How much information do you have on your potential markets? Essentials of a Market needs assessment.
The office of the United Nations High Commissioner for Refugees (UNHCR) defines needs assessment to be a systematic investigation of an audience with the aim of finding out individual knowledge, skills, interests, attitude or abilities that are relevant to a particular issue, organization goal or objectives. In this case our interest is Market Needs Assessment (MNA) where we look into introducing a product or service to the market and therefore it becomes important for us to understand the nature of the market one is venturing into.
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The main objective of conducting a market needs assessment is to come up with an effective program, product or service that addresses the need and wants of a given group of people. This can be done before or after the development of a product or even after introducing the product to the market. It is ideal to conduct a market needs assessment during the early stages of product development because it gives one the opportunity to understand the needs of the market thereby enabling them to customize their products based on this assessment. A market needs assessment conducted after the development of a product aims at looking into the most appropriate market for the product and in some instances the possibility of adjusting the product to fit the market. An MNA can also be conducted long after a product has been in the market. This type of market needs assessment is informed by the performance of the product in the market. In this, the aim is to improve the product and is based on the feedback received from the market over the period the product has been out there.
From market needs assessment, you get the “NEEDS” of the market, which is referred to as the gap that exists in comparison to what should be in existence. Wants then are the proposed means to fill the existing gaps. There are three steps invovolved in conducting needs assessment: planning, data collection; and data analysis and reporting.
Planning involves setting the objectives or goals of undertaking the market needs assessment. Develop a list of objectives which will be a guide to conducting the assessment. Understand the issues and the audience. Ensure before embarking on the process of data collection you have an understanding of the audience you intend to interact with and most importantly understand the product that will be the subject of assessment. Undertake a thorough literature review to have an understanding of what you are likely to find in the field. The literature review also gives you information that is useful in developing a tool for data collection. The planning stage is fundamental, this is the stage that sets ground for the assessment, if the details are not well captured and understood at this stage then the rest of the assessment is likely to have a challenge.
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Step two is data collection. The substance of the market needs assessment lies here. Data that relates to the product is collected with the objective of understanding the market in relation to the product which is the subject under study. It is important that the fundamentals of data collection are addressed to ensure there is accuracy in data collection. Select the sample size for the study and design an appropriate tool to fit the selected sample. The research design is fundamental at this stage in ensuring the relevance and accuracy of data collected.
The last stage is data analysis and reporting. This is the stage where assessment of the data collected and analysis is conducted to develop a report. The report should address the objectives as had been set at the beginning of the assessment.
In summary some of the essentials of conducting an assessment are:
- Look into the market from an ideal point of view, before any crisis that could affect it. Were there normal forces of demand and supply that were operating within the market?
- What has been the effect of the market on the larger market for the product?
- Is it possible to predict the behavior of the product in the coming days in the market?
- Identify the interventions in the market that have an effect on it.
- Identify additional market analysis that will inform the design of new market intervention that will boost the sales of the product.
Conducting a market needs assessment is fundamental for any enterprise that wishes to penetrate a market successfully. You need to be informed about your product and about the target market for your product.
By Sarah Makena