Marketing and Sales - Market Research and Analysis

1. Introduction: Hello, and welcome to this marketing and sales course, where we take a closer look at market research and analysis. So we start off by looking at how we conduct analysis and how we interpret the data. And we also look at how we can design our questionnaires and surveys to make sure we get really good data back. Then look at how we analyze the market situation and the way we would segment customers based on that. Then we look at our competition. We analyze their strategies and see what they're doing and see what we can use for our own benefit. Part of that is a so called swat analysis, and the last lesson in this course takes a closer look at a swat analysis. It looks at what it is and how we do it. As with all skill share courses, there's a project that you can do at the end of it, and this is no different. The fact there's two here, you can do both if you like, you can do either of them completely up to you. They're in the description. Very roughly, we take a product, either real or imaginary, and we look at the market analysis for that. And the other one takes a closer look where we do a SWAT analysis for that imaginary product, and what you can do is compile all your results together, upload it onto the platform. I'll be more than happy to give you feedback. Anyway, I hope you enjoy the course. You find it informative and interesting. Any questions, please use a Q&A, U will get an answer. 2. Conducting Market Research and Analysis: Welcome to this lesson on conducting market research and Analysis. Suppose the obvious question is, what is market research? Here's a nice definition. Market research is a systematic process of gathering, analyzing, and interpreting information about a target market or industry and to inform business decisions. So it plays a really important role in understanding customer needs, and identifying market opportunities and led by developing effective marketing strategies. In this lesson, we'll look at the objectives and benefits of market research, as well as different types of market research. Now the objectives. Why are we doing this? We're doing it to gather information and insights about the market, the customers, the competitors, and industry trends. Here are some key objectives or reasons for doing market research. We understand customers needs and preferences. We can identify target market segments. We can assess market potential. We can evaluate the competition. We can identify trends and opportunities. We can fine tune our marketing strategies. We can assess the brand perception and our reputation, and we'll use all of this to support our decision making. We'll look at each of these a bit more detail now. To understanding customer needs and preferences. So we use market research to gain a really deep understanding into really what our customers want, what they need, what they prefer, their behaviors, and their buying patterns. This will enable a business to identify the customer pain points and develop products or services that meet those needs. As an example, mobile phone manufacturer would conduct market research to understand customer preferences for things like screen size, camera quality, battery life, and other features. Then they will use this information to develop new products that then align with the customer's needs and preferences. And we identify market segments. So market research helps in segmenting the market based on things like demographics, psychographics, and other relevant factors. And by identifying specific market segments, businesses can tailor their marketing efforts to reach and engage their target audience. For example, a fashion retailer would conduct market research and identify segments based on things like age, income, and style preferences, and then use this to tailor its product offerings and its marketing messages, and even things like store layouts to really suit that specific segment. We can also assess the market potential by getting insight into the size and potential growth of a market. This would help a business to evaluate, for instance, marketing or market opportunities, to determine the demand in the market, and then identify gaps in the market which have yet to be tapped, so called untapped areas. As an example, a software company would conduct market research, they'd estimate the size of the market, and the growth potential for say a new project management tool. And this research would help the company to assess the demand for such a tool and make decisions about investing in it and which marketing strategies they would use. We can also evaluate the competition. Use market research to assess what the competition is doing. What are their strategies, their offerings, their pricing, and their positioning. We would use this to identify of our competitive advantages and develop something that makes us stand out from the market. Though a car manufacturer would conduct market research, and they would analyze the competitors offerings, pricings, and strategies. They would then use these insights and identify areas of differentiation. Where are we different? Where are we better? What can we improve and effectively sort of how can we position ourselves in the market better? We can also identify trends and opportunities. So we stay up to date on the marketing and industry trends. We look at emerging technologies and how say customer behavior changes over time, and we would then identify new opportunities based on this. We would adapt to shifts in the market and thereby stay ahead of the competition. As an example, a food delivery service would conduct market research and identify, say, a growing trend of plant based diets and an increasing demand for healthier meal options. And then based on this research, the company decides to introduce a new menu of plant based meals, which would then cater to the market trend and thereby seize this new opportunity. We also test and refine our strategies. Market research allows a business to test their marketing messages, their concepts, their pricing, and their advertising before ramping it up to full scale implementation. And this would help them to refine their marketing strategies based on customer feedback and market response. As an example, A E commerce company conducts market research to test different marketing messages and promotions with a small sample group of customers. And then the data they get from this research helps the company to identify which messages resonate the most effectively and then refine their marketing strategies according to this. We can also assess how our brand is perceived in the market and our reputation. So we engage customer perceptions of the brand, the products, or the services. And these insights into our brand reputation and satisfaction levels will tell us where we need to improve. For example, a hotel chain would conduct market research to measure customer satisfaction, identify areas for improvement, and generally monitor the reputation of the brand. They would use the findings of this research to improve its customer experience. They would address any negative perceptions and then try and maintain an overall positive image. We use it to support decision making. To market research provides data driven insights that support business decision making across a wide range of functions such as product development, marketing, sales, and customer service. It reduces risks associated with decision making by providing reliable information. This is important data driven decisions, not based on feelings. A financial service company would conduct market research to get insights on customer