MOD 2 Case Promotion Management Questions
ANSWER
- Market Growth:
- Market Size: This refers to the total sales or revenue generated in the market. A larger market size often indicates more opportunities for a business, but it may also mean higher competition.
- Growth Rate: Examining the historical and projected growth rates of the market can help a business understand if the market is expanding, stagnant, or declining. Rapid growth may present attractive opportunities, but it can also lead to saturation and heightened competition.
- Market Potential: This considers the untapped or underserved portions of the market. Identifying niche segments with growth potential can be a lucrative strategy.
- Competitive Intensity:
- Number of Companies: Assessing the number and size of competitors in the market is crucial. A highly fragmented market with numerous small players might be easier to enter but can also be fiercely competitive.
- Ease of Entry: This includes evaluating barriers to entry such as regulatory requirements, capital investment, and access to distribution channels. Markets with high barriers can be less attractive for new entrants.
- Substitutes: Understanding the availability and attractiveness of substitute products or services can impact market attractiveness. A market with readily available substitutes may be less attractive.
- Market Access:
- Customer Familiarity: Examining whether the target customer base is already familiar with the product or service can affect market entry. Entering a market where customers are unfamiliar may require more marketing effort.
- Channel Access: Assessing the availability and accessibility of distribution channels is vital. It’s important to know if your business can effectively reach the target audience through existing channels.
- Company Fit: Evaluating how well your company’s strengths, resources, and capabilities align with the demands and dynamics of the market is essential. A good fit can lead to a competitive advantage.
It’s important to note that these criteria often intersect and influence each other. For instance, a market with high growth potential may also attract more competitors, increasing competitive intensity. Moreover, market attractiveness can change over time, so continuous monitoring and adaptation of strategies are crucial for long-term success.
Ultimately, businesses should tailor their criteria for evaluating market attractiveness based on their unique circumstances, goals, and resources. What may be an attractive market for one business may not be the same for another, even within the same industry.
QUESTION
Description
Every business should determine its own standards for success when evaluating the attractiveness of a market, since every industry has its unique circumstances. Criteria that influence Segment Attractiveness include:
- Market Growth (Market Size, Growth Rate, Market Potential)
- Competitive Intensity (Number of Companies, Ease of Entry, Substitutes)
- Market Access (Customer Familiarity, Channel Access, Company Fit)