Let’s be honest—growing a business is challenging. Geopolitical issues, unpredictable markets, and economic uncertainty create real obstacles that leaders must navigate to succeed in these tough times.

The future success of your company depends on your ability to choose the right strategies to sustain growth. It takes significant effort, but we’re here to guide you through the process.

Before we dive in, it’s essential that you have a clear understanding of your company’s direction, resources, strengths, and capabilities. Complete visibility is crucial for making informed, data-driven decisions. Once you have that understanding, you can evaluate the market and assess customer needs to see how well companies are meeting those demands today.

Now, let’s look at how to analyze these factors to uncover your next growth opportunity.

Eight Types of Analysis to Identify Market Opportunities

1. Consumer Segmentation and Behavior Analysis

   Segment your audience based on specific traits. This will help you target the right people in the most effective way.

   Consumer segments can be divided by demographic factors like age, gender, education, income, etc.; geographic factors such as city, country, or region; or behavioral factors like attitudes and lifestyles.

   Demographic and geographic data help estimate the number of potential customers. For example, a baby food company should know the population of infants in the countries where its products are sold. Similarly, an appliance manufacturer would benefit from understanding the number of households in a target market before expanding distribution.

   It’s also important to consider behavioral factors, as they can reveal the motivations behind purchasing your product or service. Price and positioning, for example, can influence these decisions. Since lifestyles, attitudes, and values often drive shopping habits, using behavioral segmentation allows you to tailor your marketing more effectively.

   Keep an eye on both short-term and long-term consumer shifts to understand how priorities are evolving. For example, in recent years, rising inflation has led to more cautious spending. While some consumers have cut back, many still want affordable indulgences.

   Major companies in the food industry have responded by offering premium snacks. Mondelez launched Toblerone Truffles, Mars acquired Trü Frü and Hotel Chocolat, and Nestlé acquired Grupo CRM. Businesses that use consumer segmentation to adapt their products and marketing are more likely to sell effectively.

2. Purchase Situation Analysis

   The buyer’s journey can be complex. Many factors influence when, where, and how consumers make purchases. To influence their decisions, you need to understand these patterns. Consider these key questions:

   – When do people need or want your product or service?

   – Where do they make their purchases?

   – How do they pay?

   By analyzing distribution channels and payment methods, you can uncover buying patterns that help ensure your products are sold in the right places.

   Take the retail sector, for instance. Most consumers today expect speed and convenience, which has reshaped the grocery landscape. Over the past five years, discounters and convenience stores have grown by 28% and 17% globally, while hypermarkets have decreased by 2%.

   Another rising trend is livestreaming e-commerce. Sales in China are expected to surpass $450 billion in 2024, representing 14.5% of total e-commerce sales in the country. This trend is also growing in the U.S.

   By understanding customer buying patterns, you can prioritize where and how to distribute your products.

3. Direct Competitor Analysis

   Direct competitors offer similar products or services. For example, Coca-Cola and Pepsi or Netflix and Hulu.

   Conduct thorough research to understand where your business stands in the marketplace. Identify how major competitors build their edge and position their offerings. These questions can help:

   – Which brands are growing, and why?

   – What is their unique value proposition?

   – How are they marketing their products?

   – What advantage do you have over them?

   Take IKEA as an example. When the company entered Chile in 2022, it likely conducted extensive research on competitors like Sodimac, which had 74 stores in the country. Understanding your competitors’ performance, product portfolios, and strategies will help you find growth opportunities.

4. Indirect Competitor Analysis

   Indirect competitors target similar audiences but with different products. For example, Coca-Cola competes with Tropicana, and Netflix competes with Marvel Comics.

   Studying companies in related industries can provide insights to improve your offerings and reach new customers.

   In the travel industry, airlines could explore capturing market share from buses and trains. Questions like these can help:

   – How many people travel long distances by bus or train?

   – What routes are most popular?

   – How much do tickets cost?

   Similarly, a producer of chocolate spreads should research the performance of jams, honey, and peanut butter to understand their position in the sweet spreads market.

   Analyzing adjacent products also reveals trends. For example, protein snack bars are becoming popular, so yogurt brands have launched high-protein options to capitalize on this trend.

   Reviewing the prices of indirect competitors, like those in the edible oils market, can also inform your pricing strategies. This analysis helps you reach a broader customer base and highlights your strengths over indirect competitors.

5. Complementary Product and Service Analysis

   It’s important to track the performance of products or services that complement your business. For instance, if you sell coffee pods, you should pay attention to trends in coffee machine sales.

   This analysis helps you understand how customers use your products with others, identify new opportunities, and develop products that meet changing needs. For example, a company producing fresh coffee pods can estimate market demand by looking at sales data for popular pod coffee machines like Nespresso.

6. Diversification Analysis

   If your business has matured in its current market, a diversification analysis can guide growth into new categories. First, determine which sectors could benefit from your offerings, then analyze their growth potential.

   EasyGroup, for example, started with easyJet, a low-cost airline, and expanded into other sectors like e-commerce and entertainment. Diversification, when done well, can bring new customers and secure consistent demand.

7. Foreign Market Analysis

   Expanding into new countries can offer growth opportunities if your current market is saturated. Different countries have different rates of economic development, and analyzing these can help determine whether entering a new market is worthwhile.

   Consider factors like local culture, regulations, and competition when planning international expansion. Ask yourself:

   – How should your product adapt to local preferences?

   – Who are the main competitors in this new market?

8. Environmental Analysis

   External factors like international relations, new technologies, and regulations can impact your business. A PEST analysis (political, economic, social, technological) can help.

   Keeping track of scientific developments or regulatory changes can also help. For example, some Latin American countries now require food labels for products high in sugar or saturated fats. Companies that invest in healthier alternatives may benefit from such changes.

Next Steps

By using these eight types of analysis, your business can gain a clearer view of potential opportunities and build long-term strategies. Once an opportunity is identified, develop a value proposition, plan your commercial chain, and estimate costs and revenue.

Remember, not all market opportunities will succeed, which is why companies invest in various types of research before entering new markets or introducing new products.