Identify your customers
To determine the best potential commercial opportunity, and reduce the risk of market failure, develop your idea aligned with the market. The best commercial opportunities are those products or services that are unique, solve an existing problem, and provide an incentive for customers to switch to the new product or service.
Research the market to understand the opportunities, identify the best opportunity, and develop your idea to meet that opportunity. When researching, consider:
- the target market
- what the target customers want
- the size of the market and its growth rate
- the key market trends and gaps
- what life cycle stage the market is at
- the key competitors
- entry barriers
- consumer acceptance
- competitive rivalry
- emerging technology
- distribution networks
- bargaining power of suppliers
- government regulation
- tariff barriers/quotas
- physical environment
- cost structures etc.
- exit barriers
- length of time needed in the market to honour labour contracts
- length of existing leases
- services and parts provided to customers
- government regulations
- social responsibilities to community and workers
- level of emotional attachment to the business or industry
- outside obligations to warehousing or financial institutions etc.
- your competitive advantage
- potential partners.
- Learn more about researching customers.