100% Market Share

October 23, 2006

Dream on…. but how much share is reasonable? When starting a business or adding a new product or service line, one critical step in the planning process (and, indeed, in the decision to enter that market) is how much share of that market can you acquire. Let’s start from the beginning:

1. How big is the market? Is the market growing? At what rate? Why… what is driving the growth and is it likely to continue? For how long?

2. How is the market structured? In the area of the market in which you believe you will compete, how many competitors are there and what are their individual shares? If you are going to enter the Automobile business, will you enter as a sub-compact and seek your market at the “low end” of the pricing model? If yes, which Companies/Brands are already competing in that market niche?

3. Which potential competitors are growing or declining and why?

4. What are these competitor’s strengths and weaknesses? And, will your Company have a unique competitive advantage which is sustainable against these competitive offerings?

5. Will your new product grow the overall market? (A key question for retailers who may carry your product). If yes, by how much? And, how much will your product take from each competitive brand?

6. Will your projected market share yield a large enough business to support your business model?

Naturally, as you can see, choosing the markets in which you will compete is a critical component of your ultimate success… A great product is not enough…..

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

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