Finding%20out%20about%20Your%20Market

1
Finding out about Your Market

• Purpose of Market Research
• Market Knowledge
• Time to Market
• The Product
• Defining the Market
• Implementation of Marketing Strategy
• Sources of Information
• Preparing for Q A
• Summary

2
Purpose of Market Research

• Targetted Product Design Development
• - the consumer
• - address a specific need
• - impact on established practices
• Product Value
• - Market value
• - Rate of uptake
• - Return on investment
• - Portfolio fit
• Investor Confidence
• - Return on investment
• - Market knowledge
• - Competitor analysis

3
Market Knowledge - Timing

• Requirements for market knowledge at start-up
• depends upon the time to market for different
• sectors.
• New drug discovery 10 - 15 years
• Diagnostics 3 - 5 years
• Engineering products 1 - 3 years
• IT/e-commerce 1 - 2 years
• However, the principles remain the same

4
Product/Market SWOT Analysis

• Aspects to know and understand
• Your product - benefits ( limitations)
• The consumer
• The target market and its potential
• Your competitors current products/pipeline
  products
• The product positioning and USPs
• Follow-up support products
• The market dynamics
• Growing vs Mature vs Declining
• The generic phenomenon
• Tagamet/Zantac effect
• Effect on positioning of company
• Keep a history file with decision tree

5
Product Positioning

• Features versus Benefits
• FEATURES High-tech
• Valuable Intellectual Property
• Novel Approach
• new is Nice
• BENEFITS Consumer/end-user
• Distribution network
• Competitive edge
• CLAIMS Credible
• Proven
• Cost to deliver

6
Product Benefits (Cont)

• Cost Benefit
• If the only clear benefit is cost, project risk
  is
• high, investor confidence will be low.
• Competitive edge lost if
• - raw material costs increase
• - Manufacturing/distribution costs increase
• - Low cost competitor enters market
• - Brand leader reduces price.

7
Define the Market (The niche)

• Our product targets a total world market valued
  at 8 billion annually and at a conservative
  estimate we shall capture 0.5 of that market
  within 12 months
• Our product targets a niche market valued at
  120 million annually, within a total world
  market of 8 billion. We expect to build sales
  to capture 25 of our niche market progressively
  by year 3 with the potential to achieve 40 at
  peak

8
Define the Market
9
Implementation of Marketing Strategy

• 4 Main Options
• Own marketing/distribution Full sales dollar
• Slow penetration
• Marketing Partnership 30-40 of sales dollar
• Rapid penetration
• License-out Lump-sum plus royalty
• Loss of control
• Sell Product Lump-sum
• Considerations
• The added-value chain
• Exclusivity vs non-exclusivity
• Territories
• Variations in value from market to market
• Performance criteria

10
Sources of Information

• Credible public information
• Journals/Newspaper articles
• Internet
• Competitor annual reports
• Questionnaires
• Professional memberships
• Peer reviews ? endorsement
• Company partnerships ? endorsement
• In-housemanaged Focus Groups
• Management experience

11
Sources of Information (Cont)

• Market Research
• A large number of organisations (Internet)
• Connect Pharma, Data-Monitor, FT Reviews,
  Scientific Generics, IBM-Wilkersons, PA
  Consulting, Scrip, Andersen
• Market Research Reports
• Relevance?
• Quick
• Variable cost
• Commission Focus Group Report
• Commission Research
• Customised
• Takes time
• Expensive
• Focussed approach required

12
Preparing for Q A

• Management knowledge understanding
• Market/Product SWOT analysis
• Market intelligence
• Investors portfolio
• Marketing strategy
• Fit with company strategy
• Resources and cost to achieve

13
Summary
Product Concept Product Benefits Customers Terri
tories Competitors Market Positioning Market
Value Marketing Strategy Resources
Credible Market Opportunity
Investment