preferences for say, online banking features. Then it would use this data to make informed decisions about which features to develop or improve to meet the customer needs and improve their user experience. Okay, so we found out what we can do. What are the benefits of it? There are many benefits to performing market research. And here are a few of the more important ones. We understand customer needs. We can identify market opportunities. We reduce or mitigate business risks. We optimize our marketing strategies. We can assess what the competition is doing. We can enhance our own product development. We would support business growth and expansion. We thereby improve customer satisfaction and retention. We would validate our business decisions, and of course, we'll track and measure performance, and we'll look at each of those intern now. So understanding customer needs. What are their preferences? How do they interact? What are their behaviors? This is what we can gain from market research. And this knowledge will enable us or our business to develop products, services, and strategies that resonate with the target audience, I who we want to sell to. For example, a smartphone manufacturer, as we mentioned, would conduct research, to understand preferences on screen size, camera, quality, storage, and price, and use this knowledge then to develop smartphones that align with the customer needs and desires, increasing the likelihood of customer satisfaction, sales, and overall success. You can identify market opportunities. We look at customer insights, we look at what the competition is doing, and this market research will help us to identify new opportunities. We may find untapped customer segments, we'll find emerging trends, needs that have not yet been met by any competition or ourselves, and we'll then capitalize on these opportunities to develop to fill the hole in the market. So a beverage company would conduct market research, and they discover, there's a growing trend of consumers who are looking for healthier options when they want something to drink as based on this, they introduce a new line of low sugar products with natural ingredients that thereby tapping into this opportunity and attracting health conscious customers. Can also mitigate business risks associated with new launches, with marketing campaigns and expansion. We can use these insights from market research to really inform our decision making. And this reduces the chance that we make of expensive mistakes and increases the chance of success. Look at, say, a retail clothing brand wanting to expand into a new city. So before they make any investment, they do market research to assess the local demand. They see what the competition is doing, and they look at the demographics in that area. And this research then helps them make an informed decision about the expansion, thereby minimizing the risks of entering an unfavorable market. We can also optimize our own marketing strategies. We will refine our own marketing strategies by understanding the customer preferences, the trends, and what the competition is doing. This will then help a business to really fine tune their messaging and their positioning and the promotions they conduct, to effectively reach and engage their target audience. For example, an e commerce company would conduct market research if they want to understand the preferred communication channels and online behavior of its target audience. Then with this information, the company develops personalized e mail marketing campaigns, social media advertising, maybe even influencer partnerships, to really effectively reach and engage with their customers, which should result in increased web traffic and conversion. Can also assess the competition. This gives us or market research, gives us really important and useful insights into what the competitors are doing in terms of their strategies, offerings, and their positioning. This information can help business to evaluate their competitive advantage. They can also identify areas for differentiation. Are you aware are we different and thereby make data decisions, informed decisions to stay ahead of the competition. A electronics manufacturer conducts market research to analyze the customers or the competitors' pricing, their product features, and their marketing strategies. And this analysis then allows the original company to position its products competitively. They would highlight their own unique features, unique selling points, which would then differentiate them from the market, and then attract customers who value these specific attributes. Can also enhance product development. We can test products and market research will help us to improve existing products and even develop new ones. This makes sure that our products meet the customer expectations that they address any pain points we've identified, and we then deliver value which will increase their satisfaction and loyalty. A software development company would conduct market research to gather customer feedback on an existing product. They will then use this research to identify areas for improvement. They can understand the user pain points, where they're having trouble using it, and then update accordingly, resulting in a more user friendly and market responsive product. We can support business growth and expansion. This would help the business to identify new markets, maybe evaluate the potential and then make informed decisions about whether to enter that market with which products and where. A food delivery service would conduct market research to identify cities with a high demand for food delivery and like a lack of established competition, holes in the market. And based on this research, they would strategically expand the services into these cities, thereby capitalizing on the potential and growing its customer base. We can improve customer satisfaction and retention. So if we can better understand our customer needs and preferences, we can actually deliver a better customer experience. This needs, then, of course, to increase customer satisfaction and loyalty, and you get positive word of mouth recommendations, which is very good for long term relationships. The hotel chain would conduct market research to measure customer satisfaction levels, identify areas for improvement, and try and get a handle on what their guests prefer. Then the research then would allow the chain to improve its amenities, tailor its services to meet the specific customer needs, and ultimately improve the experiences of their guests, which would lead to higher satisfaction and then repeat bookings. We can validate business decisions. We really provides us with data driven insights that validate our previous decisions. It would help a business to evaluate the feasibility and viability of new initiatives. We can assess market demands and really justify investments to any stakeholders. An investment firm conducts market research to assess the demand and viability of a potential investment opportunity. The data provided from this research on say, market size, growth, potential, customer preferences, et cetera, would help the company to make an informed decision based on cold hard data and then justify the investment to any stakeholders. We can track and measure our performance. So this will allow us to track and measure the effectiveness of our marketing campaigns, our product launches, and see how satisfied our customers really are. We get metrics and feedback that would help a business to identify where the improvement potential is and then make data driven decisions. A cosmetic brand will conduct market research to evaluate the effectiveness