are homogeneous in themselves. Such segments are identified with similar needs.
(f )Need set. By need set, it is meant that there are products which satisfy more than one need. An automobile can fill the transportation needs, status needs, fun needs or timesaving needs. So, the company tries to identify the need sets, which its product can fulfil. Then we try to identify the groups who have similar needs, i.e., some people need economical cars, others may go for luxury cars.
(g) Demographic and psychographic characteristics. These groups are identified and they are described in terms of their demographic and psychographic characteristics. The company finds out how and when the product is purchased and consumed.
(h) Target segment. After all, the above preliminary work is done, the target customer group known as the target segment, is chosen, keeping in mind how the company can provide superior customer value at a profit. The segment which can best be served with the company’s capabilities at a profit is chosen. It has to be kept in mind that different target segments require different marketing strategies and, with the change in the environmental conditions the market mix has to be adjusted accordingly.
Attractiveness of the segment can be calculated by marking the various criteria on a 1 to 10 scale as given below:
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