Let’s face it. Growing a business is hard. Geopolitical tensions, market volatility and economic uncertainty are real challenges that executives must navigate to thrive amid the upheaval.
Your company’s future success depends on your ability to determine which strategies will sustain growth. It takes considerable effort. But we’re here to help you get there.
Before we get started, it’s important for you to have a deep understanding of your company's business direction, resources, strengths and capabilities. Then, you can evaluate the market and assess consumer needs to understand how those demands are being met by companies today.
Now, let’s examine how to analyse those factors to ignite your next growth opportunity.
8 analysis types to identify market opportunities
1. Consumer segmentation and behaviour analysis
Divide or group your audience based on traits. This will help you target the right people in the most effective way.
Consumer segments can be broken down by demographic (age, gender, education, income), geographic (city, country, region) or behavioural (attitudes, lifestyles) variables.
Demographic and geographic data help you estimate the number of potential customers. For example, a baby food brand should know the current and future population of infants in countries where its products are sold. Or an appliance manufacturer might want to understand the number of households in a target market before expanding distribution.
You should also consider behavioural variables because these indicators help pinpoint purchase motivations associated with your product or service. Price or positioning, to name a couple, can be influential factors. Lifestyles, attitudes and values often drive shopping decisions, so behavioural segmentations help you tailor your marketing efforts.
You’ll want to monitor short- and long-term consumer shifts like megatrends to understand how priorities are evolving. Wellness remains a top consumer trend and purchase driver. Major food and beverage players are expanding portfolios with health-orientated products in response to this behavioural shift. PepsiCo acquired prebiotic soda brand Poppi, and Mondelez launched gluten-free Oreos in Argentina.
Organisations that use consumer segmentation to tailor their messaging, marketing and products will sell more effectively.
2. Purchase situation analysis
The buyer’s journey is anything but straightforward. A multitude of factors can impact what, when and where consumers make purchases. Here are some questions you’ll want to answer:
• When might people need or want your product or service?
• Where do people make their purchases?
• How do they pay for your product or service?
Look at distribution channels and payment methods to start uncovering buying patterns and opportunities. This enables you to reach your customers with the right products in the right place at the right time.
Let’s dig into the retail sector as an example. Today, most consumers expect affordability and convenience, which is transforming the grocery landscape. In the last five years, the number of discounters and convenience retailers globally grew by 36% and 15%, respectively. But the number of hypermarkets declined by 4%.
Analysing potential consumption occasions is also essential to tailor product formats or attributes. For instance, several yoghurt brands identified a growing demand for healthy, on-the-go snacks and launched pouch formats in response.
A clear analysis of consumer needs across the buying journey—including channel and payment preferences—helps you make informed decisions about your commercialisation strategy.
3. Direct competitor analysis
Direct competitors offer similar products or services. For example, Coca-Cola and Pepsi, or Netflix and Hulu.
Conduct comprehensive research on where your business stands in the marketplace. You should know how key players are building a competitive edge and positioning their products or services. Then, find out how these companies size up against your business. These questions can help you get started:
• Which brands are growing and why?
• What is their unique value proposition?
• How are they approaching innovation?
• What competitive advantage do you have over them?
For example, in salty snacks, Takis introduced its spicy snacks in Mexico in 1999. Over the years, consumer demand for bold, adventurous flavours grew, leading to a surge in spicy-flavoured SKUs across the market. Now, major brands like Pringles, Doritos, Lay’s and Cheetos have significantly expanded their spicy offerings.
Understanding your competitors—from performance to product portfolios and new product development (NPD) to strategic direction—will help you identify growth opportunities.
4. Indirect competitor analysis
Indirect competitors target a similar audience but sell different products that satisfy the same needs. For example, Coca-Cola and Tropicana, or Netflix and Marvel Comics. Analysing companies in tangential industries or categories can help you improve your offerings and reach new audiences.
Let’s use the travel industry to bring this to life. Airlines could look for opportunities to capture share from other modes of transport. The following questions start to uncover white space:
• How many people travel long-distance on buses and trains?
• What are the most in-demand routes?
• How much do travellers pay for their tickets?
• What is the occupancy rate of long-distance buses and trains?
• How can we persuade a current bus or train passenger to travel by plane instead?