of its recent advertising campaign. And the data analysis and survey will enable the brand to measure the awareness, the engagement, and the purchase intent and compare this with the figures before and after the campaign. So with this, we can assess the campaign's effectiveness, the impact, we can make adjustments if necessary, and then use this data to optimize our future marketing efforts. L's look now at types of market research. There's not just one thing. There's different types of market research, and businesses can use all of these to gather insights and data in which to make informed decisions. What we're going to do now, we'll look at various types of market research and then look at the advantages and disadvantages of each. Specifically, we'll look at surveys, interviews, focus groups, observational research, and so called secondary research. We'll start with surveys. Surveys would involve collecting data, say through questionnaires, and this can be online, it can be over the phone or even in person. They can be structured, closed ended, unstructured, open ended, and they can be conducted with large sample sizes. The advantages of these, you get really quantitative data collection. You can get broad insights and reach a large audience. They're very cost effective and they can easily replicated. The disadvantages They're very susceptible to the wording and response biases. So you have to be very careful in how you phrase the questions. And it may be challenging to get high response rates and the respondents, they just might either give you wrong answers or just exit halfway through. A restaurant chain would conduct customer satisfaction survey, and they get feedback on the food quality, the service, the ambience, and the overall dining experience. And then obviously use this for improvement, as we said earlier. We have interviews. Interviews, this is direct conversations with either individuals or small groups, and here we're looking for qualitative insights. Again, they can be structured with predetermined questions or unstructured, just an open discussion. So the advantages of these is you can get really in depth understanding, you can clarify responses, you can dig a bit deeper into certain points, and this will provide you with quite rich qualitative or subjective data. You can also then get rapport with participants and they feel they're being taken seriously. The disadvantages. This is very time consuming and therefore expensive. You usually have a smaller sample size, which limits how generally you can extrapolate this data. Then you also have the interviewer, bias and a participant bias might also affect the results. We'll look at these later in the lesson. A software company would conduct in depth interviews with target customers to understand their needs, their pain points, and preferences for new software products. We have focus groups. These are like a moderated discussion with a small group of individuals, usually six to ten people, and they want to share their opinions, their perceptions, and experiences related to specific topics. The advantages here, they are very interactive discussions. You can get really good insights into the opinions and consensus of the group, and sometimes you get surprising insights that you didn't expect. But the disadvantages. They obviously, we have a group dynamic here and that can influence the results, and you may have sort of one or two, very dominant people in the group who would then influence the group generally. And the sample size is small, six to ten people. And this might not actually represent, might not be representative of the larger community or population. So a drinks company conducts focus groups with customers to get feedback on, say, potential new flavors, packaging, designs, and marketing messages. We have observational research. What we do here is we just observe and record consumer behavior in real world or controlled settings, and we don't actually directly interact with them. We just watch. And the advantages here is you get good insights into what the consumers actually doing, and you eliminate a lot of biases that is associated with the previous things we've mentioned. It also gives us non verbal cues, and in specific context, people do different things. Fic the disadvantages. Observational research is actually quite time consuming and thereby expensive, and can actually be quite difficult to do. And the other problem is that we're observing people and making subjective interpretations, and it might actually be difficult to really work out why they're doing what they're doing. So a retail store uses video cameras, and they observe customers browsing and purchasing behavior. They would look at traffic patterns, they look at where people go in the stores, which are the popular product displays and look at general interactions with staff and use this to change their maybe the displays or their store layout. The last one we have is secondary research, and this uses of existing data and information that other people have done. And this could be government agencies, can be industry reports, can be studies or online databases. So the advantages here as very cost effective because the data is already there, and it provides quite a lot of data on trends, market sizes, demographics, and consumer behavior. And because it's already there, this saves you a lot of time and effort when you compare it to doing your own research. But there are disadvantages, and it may be too general. It might not specifically address the thing you want to know. And also the quality and reliability of the data may vary. We also don't know when it was done and if it's really specific to your needs. As an example, an e commerce start up would analyze, say industry reports, they look at the competitor websites, and they'd read customer reviews, and they'd use all of this to get information on market trends, say target audience characteristics, and generally the competitive strategies of other people. 3. Designing Surveys and Questionnaires: Welcome to this lesson on designing surveys and questionnaires. An effective survey involves careful considerations of several elements, and we do this to make sure that our survey gives us accurate and reliable data. As we said in previous lessons, a lot of these are quite expensive, so we might as well get it right. But here are the key elements of an effective survey design. There's quite a lot and we'll look at them all in turn afterwards. We want clear research objectives. We need to know who our target audiences. We need a structured questionnaire. We have different question types we need to think about. We have to have clarity and simplicity. We need to avoid biased questions. We also need to avoid ambiguity. We need a certain order and layout. We have to give them different response options. We have balanced scales. Pretesting, length and time, either duration. We need to also be aware of anonymity and confidentiality, data protection, and we need to test and validate the surveys, and we'll look all of these intern nell. Clear research objectives. Obviously, if you don't know what you want to find out, it's going to be very difficult to generate as a sensible questionnaire. You start by specifying what you want and what your survey is about. This will then help you in getting your survey with relevant questions and to really focus on the objective. Hotel chain would aim to understand customer satisfaction levels and identify areas for improvement. The research objective could be defined as to assess customer satisfaction and identify areas for improvement in hotel services. We also need to identify the target