Chapter 4 - Market/Submarket Analysis

Question 1

Dimensions of a Market analysis

Answer 1

Emerging sub markets
Actual and potential market and sub market size
Market and sub market growth
Market and sub market profitability
Cost structure
Distribution systems
Trends and developments
Key success factors

Question 2

Customer decision process

Answer 2

Brand relevance

 - select product category or subcategory 
 - determine brands to consider

Brand Preference
- select brand to buy

Question 3

Groups to help structure a market analysis

Answer 3

Submarket
Size and growth
Profitability
Cost structure
Distribution systems
Market trends 
Key success factors

Question 4

Submarket

Answer 4

Are augmented products, emerging niches, trend toward systems, new applications, repositioned product classes, customer trends, or new technologies creating worthwhile sub markets, how should they be defined?

Question 5

Size and growth

Answer 5

Potentially important sub markets? Size and growth characteristics? Sub markets declining? How fast? Driving forces behind what trends?

Question 6

Profitability

Answer 6

How intense is the competition among existing firms? Threats from potential entrants and substitute products? Bargaining power of suppliers and customers? Attractive/profitable markets or sub markets

Question 7

Cost structure

Answer 7

Major cost and value-added components for various types of competitors

Question 8

Distribution systems

Answer 8

Alternative channels of distribution? How are they changing?

Question 9

Key success factors

Answer 9

Key success factors, assets, and competencies to compete successfully? Can assets and competencies of competitors be neutralized?

Question 10

Detecting maturity and decline

Answer 10

Price pressure caused by overcapacity and the lack of product differentiation
Buyer sophistication and knowledge
Substitute products and knowledge
Substitute products or technology 
Saturation 
No growth sources
Customer disinterest

Question 11

Porters five factor model of market profitability

Answer 11

Industry profitability

Competition among existing firms
Threat of substitute products
Bargaining power of customers
Bargaining power of suppliers
Threat of potential entrants

Risks of high-growth market

Competitive risk
Firm limitations
Market changes