Market Trends & Forecasting
What Is Market Trends & Forecasting
Gauging the current state of a market can be useful, but it is often more important to understand where a market is heading.
History is littered with examples of companies, even industries, that have made serious strategic errors due to inaccurate or incomplete forecasts.
A crucial element in this type of Market Intelligence research is distinguishing what information is impactful and what is simply noise.
Market Trends & Forecasting Research Helps:
• Identify changing market conditions and their impact
• Evaluate, formulate, and validate business plans
• Understand how the capabilities within a market align to a business’s objectives
• Stay updated on emerging trends and market dynamics
• Consider independent, objective perspectives when formulating business strategies
Market Forecasting Methodology
In some markets there may be no existing information. Therefore, a trends and forecast analysis will have to be built from the ground up.
The objective of a trends analysis is to provide a platform on which market projections can be made. An example market trends analysis may involve examining the following areas:
• Economy: interest rate changes and growth factors
• Customer needs: increasing or decreasing product usage
• Demographics: trends in home ownership
• Technology: increasing use of cloud computing
• Pricing: a trend for discounting
• Global factors: changes in the economic outlook
• Cyclical: how housing market demand will impact construction activity
• Social factors: changes in social behavior such as online networking
• Communication/Media: increased use of social media by competitors
Market Trends & Forecasting Case Study
In determining a market forecast, Wakefield identified the key inputs into the market dynamics. In the case of U.S. maternity wear stores, key trend inputs included:
• Birth rate
• Per capita disposable income
• Product preferences, such as appetite for premium offerings
• External competition from growing share of online purchases
• Trends in the number of maternity wear establishments
These factors were analyzed to determine their potential impact on the market. Once the current market size was determined, a forecast could then be calculated. Ultimately, any useable forecast model must include logical assumptions and be devoid of any “black box” calculations.
Trends Change Quickly in a Market
To learn more about market intelligence, quantitative and qualitative research, contact Wakefield Research today.
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