audience for the survey. We need to make sure that the questions and the language and the phrasing used are appropriate for them. We need to consider demographics, characteristics, and of course, the knowledge levels of the audience. The software company conducts a survey to gather feedback from its existing customers about a recent update. The target audience here is clearly defined as current customers who have used the software in the past three months. We need to structure our questionnaire. It needs to have a logical flow. We begin with introductory questions on which to set the context, and then we have our main questions, but we group them by topic, and we conclude with say some demographic or optional questions. A market research firm designs a questionnaire with sections on demographics, purchasing behavior, and brand preferences. These sections are organized and logical order, starting with the basic demographic questions and progressing to the more specific inquiries. And we have different types of question which we use to gather different types of data. Common question types include multiple choice, rating scales, open ended and ranking questions, and we choose the type of question that best suits the information we seek. A car manufacturer will use a mix of question types. They will have multiple choice questions to assess a brand awareness. They will have rating scales to measure customer satisfaction and open ended questions to get general suggestions for improvement. We also need to make sure that our questions are clear, concise and easy to understand. We need to avoid jargon or technical terms or highly complex sentence structures. Et use simple, straightforward language so that we don't end up confusing the people we're talking to. So a health care provider conducts a patient satisfaction survey. They would use clear, simple language in the questions to make sure the respondents understand the purpose of the questions. For exstance, how satisfied are you with the quality of care you received during your recent visit. Fairly clear unambiguous question. You also need to avoid biased questions. This is a really bad thing and it happens a lot because if we need unbiased questions so that we don't push the respondent to all specific answers. We want to avoid so called loaded or leading questions that may influence the response. Just as an aside here, you can always see these bad design questions particularly in political surveys, where they will ask three or four leading questions and then ask the question they want a specific answer to. Depending on who's doing the survey, The leading questions will push you one way or another, depending on what your particular political party wants to prove that people want. So this is a topic which has a lot of potential for abuse and misuse. Just to give you a very quick example, if you are looking for neutral questions, instead of asking, do you agree that their policies are beneficial? You might ask do you support or oppose their policies? It's a lot more neutral. The second one is more neutrally posed. We also need to avoid ambiguity, we need to make sure that the questions are specific and precise because ambiguous questions, they can lead to inconsistent inaccurate responses, and so we need specific time frames or specific quantities. We'll look at examples. If a consumer goods company is asking a specific question to avoid ambiguity, Instead of saying how often do you use our product, they would ask how many times per week do you use our product? Because how often is very subjective, people might say five times. Is in what time frame. But by phrasing it how many times per week, they get much more meaningful responses. Now we look at the order and layout. We need to arrange questions in a logical and coherent order. We begin with general less sensitive questions, we gradually progress to more specific and potentially personal questions. We need a consistent layout and formatting to keep the visual appeal and the clarity so that people aren't distracted by the continually changing layout. A market research agency will arrange questions in a logical order. They begin with introductory questions such as demographics, and then move to questions about product usage. They conclude with questions about satisfaction and loyalty. Then we have to look at the response options. We need to have appropriate options for each question type. We need to ensure that the response categories cover all the possible answers, and we have to allow the respondents to select the most appropriate or relevant option, and we should include an other or not applicable where it makes sense. For a survey about mobile phone preferences. They might have options, such as say a multiple choice, and have apple, Samsung, Hu away, and other. This allows the respondents to select the particular brand they wish to choose. Sometimes the other will just leave it at other, and sometimes the other will then make another box where you can put in by hand, which other you mean. And imbalance scales. We need to make sure that we have an equal number of positive and negative options, and we want to avoid response bias caused by imbalance in the scales that lead towards one end or the other. A customer feedback survey would have a five point rating scale with equally positive and negative options. By providing this balance scale, The respondents can provide unbiased ratings on satisfaction levels. So what we mean here is you don't just ask how wonderful everything is, you don't just ask how bad everything is, you mix it up equally. You have pretesting. This is important because you need to make sure that your survey is good. What you would do, you give a small sample of respondents and you'd see if there's anything that's ambiguous, or if there's any potential biases or any problems generally with the survey. Then based on the feedback from them, you would adjust the survey to improve the clarity and the quality before letting out on a larger number of people. So a marketing agency will pre test a survey with a small group of individuals that are representative of the target audience. That's an important point. Then based on their feedback, they will refine and clarify questions to make sure that the respondents understand them correctly. Length and time of the survey. Ida they should be short and focused. Otherwise, the respondents, they just leave. Long surveys with loads of questions. After a while, the respondent just get fed up and they're just going to do something else. You only get half a response. What you need to do is to estimate how long you think the survey will take to complete and tell the people who are doing it so that have expectations. A employee engagement survey would estimate that it would take 10 minutes to complete. This then helps the respondent to know, it's going to take 10 minutes. I have 10 minutes. If they only have 10 minutes and it takes 30 minutes, well, they're going to leave after 10 minutes and you only have a third of it done. Anonymity confidentiality, data protection, privacy. We need to make sure that their responses are anonymous and confidential, and this will then encourage honest and accurate answers. You should clearly communicate how any data will be used and how it will be protected. To a healthcare organization assures patients that their survey responses will remain confidential and anonymous, and they explain that the data is aggregated and used for quality improvement purposes only. We need to test and validate. We need to know how reliable and valid a survey is. We test the survey for consistency and conduct statistical analysis and ensure