SCB Networking at the Watershed March 2013 - Sizing the Market Greville Commins
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The document discusses sizing markets for new technologies and products. It notes that accurately predicting market size is difficult as markets can evolve rapidly. It recommends starting by talking to potential customers to understand market needs without revealing your unique business idea. Additionally, it suggests analyzing competitors, historical trends, and using a "lean" approach to test the market and gather feedback. Overall, the document emphasizes getting a realistic view of the market through research while acknowledging forecasts will likely be incorrect. The market ultimately decides how big it will become.
SCB Networking at the Watershed March 2013 - Sizing the Market Greville Commins
- 1. Sizing your market A realistic view Greville Commins Accelerating Technology Businesses
- 2. Not so easy to find the next big market Most of today's killer applications did not exist 10 years ago 50+ killer applications 28 killer 8 applications 5 killer killer applications applications 1985 1995 2005 2015 Source: Malcolm Penn, Future Horizons Accelerating Technology Businesses
- 3. What is market sizing? • Simply put • Number of customers in the market • State of market, mature, growing, decline - trends • Customers disposable income/spend • Flexibility of customers, switch suppliers? Loyalty? • A prediction of Total Available Market revenue • Other factors:- • Demographic, Economic, cultural, Technological, Regulatory, Natural Accelerating Technology Businesses
- 4. Sizing your market a realistic view Is it really possible! To get a realistic, reliable, credible size? The only thing you can rely on is that your forecast is probably wrong The market decides how big it will be! So what CAN we do? On a limited budget..... Accelerating Technology Businesses
- 5. Where do we get our market forecast from? Talking to customers Own market research Analysing competition & alternatives Historical trends & patterns, life cycles Our own gut feel…. Accelerating Technology Businesses
- 6. Looking for the right market segment Value of Products & Markets Services within Category with little competition where profit potential is high Locations, Regions, Populations of Market where you can gain market control at the right point in their life cycle Accelerating Technology Businesses
- 7. Choosing target Market Segments Low Value Value of Products & Services within Category Target segment High Value Locations, Regions, Populations of Market Too Large Too Small Accelerating Technology Businesses
- 8. Segments where your profit potential is high Where • The Total Available Market (TAM) is big, • You can define the number of customers • The cost/time to acquire the customer(s) is definable • You can demonstrate demand for the product Accelerating Technology Businesses
- 9. Markets at the right point in their life cycle • At what stage is your chosen market? Market stage Growth Maturity & saturation Introduction Decline time Geoffrey Moore: Crossing the Chasm Accelerating Technology Businesses
- 10. Markets at the right point in their life cycle Is there more growth potential to come? Time (years) to reach 50Million? • Radio = 38 • TV = 13 • Internet =4 Markets are changing all the time • iPod =3 • Facebook =2 The evolution of technology & The human race www.youtube.com/watch?v=JcSzqm5Whwc Accelerating Technology Businesses
- 11. You need to do some market research Ask/survey potential customers Announcements from potential competitors Run trials, tests, sampling Research the web, press articles Independent sources Use your own experience Accelerating Technology Businesses
- 12. Getting accurate market numbers Accelerating Technology Businesses
- 13. Getting accurate market numbers Accelerating Technology Businesses
- 14. Market numbers don’t just make them up! Accelerating Technology Businesses
- 15. Things you can assume The real value in freely available information is hidden away and can be hard to find People (potential customers) don’t want to give away their knowledge for free/easily Even when you pay for information it can be of questionable value Everyone avoids customer surveys..... Accelerating Technology Businesses
- 16. Talk to potential customers First establish why people should talk to you Form a discovery list of questions You need to check/validate market Collect over multiple sessions Ensure you get meaningful data Consult key figures Use “Cascade” Networking approach Experienced people in the industry, academics, consultants. Potential customers – get their feedback Accelerating Technology Businesses
- 17. The “Lean” approach A faster way of initiating a business. Get product into customers hands sooner Product is what customer needs Also a good way of doing market research Test the market, validate need Gauge reactions, get feedback Engage with potential customers, ask questions Measure demand Accelerating Technology Businesses
- 18. Interesting web sources Gather information from independent sources industry pundits and influencers (articles, blogs, tweets) analysts market research companies Trade show materials government reports, www.gov.uk, www.official-documents.gov.uk Accelerating Technology Businesses
- 19. Interesting web sources Announcements from key market players Competitor/Customer web sites Investor relations pages Press releases/articles Google images Accelerating Technology Businesses
- 20. Investor relations pages Publicly quoted, companies must give shareholders insight into the company’s activities. Inside their web sites Look for investor relations sections where you will find • Financial reports • Future strategy • Market forecasts • Shareholder meeting presentations Accelerating Technology Businesses
- 21. Finally What’s the1st rule of Fight Club? Accelerating Technology Businesses
- 22. What’s the1st rule of Fight Club? ….don’t talk about Fight Club Don’t reveal your new idea when talking to potential customers…. Instead: Verify your understanding of the problem Do not reveal your unique business idea! Accelerating Technology Businesses
- 23. Thank You Greville Commins Accelerating Technology Businesses