The opportunity in front of you and its value, 5min
read.

So this is an exercise we have run for several clients who wanted certainty
on the size of a market they wanted to enter into with a new product/
service or to gather more internal budget/ external investment for existing
products/ services.

At the same time they wanted to get a strong feel of its revenue potential
for them.

Off the bat this may seem like a lengthy and costly exercise, but the reality
is very different.

Here is how you do it. I am afraid this only applies to consumer brands
though.

1.So first you need to have a sense of the demographic you may be
targeting and some of their characteristics. Ie age, sex, income bracket and
anything else that will help you buy the most appropriate data.

2. Once this is done you will want to set up an email survey asking a range of questions around the likelihood of usage and purchase. For clients we have also included questions around what they would pay, frequency of purchase and other factors. Ideally, you will want 1000 responses so the data is scientifically sound.

3. You will then want to identify using secondary sources how many people in a given territory ie the UK make up demographically the target audience.

4. Run the survey and gather the results. In setting up the survey make sure you can cross tabulate the data. If you don’t know what this means I will explain in a mo.

5. Analyse the data. So with the data received we really only wanted the opinions of those that would definitely buy and use the product. So within the data we then only looked at their responses to the remaining questions. This is cross tabulation i.e. being able to cross reference different data responses.

But what might the data then show? Here is a flavour of what it might show.

UK target audience Universe: 5,000,000 people % of respondents that on a scale scored a 5 ie they would highly likely buy and use said product = 20% ie 1,000,000 people are highly likely to buy the product

Frequency of purchase per year: Average of 3, again responses only taken from those highly likely to purchase

So thats 3,000,000 potential sales per year

Pricing analysis then showed they would pay £6 for the product. So the market revenue potential per year is £18,0000,0000 per year.

From here you can forecast potential market penetration based on marketing effectiveness and other factors.

We have seen that this kind of data used to secure internal budgets and external investment.

This with qualitative research to understand the current research and buying process of a target audience provides a rich view of market potential and how best to appeal to a target audience.

Hope you found this useful.

We help our clients gather insights to improve their services, marketing, UX, CX and pricing. If you need a hand get in touch and we can discuss your specific problem and will then provide feedback on how we would help you resolve it.