Entrepreneurship: Recognizing Potential Market PDF

ENTREPRENEURSHIP Recognizing Potential Market Ms. Carmella Keyse A. Posadas Learning Objectives Recognize a potential market Analyze the market need Determine the possible product/s or service/s that will meet the market need Screen the proposed solution/s based on viability,...

ENTREPRENEURSHIP Recognizing Potential Market Ms. Carmella Keyse A. Posadas Learning Objectives Recognize a potential market Analyze the market need Determine the possible product/s or service/s that will meet the market need Screen the proposed solution/s based on viability, profitability, and customer requirements Show inquisitive and probing mind in doing exercises and activities Give one job opportunities for entrepreneurship as a career. Give one pros and cons of being an employee. Give one pros and ENTREPRENEURSHIP Recognizing Potential Market Ms. Carmella Keyse A. Posadas What product/service you could offer to this market? What product/service you could offer to this market? What product/service you could offer to this market? What product/service you could offer to this market? What product/service you could offer to this market? ENTREPRENEURSHIP Recognizing Potential Market Ms. Carmella Keyse A. Posadas The Potential Market 1. Potential market is the part of the total population that has shown some level of interest in buying a particular product or service. Potential market is also called Total addressable market (TAM).market is the part of the market you can capture in 2. A potential the future. It includes the demographic groups that are not currently your customers but could become customers in the future. 3. Market potential is the total demand for a product in a given business environment. The Importance of Potential Markets Potential markets are an important part of a business's future growth. Ensure the future of your business by identifying new customers. Think proactively about ways for your business to grow and change. Show the potential of your business to investors or collaborators. Increase your revenue. Create a plan B that will weather changes in the economy or market.  How to Identify Your Potential Markets Consider every target demographic that you currently sell to, as well as those you have not yet targeted. Identify what they have in common with each other, new milestones that they will encounter in their lives that will impact their buying patterns. Where they overlap or diverge from your Ask yourself these questions to help you identify both new ways to market your current products or services, as well as new products and services that you can begin selling: What other products do my customers need now? What related products will they need in the future? Who else could make use of the products I am selling now? What demographic information does that new group have in common with my current customers? What demographic information does that new group have in common with each other?  For example, a business that makes face masks and PPEs could identify potential markets such as: Hospitals and other health related industries whose employees are prone to COVID -19 virus and other viruses. Business industries and other organizations who want to ensure the health condition of their employees. Employees and workers who need to report to work to earn income. Households who needs to go out for their necessities. Note: Depending on the size and age of your company, as well as your industry, you may have a clear picture of the potential markets that are available.  Reaching Your Potential Market Once you've identified and chosen a potential market to begin targeting, you will need new marketing strategies in place to communicate with them. Use this profile to identify: The demographic information that people in a group have in common. The best forms of media to reach them. How they prefer to shop and make purchases. The concerns, struggles, or problems that you can help them overcome. What values matter to them, both in everyday life and when shopping. The language that resonates with them. The figure below depicts what is a potential market with respect to the total population and how it can be converted to a penetrated market: Available Market Prospects who are willing and capable (have sufficient resources) buyers, and have access to a particular market or service. Defined as the number of people who are both willing and capable of buying a particular product or service in a particular market. Target Market Refers to a group of potential customers to whom a company wants to sell its products and services. Target markets are generally categorized by age, location, income, and lifestyle. Defining a specific target market allows a company to home in on specific market factors to reach and connect with customers through sales and marketing efforts. Penetrated Market A set of customers or clients who are already using a particular product or service. A penetrated market means that the potential users of a product or service are aware of it, and in many cases are active consumers of it. The size of a potential market helps a company understand the level of investment it should make further in the market, while taking into consideration other factors. The Market Need 1. Need A motivating force that compels action for its satisfaction. Needs range from basic survival needs (common to all human beings) satisfied by necessities, to cultural, intellectual, and social needs (varying from place to place and age group to age group) satisfied by necessaries. A driver of human action which marketers try to identify, emphasize, and satisfy, and around which 2. Market A Market is a place where two parties can gather to facilitate the exchange of goods and services. The parties involved are usually buyers and sellers. The market may be physical like a retail outlet, where people meet face-to-face, or virtual like an online market, where there is no direct physical contact between buyers and sellers. The Market Need A market need refers to the demand or requirement for a product or service within a specific market. Your market consists of: Existing Prospects: Target market customers: users: People who have People who have People in your already purchased not yet purchased target market who your product. your product but are not currently are considering it. looking for a solution. Define the Market Need for Your New Business Why is it important to clearly define market needs? The market now demands that your business align to their needs. In order to properly align your marketing efforts ‒ and your content, in particular ‒ to what buyers need, you have to have a clear understanding of the many intricacies, pains and pressures within your market. To achieve such alignment, the ability to define market patterns, needs, interests preferences, etc. for a comprehensive view of the buying process is critical. Below are ways to define your market: Consider whether the business offers a new solution to an old problem or complements an emerging trend. Have a clear picture of your target market. Determine the benefits that your product or service offers. Examine industry data that can confirm whether there is a sustained, growing demand for your product or service. Identify the percentage of market share that it is realistic for you to capture. Consider how realistic your pricing is.  