WELCOME To ALL OF YOU

1
WELCOME To ALL OF YOU (Market and Demand
Analysis)

• RAHUL JAIN
• (Striving for excellence)
• BCOM (H), PGPM, FCS

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Strategy formulation ...

• An organization must select any of
  innumerableways of seeking to attain its
  objectives.
• Strategies define how organizations shoulduse
  their resources to meet their objectives.
• Hence, strategies put constraints on
  employees to focus activities on what the
  organization does best or areas where it
  has an advantage over competitors.

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Mission Basic reason for existence

• Mission How do we intend to win in this
  business?
• Factors influencing Mission
• Stakeholders
• Internal resources and Power
• Values of top management
• Past development of firm
• Business definition
• Products
• Markets
• Function (Technology and Processes)

4
Vision- Yin Yang

• Core Ideology (Core values and Purposes)
• Envisioned Future (BHAG and vivid description)
• A vision, is more encompassing. It answers the
  question, "What will success look like?" It is
  the pursuit of this image of success that really
  motivates people to work together.

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Starbucks Mission and Vision

• Starbucks Mission
• Starbucks mission is to establish Starbucks as
  the premier purveyor of the finest coffee in the
  world while maintaining our uncompromising
  principles as we grow (Starbucks Website, 2006,
  p.1).
• Starbucks strategic plan to make its mission a
  reality is evidence by the companys rapid
  expansion worldwide. Starbucks has locations in
  all 50 States in the US, plus the District of
  Columbia and Puerto Rico (Starbucks Company Fact
  Sheet, 2006). Starbucks can also be found in 36
  countries outside the US (Starbucks Company fact
  Sheet, 2006). Starbucks is committed to buying
  only certified coffee in pursuit of selling the
  finest coffee.
• Starbucks Vision
• According to the companys profile, (2006) its
  vision is to make Starbucks coffee the most
  recognized and respected brand in the world by
  using high quality roast beans to make coffee
  beverages along with other products. The company
  wants to develop enthusiastically satisfied
  customers at all times. They want to make
  positive contributions to their communities and
  their environment.

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Need for Solid Market Research

• Size of market
• Competitor Analysis
• Market Conditions and trends
• Profit Margins
• Revenue Opportunities

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Economic Analysis

• National Income Data
• Industry Growth
• Impact of changes in Interest rate, inflation,
  taxes on Growth
• Other Key economic data

8
Market demand

• Market demand for a product is the total volume
  that would be bought by a defined consumer group
  in a defined geographical area in a defined time
  period in a defined marketing environment under a
  defined marketing program.
• It is not a fixed number but rather a function of
  stated conditions. Therefore it is called market
  demand function.

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Customer Analysis

• What type of customer will buy the product or
  service?
• Where are these customers located?
• How many potential customers (N) are there?
• How often do they consume or use it?
• What is the Competition?
• What are people paying?
• What is the Potential for the Market to Develop?
• What is my share of the Market?

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Market Potential

• Total Market Potential Number of buyers in the
  specific market under the given assumptions
  quantity purchased by an average buyer price of
  an average unit.

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Key Steps in Estimating Market Potential

• 1. Define your target market and market segments.
• 2. Define the geographic boundaries of your
  market.
• 3. Derive an average selling price.
• 4. Determine the average annual consumption.

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Company Sales Forecast

• The various ways of estimating demand are
• 1. Historical Sales figures
• 2. Forecasting current Demand by regression
  analysis, trend analysis
• 3. Estimating Industry growth
• 4. Estimating Economy's growth
•  

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Target Market

• A target market can be thought of as the
  customers who are most likely to buy from you and
  generally are described using demographic
  variables (gender, age, education) as well as
  psychographic variables (lifestyle and belief
  system variables).
• In many cases, a business may have more than one
  target market. Think about the automobile
  industry,
• Automobile manufactures have a number of target
  markets, i.e., truck buyers, luxury car buyers,
  economy buyers. Your business should be able to
  develop specific profiles for each of your target
  markets using demographic and psychographic
  variables.

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Revenue Analysis

• Revenues No. of expected buyerquantity
  purchased by an average buyerprice of an average
  unit
• Sales Budget