The risk associated with taking and implementing business decisions could be significant, especially if substantial financial resources are to be utilised against some predicted future events. Predictions are the likelihood of future events and therefore these is often an element of subjective and objective judgement involved.
The important fact is, that decisions will most likely be successful if using high quality, reliable and correct information. Therefore, gathering the information is an essential part or marketing role.
As I have mentioned before in my talk about the role of marketing and its focus, the information flow both ways: from the inside and outside. We gather the information from customers to predict future needs and wants and we also release information to promote the product or service and the brand image.
This suggests that information is the core of marketing process. Marketing professionals will only be successful if they know exactly what information they need to have to drive business decisions. This is done with that main goal of attracting more and retaining current customers.
The business leaders therefore need to have a good knowledge of the environment in which the business operates, both internal and external factors as well as the main characteristics of customers and the customer profiles.
A reasonable process flow would be to consider wider business objectives first, analyse the market, prepare market strategy and design a marketing plan.
We also know already, that there are two main types of sources of information: primary and secondary. The primary sources would include gathering the data directly, for example from surveys, customer feedback, complaints. Thats where the data is collected. The secondary source of information is the data collected by others. This will involve articles, research, newspapers etc.
How do we use the information sources?
Market research provides business with information they need to make informed business decisions. We will access the two type of sources primary and secondary?
The primary research have never been performed before, therefore we need to find the information ourselves. We can conduct interviews and look at the industry or financial reports. The primary sources would be when we are the first to experience a discussion. Conversely if we have watched a video of that interview, that would be a secondary source. Looking at industry sales and financial reports would also be considered a secondary source.
With secondary research concept the data already exists. Secondary reports are often produced by specialists in market research and thats where we can gather relevant information concerning relevant industry or market. Trade and industry associations provide a great range of information. The advantages of a secondary research is that they are often free and easy to find. It also provides a good source of market insights and is quick to access. Because of the expertise of those who produce this data, they are often good source of ket market trends. Unfortunately, secondary data can very quickly become out of date. It is not always designed to address specific market needs you need to evaluate and some of them could become very expensive.
The business environment
We must not forget that the organisation must understand not only the external environment and customers behaviours, but also have a knowledge of internal factors. For example financial information, human resources, existing products, development of new products as well as the overall business strategy.
There are four main business environment factors determined to consider: customer focus, competition, cooperation and the market.
Each one of them will have different set of questions to consider:
Competition
* Who are our competitors and what impact they may have on us?
* What is the likely threat of new competitors in the market?
* What is the potential threat of products and services alternatives?
Customer focus
* Who are our customers?
* Which customers should be targeted?
* What are our customers expectations towards the product quality?
Co-operation
* What are the threats and opportunities of our informal like with other organisations?
* What are the threats and opportunities posed by formal arrangements?
* What are the wreaths and opportunities form complimentary products or services?
The market
* What is the size of the market?
* Is the market likely to grow or shrink?
* What is our market share and can we increase it?
The above mind map will be specific to your business context .
PEST and SWOT analysis
The PEST analysis is one of the tools helping to evaluate the external environment. The main goal of this analysis is to gain understanding of the wider factors that affect the business. Those will have impact on the business and consequently impact on the marketing strategy and plan. The secondary information would normally be used and these include: information from trade industry associations, market research databases and reports or government departments information.
The SWOT analysis looks more closely on the internal environment of the organisation. It should use the information gathered from PEST analysis and take account for the internal environment.
Small independent producers
Here the question come to mind: can small independent producers survive in this competitive world?
Thats where the analysis comes to play. Studying the challenges confronting them, determining their advantages both in domestic and international markets. The marketing evaluations are very important here and can generate relevant solutions facing the group problems. Many small producers have proven that effective marketing can provide a significant competitive advantage. This requires detailed understanding of the market and their target customers. Understanding the customers allows to identify the main benefits of the products they are selling. It is necessary to promote the brand in order to attract the potential customers. A good brand image will create a positive associations in the mind of the potential customers. Strong brand have also greater leverage on distribution. Prices should be justified by the quality of the product but not by the cost of production. However producers are to beauteous of costly techniques and production processes.
Marketing strategies will also determine whether introduction of another product is necessary. Analysing potential competitors would allow to accurately choose the markets to be entered. Considerations of cultural changes should be made as well as the production mentality.
Market research should become the key of the small independent producers operations. This will allow them to adapt quickly to changing needs and environments. Strategies can be developed to maintain current customers and attract the new ones. Foreign markets should be carefully studied and evaluated.
These organisations need to carefully consider when developing new product or service, modifying existing product or service, or exit a particular market and discontinue the product or service.
Those type of changes require considerable investments and forward planning is imperative to enable the change to be implemented. All the changes have of course associated risks. Companies need to consider those as well as the consequences as rests of failure.
These analysis carefully conducted will enable to set the strategic objectives. We know that setting SMART objectives is one of the most powerful tools.
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