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Why You Should Do An Industry Research

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Why Industry Research Matters?

Many times, promoters of new ventures ignore the trends that are happening in the industry on a global and national scale. They fall so much in love with their business idea, that they get short-sighted and see only the opportunity at hand. This can lead to very sad consequences. Imagine spending millions on a venture that gets disrupted by new technology or a shift in customer preference, and the venture goes out of business. If only the promoter had the common sense, to look up to the industry and see a Tsunami coming, he could have spent that millions of investment, his time, and effort on something that had a better prospect. 

This is applicable to those managing businesses at the moment. Before embarking on major re-investments or expansions, you need to study the future of your industry. If it has disruptions coming up, better shift that investment and effort, to something that has better prospects.

Doing research on your industry is not all about preventing a disaster from happening. It can also be a good means to identify new opportunities.

5 Reasons Why You Should Do An Industry Research

Industry research helps in changing ahead of your competitors.

It is common sense that you need to do things your competitors are not doing to stay ahead of them. Sometimes, these new measures or initiatives may not be things that can be done the next day. Especially if it involves substantial investment into say production, infrastructure or new training and grooming of staff etc.
So if your business is able to find a new disruption on the horizon, and you take the time in advance to invest and be prepared for it. Then when it happens, your business will be ready for it, while your competitors will need months to be in your position. By this time, you can capture their market share.
When consulting new ventures, we at AASC, ensure we do Industry trend studies in our Market Feasibility Studies, to ensure that such opportunities are not missed. Also when providing management consulting services to existing businesses, we do a process called Market Audit, where apart from studying the market, competitors and the customers of the client, we also study the developments in the industry to provide apt advice for the present and future.

Industry research helps in becoming a market leader

To know where the market leads and by acting on the clue, means naturally becoming the pioneer and the market leader. 

Industry research helps in better branding

Becoming a market leader, a pioneer or a thought leader creates a strong brand image among the target customer segments. It also makes the competitors identify your business as an industry leader.

Industry research helps in better understanding customers

Industry trends are usually triggered by customer changes or technological changes. Or industry changes triggered by customer preference changes, triggered by technological changes. Understanding these changes in customer segments or preference, helps in better communication, promotion, advertising, implementing internal changes and host of other important preparations. 

AASC assists businesses in these changes by studying these trends, and analysing its impact on the business and making strategic and tactical recommendations. And assisting your business to implement and manage the implementation of the recommendations.

Industry research helps in the diversification 

Industry research reveals the possible changes that can result from factors affecting the industry from technology, politics, climate, laws and customer preference changes. Every change is an opportunity. It’s about a river changing its course, not drying up. So knowing the industry trends means identifying new opportunities and diversifying into those areas. In certain cases, such opportunities can be beyond the capacity of your business (technological, knowhow, resource or capital constraints). In such cases, the diversification can be to a totally different industry. 

AASC is a Business Strategy & Management Consulting firm that serves Promoters to study, plan and set up new ventures, and Entrepreneurs to manage or grow their business, in a professional manner. 

To know more about AASC services for new ventures, please visit https://aascglobal.com/consulting-for-new-ventures-and-startups/

To know more about AASC services for businesses, please visit https://aascglobal.com/consulting-for-business-growth-and-expansion/

Call: +91-7558-900-800 or email info@aascglobal.com

Location Does Matter

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One of the biggest mistakes that promoters make, is falling in love with a business idea and believe that the idea will succeed no matter where it’s based.

Many a time, entrepreneurs start businesses they “think” people want, and get so hyped up about it. So much so that, if they didn’t get the right place, they start anywhere available, believing that customers will come to them. And that might not actually happen. The business fails.

Promoters spend a lot of time, sometimes even years, trying to find that one big idea that will click. A business idea is an opportunity that has potential in a market. But having a ‘Eureka’ moment is not enough to jump-start it as a business. 

For a good business idea to win, it has to satisfy several criteria. In this post, the ‘Location’ is our topic.

What is the point of starting a business where there are no target customers? That is why, when it comes to location, the right market has to be selected. So what is a market? It can be a village, a city, a district, a region or a state, or even a country or several countries. But it needs to have the target customer segment in it.

Once the market is selected, comes the second step. The exact location of serving the clients. This is specifically important where customers or clients have to physically visit the premises. 