Concepts about Product and Service A product can be defined as anything that we can offer to a market for attention, acquisition, use or consumption that could satisfy a need or want. However, the definition of product does not only involve tangible goods such as a car, a fridge or a phone. The definition is extended to include intangible objects as well, because they can be offered to a market. Therefore, the broad definition of product includes services, events, persons, places, organizations or even ideas. Services are special form of product which consists of activities, benefits or satisfactions offered for sale that are intangible and do not result in the ownership of anything. A service can thus include banking, airline travel, communication services, hotel services and so on. A product is a tangible item that is put on the market for acquisition, attention, or consumption, while a service is an intangible item, which arises from the output of one or more individuals.  Examples: 1. When a consumer buys a car, the product comes with a lot of other service responsibilities, such as tune-up and maintenance. 2. A laptop buyer now buys a bundle of service benefits in addition to the tangible components of the laptop.  Specific Examples of products and services Products new prints of motion picture film elements prints for exhibit purposes reference copies on DVD/CDs, books, magazines for the reading rooms or other clients Cars, tables and chairs, etc. Specific Examples of products and services Services consulting with clients on appropriate products for specific purposes providing advice on risk assessment and priority setting working on standards committees conducting training and other educational outreach  The Difference of Product and Service PRODUCT SERVICE 1. It is tangible. It is intangible 2. Quality standards can be It is very difficult to attain quality attained. standards 3. It may be an asset sometimes,. It involves expenditure without any e.g., fridge, television set, etc. tangible return benefit. Physical possession is not 4. Physical possession is possible. possible 5. It can be stored. It cannot be stored. 6. It can be transported. It cannot be transported. 7. The producer and the seller may The producer of service is the seller be different persons. too, e.g., medical and legal services. 8. Assembling is very important. Assembling has no relevance at all Skill of the service provider is the 9. Skill of the seller alone cannot deciding factor in most cases, e.g., determine sale. legal, catering and medical services. 10. Production and distribution need service will have to be done not take place simultaneously. simultaneously, e.g., provision of l t i it 11. Packing plays a crucial role It has no relevance in the in the marketing of any product. marketing of service. name are important in the important in the marketing of 13. Labelling k ti f is an integral d t part of i marketing. It is required as per It has no relevance. law  Identifying and Meeting Customer Needs Customer needs are the named and unnamed needs of customers when they come in contact with the different business establishments or when they search for the solutions which businesses provide. Superior customer service means meeting customers’ needs by providing them with the products and services they want or by providing effective solutions to their problems. Innovation comes from identifying customers’ needs and providing solutions that meet those needs.  Why “Identifying Customer Needs” Matters 1. It is essential for ensuring customer satisfaction and loyalty. 2. Customers have unique needs. 3. Often, customers either aren’t clear about what they need or they don’t really know what they want. 4. Identifying clients’ needs creates satisfied customers.  How to Meet the Needs of Customers You can follow a simple, four-step procedure to meet the needs of customers. Class activity: As a would-be Entrepreneur, you are tasked to identify your dream business, one that involves your interests. Indicate who are your potential market, target market, available market and/or penetrated market. Write your answer in a manila paper. Assign two presenters to discuss your work. Class activity: Each group will brainstorm potential markets for your product/service. You should consider various factors like target demographics, geographic locations, market trends, and potential competitors. Each group will select one potential market you believe is the best fit for your product/service. You should justify your choice based on the factors discussed. Each group will present their chosen market and their rationale to the class. Presentations should be 2-3 minutes long. Class activity: Understanding of market identification factors (5 points) Quality and relevance of presentation (5 points) Clarity and persuasiveness of presentation (5 points) Participation and teamwork (5 points)  ASSIGNMENT DIRECTIONS: Give the meaning of the following word/phrase in each item. Write your answer in the space provided. 1. Customer vs. consumer ___________________________________ 2. Demographic group ______________________________________ 3. Market share ___________________________________________ 4. Market size ___________________________________________ 5. Marketing strategies_______________________________________  House Rules during Exams: 1. Keep your notes away. 2. Only your pen should be on your desks. 3. Avoid Erasures. 4. Stay silent. 5. Come to me if you have questions. 6. Focus on your own paper. 7. No unnecessary movements. 8. No smartwatches allowed.