that the survey measures what it intends to measure. Her research company conducts a pilot study to a survey's effectiveness. They compare responses from a small sample and then use that to assess reliability and validity. Based on this, they make adjustments before conducting the full survey. What are the common pitfalls in survey design? There are actually quite a few ways, many ways, indeed, which you can completely foul up a survey. But here are some common ones we'll just look at. Four common ones. We have leading questions, double barreled questions, response bias, and non exhaustive options. We'll look at each of these now. So Leading questions. We want to avoid questions that steer the respondent towards a particular answer because this will compromise our objectivity and reliability of the data. Here are some bad examples. Don't you think our product is the most innovative one in the market? What are you supposed to say? How satisfied are you with the excellent customer service we provide? You're telling them it's excellent and you're asking them how satisfied are they? I mean, they're going to call they're not going to say dissatisfied. You believe that our new and innovative approach will solve all your problems. Again, you're telling them that you're new and innovative and you're pushing them the wrong way. You're not getting an honest answer. Considering the superior quality of our brand, how likely are you to recommend it to others? Again, it's not a neutral. It's a leading question. You've mentioned the superior quality, you're not going to get meaningful answers. Unless, of course, you have an agenda and you wish to fabricate data to back it up, and then you would use leading questions. See the previous comments about political surveys. We have double barreled questions. We need to make sure that each question just talks about one single concept or idea. We don't mix them up, and here are some examples of how this is done badly. How satisfied are you with the quality and pricing of our products? But quality and pricing are two separate things. How do you know which one they're talking about? Did you find the website easy to gate and visually appealing? Again, ease of navigation and the aesthetics are two completely different things. Do you think our customer service representatives are knowledgeable and friendly? Well, they might be friendly and know nothing. They could be very knowledgeable and unfriendly. But again, you're mixing things up that don't belong together. Lastly, were you satisfied with this delivery speed and packaging of your order? Again, how quickly it was delivered and how it was packaged are completely different things. But all of these split them into two separate questions that address one point. Then we have response bias. Response bias questions, they can introduce errors into our data by leading respondents towards a particular response or inflating certain perceptions? This is a bit like leading questions. In a sense, we need to make sure they're neutral and unbiased from leading language. Here's how you would do it badly. How often do you engage in environmentally friendly activities? Have you ever experienced any issues with our product or service? Then they say, on a scale of one to ten, how satisfied are you with our service where ten represents the highest level of satisfaction. It's not really a fair survey. We have non exhaustive response. We need to make sure that all the possible options are included. In multiple choice questions, this often means that you have a an other or not applicable option within it. 4. Exploring Target Markets and Customer Segmentation: Welcome to this lesson on exploring target markets and customer segmentation. In this lesson, we will look at what we mean by target markets and what we mean by customer segmentation. I will also see how we can effectively apply segmentation strategies to reach out to certain target audiences. Target market. What exactly is a target market? A target market refers to a specific group of individuals or organizations that a business aims to serve with its products or services. By identifying and understanding the target market, we can then successfully market and sell to these people. It allows a business to focus their resources and efforts on the most profitable customer segments. It also enables customization of product, services, and messaging to better meet the customer's needs. It facilitates effective market positioning and differentiation strategies. Some target market examples. A luxury car manufacturer will target affluent or wealthy professionals who value high performance and prestige. Whereas a fast food chain would target young adults who are looking for quick affordable meals on the go. A software company might target small businesses who are looking for user friendly accounting solutions. We mentioned customer segmentation. Well, what do we mean by customer segmentation? This is the process of dividing up a broad target market into distinct subgroups based on some common characteristic need or behavior. These smaller groups are then easier to manage. It helps a business to tailor their marketing strategies to specific customer segments, and this would then result in improved satisfaction and higher marketing effectiveness. We have certain criteria that we can use to segment our customers, but this will of course depend on the industry and also the product or service that we're offering. Some common factors would include demographics such as age, gender, income, education, et cetera. Geographic location. Where are they? So called psychographics, which is the values, interests, and lifestyles, and behavioral patterns. It could be purchase, history, brand loyalty, online activity, et, by analyzing these variables, a business can identify distinct segments with unique preferences and characteristics that they can then address. Look at demographics. This is dividing customers based on their so called demographic characteristics. A few examples of these you mentioned earlier would be age. A toy company would target different age groups with age appropriate toys, offering maybe educational toys for toddlers, action figures for school children, and puzzles for adults, or by gender. Cosmetic brand might have separate product lines for men and women, and they would then tailor their marketing messages and packaging to appeal to each of the men and women's or specific preferences. Also use income. Some say an upscale fashion retailer might target high income individuals and would offer them then luxury brands and exclusive shopping experiences, whereas a discount store would probably focus on price sensitive customers with lower income levels. The last one we look at that example is education. Say an online learning platform might have different courses, targeted at different people with different education levels. They might have also say beginner intermediate and advanced courses. We look at geographic location. This is a segment based on where the customer is. Some examples of geographic segmentation could include say the country or the region. An international fast food chain might change their menu based on the regional preferences and cultural norms and offer different items in different countries. Climate of another one, a clothing retailer would segment their customers based on the climate and offer warm winter clothes to customers in colder regions and light weight clothing for those customers in warmer regions. Or we have urban or rural. An Internet service provider could tailor its marketing efforts differently to customers in urban areas, in towns and cities, where they would