1. Marketing “If everything seems to be going well, you have obviously overlooked something”

2. Marketing Market Analysis Candidates should be able to: give reasons for market analysis explain the value of market analysis use moving averages, test markets, extrapolation and correlation to analyse markets describe situations where information technology may be used in analysing markets evaluate difficulties in analysing markets

3. Marketing Market Analysis Market analysis involves looking at data and identifying trends. Reasons for analysing markets include:

4. Marketing Market Analysis Value of market analysis:

5. Marketing Market Analysis A trend is the u________ pattern of growth or decline within a set of data. Trends can only be seen with a reasonable amount of data – one or two figures is not enough!

6. Marketing Market Analysis Methods of trend analysis include: extrapolation moving averages test markets or market research correlation ask ‘experts’

7. Marketing Market Analysis Extrapolation analyses the p________ performance of a variable such as sales and extends this into the f__________. Extrapolation can be done by ____ but a more scientific approach is to use moving averages. Use the data on the next slide and work out the three period moving average.

8. Marketing Market Analysis Yearperiodsales3 period total3 period moving average 200513 263 + 6 + 7 = 1616 ÷ 3 = 5.3 376 + 7 + 2 = 1515 ÷ 3 = 5.0 200612 25 37 200713 25

9. Marketing Market Analysis Yearperiodsales4 period total8 period total4 quarter moving average 200515 27 38 44 200615 28 311 43 200714 26

10. Marketing Market Analysis Yearperiodsales4 period total8 period total4 quarter moving average 200515 27 5+7+8+4=24 3824+24=4848÷8=6.0 7+8+4+5=24 4424+25=4949÷8=6.125 8+4+5+8=25 200615Etc.

11. Marketing Market Analysis The use of moving averages should smooth out the impact of random variations in data and longer-term cyclical factors, thus highlighting the trend. If asked to plot a graph you should plot sales on the y- axis and time on the x-axis

12. Marketing Market Analysis By predicting trends, firms are able to This is invaluable:

13. Marketing Market Analysis Need to be able to draw five types of trend: Positive expanding market Negative declining market S-trend (product life cycle) Zero trend No trend

14. Marketing Market Analysis What are the drawbacks of extrapolation?

15. Marketing Market Analysis IT can be used to analyse markets by:

16. Marketing Market Analysis The advantages of IT are that However there are disadvantages –

17. Marketing Market Analysis Difficulties in analysing marketing data extrapolation: as earlier test markets: market research: ask ‘experts’: