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:

• Understand potential market opportunities

• 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

Where trends and forecast information already exist, the first goal is to track down relevant insights before validating and synthesizing the data into a cohesive narrative that provides actionable intelligence.

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

The following case study involves a clothing company that needed to know industry trends and forecasts for the U.S. maternity wear market.

The first step was to identify key trends in the industry, including those that were established, gaining traction, or in the nascent stages. The aim was to provide a complete portrayal of the market to ensure our client was informed of any potential disruptions to the market landscape. For example, this could include signs of merger and acquisition activity or the growing role of “Millennial moms.”

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

Changes that seem relatively minor today can turn into structural shifts in the future. Whether it is an industry in which a company is already vested or a potential new market, Wakefield Research’s Market Intelligence will ensure you stay informed.

To learn more about market intelligence, quantitative and qualitative research, contact Wakefield Research today.

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