emphasize the high speed connections, and then maybe by rural or in the country customers, they would maybe highlight the reliability and the availability in remote locations. Now we have psychographics. Sounds a big word, but it's actually quite straightforward. It's really the customers psychological characteristics such as their values, interests, and lifestyles. Some examples here can include say values. A sustainable fashion brand may target customers who would prioritize ethically produced materials with environmental sustainability, and they would appeal to their values by offerings or eco friendly or green clothing options. We could think of their interests. A outdoor equipment retailer could create marketing campaigns tailored towards adventure enthusiasts. They might have people like hiking and camping and other outdoor activities, and they would then tailor their marketing to align with these customer interests. We could have lifestyles. A fitness center would segments or might segment its customers based on their lifestyle. They would have say busy professionals and give them convenient workout schedules and personalization plans while also appealing to stay at home parents with child friendly fitness classes. We have behavioral patterns. This is where we analyze the customers behaviors and actions related really specifically to purchasing and brand interactions, and these would include purchase history. An e commerce company could segment customers based on their past purchase behavior. They would target frequent buyers with exclusive discounts or offer personalized product recommendations based on their previous purchases. They might also look at brand loyalty. An airline may offer loyalty program and reward with to frequent flyers and provide incentives for repeat business and use this as a way to cultivate brand loyalty. Or we have the online activity. An online retailer could segment their customers based on their browsing and search history. They might target them with personalized adverts and recommendations, which, of course, are based on their online activity. What are the advantages of customer segmentation? There are many and some of the few key ones here are targeted marketing, resource optimization, customer attention and loyalty, product development and innovation, and market expansion. By looking at all of these variables, the business can identify distinct segments with unique preferences and characteristics. Look at targeted marketing. This allows a business to create co marketing campaigns for each segment. By understanding the needs and preferences of the different customer groups, a company can or develop really tailored specific messages that resonate with each segment, and this will result in higher response rates and conversion rates, which is ultimately why you're doing it. An E commerce fashion retailer may identify a segment of young female shoppers interested in casual wear. They would then create marketing campaigns that feature trendy affordable clothing options, tailored to their tastes. At the same time, they might offer or target another segment of say, affluent professionals with high end designer brands and personalized shopping experiences. So here, they tailor their marketing messages and their recommendations and promotions to the segments differently. They can increase their customer engagement and conversion rates and the overall satisfaction. They have resource optimization. What we're doing here is, we're focusing our marketing resources on specific customer segments, and by doing this, a business can optimize their budget and efforts. Instead of say adopting a vanilla, one size fits all approach, the segmentation enables an organization to allocate resources more efficiently. They would target then the most profitable segments and maximize their return on investment. If a software company has say a basic version and an advanced version of its product, it can analyze customer segments and allocate marketing resources more effectively. By identifying segments that are more likely to upgrade to the advanced version, they can focus their marketing efforts on those specific segments, and they will provide, product demos, exclusive discounts, and personalized upgrade reminders, say via e mail. Then this targeted approach really optimizes the company's marketing budget by avoiding wasteful spending on customers who are less likely to upgrade. They will also maximize the conversion rates and revenue generated from these the more receptive segments that they've identified. Which leads to customer retention and loyalty. This segmentation will enable a business to better understand the customer behavior and so use this to develop strategies which can improve the customer attention and loyalty. By identifying their specific needs and pain points in each segment, they can proactively address those concerns, build stronger relationships, and deliver personalized experiences that foster and improve customer loyalty. Telecommunications provider can segment its customer base by usage patterns and preferences. And by identifying a segment of high value customers who frequently use highly or data intensive, high data amount services and require really reliable stable network connections, they can offer tailored loyalty programs. This segment might receive, benefits such as priority customer support, maybe faster network speeds or exclusive content offerings. By understanding and addressing the unique needs of this sort of high power segment, the provider can enhance customer satisfaction, increase loyalty, and reduce churn rates. The churn rates are where people bounce backwards and forwards between different providers based on the offer of the week, which ultimately improves long term customer attention. We also use it for product development and innovation. We use these insights into customer preferences and trends to sort of guide our own product development and innovation efforts, and we make sure that the business stay relevant and meet the evolving needs of different segments. A food and beverage company can leverage customer segmentation to develop new products or modify existing ones. By analyzing these segments, we say specific dietary requirements such as vegan or gluten free consumers, the company can identify opportunities to create products that cater specifically to these needs. This could involve developing new plant based product lines or modifying existing recipes to meet dietary restrictions. Then by proactively addressing the preferences and demands of those segments, the company can gain a competitive edge, attract new customers, and then increase market share. The last thing we're looking at here is market expansion, so we can segment customers and therefore identify untapped market opportunities. So we look at the potential segments that are currently underserved or overlooked by the competition. We can develop strategies that target these segments and then expand into this customer base. An online travel agency may identify a segment of adventure seeking travellers who prefer offbeat destinations. Then they would tailor their marketing efforts to this segment, for example, promoting unique travel experiences or showcass or lesser known destinations, and then tap into an underserved market niche. And by catering to this segment specific interests and offering customized travel packages, the agency can expand its customer base and establish itself as like the go to provider for unique and off the beaten path travel experiences. 