Similarly, producers of chocolate spreads should research performance and pricing of jams, honey and peanut butter to understand their competitive positioning within the whole sweet spreads market.
Attributes of adjacent products give you insight into market opportunities as well. You should keep up with NPD launches of your indirect competitors to inform your innovation plans.
This type of analysis helps you tap into a wider customer base and reveals your value proposition compared with indirect competitors.
5. Complementary product and service analysis
You should monitor the performance of products and services that complement your business.
That means sweet spreads and butter brands should analyse market trends in bread and savoury biscuits. Another example: tomato sauce manufacturers monitoring performance of pasta.
This research helps you:
• Understand how your customers use your product in conjunction with others
• Detect new needs, opportunities and threats
• Develop new offerings or redesign your products
• Sell more effectively
Let’s say a company that produces fresh ground coffee pods wants to expand retail distribution. Sales data on pod coffee machines like Nespresso and Dolce Gusto can estimate market potential and demand.
Trends in complementary sectors should be considered when making investment decisions. Use this information to guide your product innovation strategy and gain market share.
6. Diversification analysis
If your company has reached a high level of maturity in your current market, a diversification analysis will help you understand how and where to grow. But you must have the right skills, resources and business models to successfully expand into new categories.
First, analyse any sectors that could benefit from your offering. Then, quantify the growth potential and understand the competitive landscape for each. Look at market sizes, shares, growth rates, unit prices, per capita sales and brand positioning. You’ll want to answer these important questions before making investment decisions:
• Do you have the capacity and tools to diversify?
• Do you have applicable resources in other industries, and could you gain economies of scale?
• Will diversifying dilute your brand reputation? Should you use a new brand in this new industry?
• Do the potential financial gains outweigh the risks?
Mergers and acquisitions are valid options for business diversification—when sufficient financial resources are available. In August 2024, Mars announced the potential acquisition of Kellanova for nearly USD36 billion. The acquisition would strengthen Mars’s position in high-growth categories and aligns with its strategic focus on health and wellness trends.
Diversification can bring in more customers, income security and consistent demand when executed successfully because your company transforms alongside consumer needs.
7. Foreign market analysis
If your company operates in a mature or saturated market, exploring other countries could help you achieve your financial goals.
Different countries grow at different paces due to disparities in economic development and local habits. The evolution of per capita consumption for a given product in each country can serve as an indicator of product lifecycle maturity. Understanding the size of the market and competitive landscape will help you estimate business potential.
For instance, many global companies are turning their attention to emerging regions due to stronger GDP growth of developing markets compared with advanced economies in recent years.
Local cultures, regulations and competitors must be considered before expanding into new markets. Helpful questions to ask are:
• How does your product need to adapt to local preferences or legislation?
• Who are your main competitors in this new country?
• Are there seasons or local festivities when your products could be in higher demand?
These questions must be addressed when planning international expansion.
8. Environmental analysis
Don’t forget to analyse external factors like international relations, scientific developments, regulations and environmental shifts that could impact your business. A PEST (political, economic, social, technological) analysis is useful here as well.
Generative AI has moved up the corporate agenda. According to Euromonitor’s Voice of the Industry Survey 2024, 55% of professionals expect generative AI to impact their business within the next five years. Companies can embrace this new technology to facilitate business growth.
Regulatory framework changes can impact your business, too. For example, recent policy changes from the US, the world's largest economy and biggest importer, are having a strong impact across the globe. President Trump's policies on tariffs, taxation, spending, regulation, migration, AI/tech and energy are reshaping the global economy and key consumer industries. Businesses must understand the implications to respond and adapt in this rapidly changing landscape.
You’ll also want to evaluate possible economic scenarios to plan for potential disruptions or risks. Paying attention to these elements will help you assess market attractiveness.
This type of analysis should be ongoing. External factors change every day. But this research will help you stay resilient amidst volatility.
Next steps
Using a mix of these eight analyses will help your business gain a holistic view of opportunities and create long-term strategic business plans. Remember: not all market opportunities identified will succeed. That’s why companies invest in different types of research before moving into a new market or making changes to a product.
Now, are you ready to spot your next market opportunity? Connect with us to get the data and insights you need to conduct these analyses for your business strategy.
Editor’s note: This article was originally published in June 2017 and has been updated.