The location in the market is crucial. It has to be located where it’s closest to the target customer and is easily accessible and visible to them. That is the reason why shops that are based in the right street but the wrong building fails. Or based in the right building but the wrong floor fails. Or based on the right floor but the wrong area fails. Or based in the right street but wrong visibility fails. It’s a very important matter and it’s a shame when a great business idea fails just because the location was not right.

So why do entrepreneurs make this mistake when it sounds like common sense? Several factors can play here.

One reason is the non-availability of space in the ideal location. In which case, we as Management Consultants would advise not to start now and wait for the right location to come up, or move into another market where the right space is available.

The second reason is the high rental of the properties in the right location. This is a tough reality and one has to be careful here. When faced with such a situation, the entrepreneur has to evaluate how much rent is viable for the business. This might be complicated for most entrepreneurs. In such cases, it’s ideal to engage management consultants or management consulting firms (like AASC) to do a detailed analysis on the financial viability of the location, and check if that rent is viable. Sometimes, a location that has high rent can still be a profitable option.

The third reason can be impatience to do a proper study. Promoters or entrepreneurs can fall in love with an idea, that they simply want to start ASAP. They get hold of the first property and launch the business there. And as the days pass by and they witness lower footfalls, they realize that the location or the building or the floor is not ideal for their customers. Here we as management consultants, always ask our clients to take it easy and do a proper study. In fact, a typical study at AASC takes about 2-3 months to complete. With the market study taking about 30 to 45 days. With such a detailed study, the pros and cons are evaluated before making a final verdict of not just the location but the business itself. 

The fourth reason can be overconfidence. The illusioned belief that the product or service that the entrepreneur intends to provide to the customer is so much in demand, or the price is so attractive or the quality is so high that the customer will seek them, no matter where they are. In most cases, it does not work. And the business goes belly. But in some rare cases, it can work- for some time. This is when the customers really do need it and they take the pain of reaching you despite the trouble or the inconvenience. But the moment a competitor starts the same business in a more ideal location, all the customers will move to him. Why? Customers are not loyal to any shop or brand, they are loyal to those who provide them what they want, when they want, where they want it, and in the way they want it.

Conclusion:

Don’t kill a beautiful business idea by starting it in the wrong place. This is applicable not just to retail outlets, it’s applicable to any business be it manufacturing, hospitality, service, or education. Even online businesses, have to be careful of the locations they choose. And another place to watch out for is the location in Search Engines, as customers use it to search for businesses. If it’s not on the first page, it’s not in a good location online.

It’s always recommended to start a business after a proper study. Do good market research, select the right business model, design the right management plans and systems and assess its financial feasibility. And since entrepreneurs might get emotionally inclined towards their business idea, and because in most cases promoters are not trained to do these works professionally… it’s better to engage professional management consultants like AASC (aascglobal.com)

So location does matter.

Know your customers

The Different Generations in Market & Why They Buy

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It is a wrong strategy to sell everything to everybody. Our products and services have to be customized to the needs of specific customer segments. Each customer segment has different needs, different pains, different jobs that need to be done, and different aspirations.

They are NOT SAME, hence what they need is NOT SAME.

So what happens when you sell the same to all customer segments? They will buy from you as long as they don’t have an option. And switch to a competitor the moment the competitor arrives with customized service or products. That’s the story of “successful” businesses having sudden death.

A study by McKinsey found some interesting insights about what drives consumption among each generation. And it’s worth knowing.

Consumption is viewed differently by each generation. For example, Generation Baby Boomers (born between 1940-59, those aged now at 60 to 79) viewed consumption as an expression of ideology (influenced by the global political turmoil of those times).

Generation X (born between 1960-79, aged now between 40 to 59), views consumption as a symbol of status.

While Generation Y or more popularly known as Millennials (born between 1980-94, now aged between 25 to 39), views consumption as an experience.

The youngest generation, Gen Z (born after 1995, that is aged below 25), views consumption as a search for truth. Their search for authenticity generates greater freedom of expression and greater openness to understanding different kinds of people and views.

So What Does It Mean To Your Business?

As an entrepreneur, you need to know who your customer should be. Which generation they belong to. And what prompts them to like your business and why they will buy from you.

Avoid targeting everybody. It doesn’t work long-term.

Now you know why they buy. Customize your business accordingly. The drive ahead is profitable but never easy.