5. Analysing Competitor Strategies: Welcome to this lesson on analyzing competitor strategies. This is an important aspect in our strategic planning and market intelligence. By understanding and assessing the strategies that our competitors are using, we can get valuable insights into the competitive landscape. We can identify opportunities for differentiation and make informed data driven decisions about our own marketing, product development, and our overall business approach. What are the advantages of analyzing our competitor strategies? Well of course, there are many advantages, and we'll look at some of the common ones here, which are market insights, strategic decision making, identifying strengths and weaknesses, innovation and differentiation and risk management. By analyzing the competition, we then get a broader understanding of the marketing dynamics, the customer preferences, and industry trends. This knowledge helps a business to identify gaps in the market, which are then potential opportunities for growth and areas for differentiation. Are you aware we're different? A new entrant in the smartphone industry wishes to gain insights into the market. They analyze the strategies of the current established competition, and they look at, say their target customer segments, their pricing models, distribution channels, and then the new player can then gain a better understanding of the competitive landscape. They can identify potential gaps or underserved markets. This knowledge, in turn, helps them develop a US unique value proposition that differentiates them from the existing players. By understanding the competitor strategies, the businesses can make informed decisions regarding pricing, product development, marketing, campaigns, and customer targeting. This analysis will help them to formulate effective strategies, which in turn will give them a competitive edge. A retail chain wants to expand its e commerce presence. By analyzing the online strategies of its competition, such as web design, user experience, online marketing tactics, this retailer can make informed decisions about his own online platform and marketing efforts. They could leverage successful competition strategies while also identifying areas for improvement and thereby create a superior online shopping experiences for the customers. And also identify strengths and weaknesses. We look at, say, the competition and by comparing it to our business, we can identify our strengths and weaknesses. By identifying where the competitors excel or lag behind, a business can capitalize on their own capabilities and address areas for improvement. Software company wants to assess its competitive position in the market. They analyze the competitor strategies. They identify areas where its competitors excel, maybe customer support and product features. This analysis, in turn, helps a company understand its own strengths or weaknesses in comparison, which will enable them to invest in areas where they have a competitive advantage and improve upon weaknesses to close the gap. We'll look at this in a feature lesson where we look at SWAT analysis in more detail. We can also look at their offerings and their strategies and identify areas for differentiation or to develop new product features to stay ahead. This analysis fuels our own innovation and helps us offer compelling value propositions to our customers. The car manufacturer wants to differentiate its electric vehicles from the competition. The analyze the product offerings and the strategies of the competitors, maybe such as their battery technology or advanced driver assistance systems, and the manufacturer can then identify areas where they can innovate and offer unique features or capabilities. This then analysis drives their own product development. Which in turn sets them apart from the competition and meets the evolving demands of customers. Also look at risk management. By looking at the competition, this will allow a business to identify potential threats and risks to their own market position. By being aware of what the competition is doing, a business can proactively develop strategies which will mitigate the risks and respond to the market changes. A restaurant chain wants to assess the potential risks to its market position. By analyzing competitive strategies, the chain can identify any upcoming threats such as new restaurants opening in the same market or changing consumer preferences. This analysis allows the chain to proactively respond to market challenges. They will adjust their menu offerings. They will provide enhanced customer service, they would explore new marketing strategies and thereby maintain their competitive edge. So how do we analyze competitor strategies? Here's an overview of the processes of analyzing competitor strategies. We identify the competitors, we gather information. We analyze their positioning, we evaluate marketing promotion strategies. We assess product offerings and innovation. We also make sure we monitor the pricing and competitive advantage. We track their distribution channels and partnerships, and we anticipate what they're going to do next, their competitive moves. So identifying competitors. You start by identifying your direct and indirect competitors in the market. So direct competitors are those that offer similar products or services to the same target market, and indirect competitors, they may fulfill similar customer needs, although using different solutions. So if you're a fast food restaurant, your direct competitors will include other fast food chains in the same location. And your indirect competitors could say be local food trucks or casual dining restaurants. We then gather information. So we gather information about our competitors from all sorts of different sources. This could be their website, their social media platforms, press releases, annual reports, industry publications, customer reviews, and news articles. Also, you might want to do surveys or interviews with customers, suppliers, or industry experts to gather more qualitative insights. You can analyze a competitors website to understand their product offerings, the pricing, and their promotional strategies. You can also read customer reviews to gain insights into their strengths and weaknesses. Are you what the customers like and didn't like? We also evaluate how our competition is positioning themselves in the market. We look at their unique selling proposition, so called USPs. We look at their brand messaging, their pricing, their target markets, and distribution channels. And then we understand their strengths and weaknesses, and we compare that to our own business. So a luxury hotel might analyze how competitors differentiate themselves through exclusive amenities, personalized service, or their general reputation as a luxury brand. We also look at how the competition promotes their services and products. We analyze their marketing campaigns, their advertising channels, their content strategies, and we look at their social media presence. We pay attention to their messaging, their approaches, and their engagement with customers. We identify successful tactics, and we also identify areas where they may not be doing the full job, where they're falling short. So a software company might analyze their competitive digital marketing strategies, such as their use of SEO. They look at their social media advertising content marketing and reach an engagement of customers. We also study the competitions, products or service offerings. We look at their features, the pricing model, the packaging, and any unique or value added services. We would evaluate their product development strategies, and in this, we would include any new product launches, improvements, or innovations. We would