Welcome to class of assessing and analyzing markets by Dr. Satyendra Singh University of Winnipeg Canada

Learning Objectives  Assessing and Analyzing Marketd  Initial Screening  Economic and financial screening  Political and legal screening  Sociocultural screening  Competitive screening  Challenges in screening  Final selection of markets Objectives:

Assessing and Analyzing Markets Market Screening  A version of environmental scanning in which the firm identifies desirable markets by using the environmental forces to eliminate the less desirable markets  Environmental Scanning  A procedure in which a firm scans the world for changes in the environmental forces that might affect it

Market Screening  Permits management to identify a small number of desirable by eliminating those judged to be less attractive

Market Screening  Two Types of Screening  Country Screening  Using countries as the basis for market selection  Segment Screening  Using market segments as the basis for market selection

Initial Screening… Basic Need Potential  If the need is lacking, then no reasonable expenditure of effort and money will enable the firm to market its goods and services  Easier for producers of specialized industrial materials or equipment than for widely consumed products

Initial Screening  Resources to establish need potential  Market size (present and potential)  Imports do not fully measure market potential  Review reports by various embassies  Department of foreign and international trade

Second Screening: Economic and Financial Forces  Measures of market demand based on economic and financial data  Market indicators  Market factors  Trend analysis  Cluster analysis

Market Indicators  Market Indicators  Economic data used to measure relative market strengths of countries or geographic areas  Possibilities:  Market size  Market growth rate  E-commerce readiness

Market Factors  Market Factors  Economic data that correlate highly with market demand for a product  Estimation by analogy

Trend Analysis  Trend Analysis  Statistical technique by which successive observations of a variable at regular time intervals are analyzed to establish regular patterns that are used for establishing future values

Cluster Analysis  Cluster analysis  Statistical technique that divides objects into groups so that the objects within each group are similar

Third Screening: Political and Legal Forces  Entry Barriers  Import restrictions, local participation requirements, local content restrictions, government-owned competition  Profit Remittance Barriers  Undue restrictions on repatriation of earnings, limits to FDI, inability to provide foreign exchange  Policy Stability  Political climate, government stability, public unrest

Fourth Screening: Sociocultural Forces  Screening on the basis of sociocultural factors is challenging  Sociocultural factors are fairly subjective  Data are difficult to assemble, particularly from a distance

Fifth Screening: Competitive Forces…  The number, size, and financial strength of the competitors  Their market shares  Their marketing strategies  The apparent effectiveness of their promotional programs  The quality levels of their product lines

Fifth Screening: Competitive Forces  The source of their products--imported or locally produced  Their pricing policies  The levels of their after-sales service  Their distribution channels  Their coverage of the market

Final Selection of New Markets…  Personal visit to potential markets is essential  Field Trip, unhurried  Government-Sponsored Trade Missions  Trade Fairs

Final Selection of New Markets  Research in Local Market  Face-to-face interviews reveal information that would never be written  Hire local research group  Person in charge of the project must have experience in that country or culturally similar one in same geographic area

Local Research Problems  Cultural  Language  Literacy  Social desirability bias  Technical  No up-to-date maps  Streets have different names  Houses not numbered  Only wealthy have telephones  Mail delivery issues

Research in Developing Nations Less research performed Often a seller’s market Competition is frequently less intense in developing nations because fewer competitors management struggling with problems other than marketing

Finally Segment Screening –Definable: identify and measure –Large: to be worth the effort needed –Accessible: for promotion and distribution –Actionable: have control of marketing programs –Capturable: potential exists