also identify gaps in their offerings or areas of improvement when compared to our own service or offering. An electronics manufacturer might analyze their competitors product features. They look at their pricing tiers and any new technologies as they're being introduced to the market. We would also analyze our competitors' pricing strategies and their pricing structures. We would look at how they position themselves in terms of price, quality, and other differentiators. We would assess their competitive advantage and we'd look at things like cost leadership, product differentiation, or customer service. We would also identify areas where we can differentiate ourselves and offer a better value proposition. A clothing retailer might analyze their competitors pricing strategies, such as whether they position themselves as a premium brand with higher prices or a value brand with lower prices. We also want to know how our competitors distribute their products and services. We would evaluate their distribution channels and their partnerships and alliances. We would look at their presence in physical stores, online platforms, or partnerships with other businesses. Here, we would identify potential areas for collaboration or maybe opportunities where we could reach out to new customer segments. A consumer packaging goods company might analyze their competitors distribution networks, such as whether they have partnerships with major retailers, or if they have their own direct to consumer e commerce platforms. Lastly, we want to anticipate competitive moves. Based on our analysis, we try to anticipate what our competitors future strategies and moves will be. We try and assess their growth plans, any expansions into new markets or potentially disruptive innovations. And we try to anticipate how these actions could impact our business, and we then develop contingency plans accordingly. So a telecommunications company might analyze their competitors announcement for deploying five G networks or expanding into new geographical regions to understand how it could impact their own market share and customer acquisition efforts. 6. SWOT Analysis: Welcome to this lesson on the so called SWAT analysis. We mentioned in previous lessons that we take a closer look at swat analysis, and this is that lesson now. So SWAT analysis basically is a planning tool where we assess and evaluate our internal strengths and weaknesses, as well as look at external opportunities and threats, and this is obviously for a business or say something more specific like a project. The acron in SWAT stands for strength, weaknesses, opportunities, and threats. This analysis will help an organization identify key factors that can impact their success and development strategies to leverage their strengths, overcome the weaknesses, seize opportunities, and mitigate threats. A well conducted SWAT analysis will provide valuable insights that inform strategic decision making, resource allocation, and goal setting. It can help a business capitalize on their strengths, address weaknesses, exploit opportunities, and navigate potential threats to achieve sustainable growth and competitive advantage. The first S, swat strengths. The strengths refer to the internal attributes and capabilities that give a business a competitive advantage. These are factors that set the business aside from its competitors. Examples of strengths could include strong brand reputation, proprietary technology, skilled workforce, efficient supply chain, loyal customer base, or unique product features. So by identifying and leveraging strengths, a business really can capitalize on its core competencies. Let me look at weaknesses. Weaknesses are the internal limitations or area where a business lags behind its competitors. These factors actually hinder the business's performance or could prevent it from reaching its full potential. Weaknesses might include a lack of resources, poor customer service, outdated technology, high production costs, or weak market presence, and identifying the weaknesses will allow a business to address them and improve the areas that need attention. This is where you have to be painfully honest with yourself. M, opportunities. Opportunities are external factors, which are situations that have the potential to benefit the business and create growth opportunities. These could include emerging market trends, technology advancements, changes in customer preferences, new market segments, or some new or favorable industry regulation, or deregulation. By identifying and seizing these opportunities, the business can expand or diversify or gain a competitive edge by capitalizing on these external conditions. Lastly, threats. T threats are external factors, again, that can pose a challenge or a risk to the business success. These could include increased competition, changing market dynamics, economic downturns, disruptive technologies, or unfavorable government policies. By recognizing these threats, a business can proactively develop strategies to minimize their impact and then stay resilient in the face of the challenges. How do we do a SWAT analysis? The process of conducting a SWAT analysis usually has the following steps. We do an internal assessment, and external assessment. We create the SWAT matrix. We develop strategies, then we implement and monitor them. The internal assessment first. We evaluate the internal strengths and weaknesses of our business. This involves analyzing factors such as resources, capabilities, process, and performance indicators, so called KPIs. This assessment can be done through internal data analysis. We can have interviews with stakeholders or we can benchmark against industry standards, but we have to be honest with ourselves. Then we have the external assessment. We look at the external environment to identify opportunities and threats. This could involve analyzing marketing trends, industry dynamics, we look at competitor strategies, customer insights, or general economic factors. The external assessment can be conducted market research, we can look at competitor analysis or industry reports. Then we have our SWAT matrix. We create a matrix or a chart to visually organize the identified strengths, weaknesses, opportunities, and threats. This matrix will help in identifying relationships between internal and external factors, and we'll highlight areas where strategies need to be developed. I was going to include a graphic here with a SWAT matrix, but they're really Sometimes they put them as four segments on a circle, sometimes have four columns, mark, SWOT, There's no magic here. You just list the opportunity in a sort of a key form and use that to go forward. Okay? There's nothing special here. Then we develop a strategy. Based on our swat analysis, we have to develop strategies that leverage our strengths, overcome our weaknesses, seize opportunities, and mitigate or reduce the threats. Importantly, these strategies should still align with the businesses overall goals and objectives. We're not pivoting anything here. Then we need to implement and monitor them. We've implement the strategies, and we continuously monitor the effectiveness of the chosen actions, and A swat analysis is not a one and done, it's a repeated cycle. We regularly assess the analysis, we redo the analysis, and we stay up to date with changes in the internal external environment. If you develop if you identify a weakness, and then you shore up that weakness, it could end up being removed from a future swat analysis. This is a continuous process that you conduct regularly to really keep up to date with what's going on both in and outside of your company.