How to identify market opportunities and create a sales forecast?
In order to identify market opportunities and create a sales forecast you will need to have information about:
- the size of the market for expected revenues;
- expected performance of the localized website in the new market;
- the buying behavior of your customers.
The great thing about identifying marketing opportunities is the data that is freely available nowadays. This data can help you in getting the above information for your marketing plan.
First determine the size of the market. For now, the focus is mainly on the online revenue opportunities here.
You can use several tools for this:
- Keyword tool
- Search metrics
- Amazon (reviews & merchants)
As you now know the traffic levels of the top players, you will need to get a picture of the size of the market in terms of revenue. For this, the website statista.com is really helpful for retrieving raw data.
One of the most important factors on conversion rate is pricing. However, before going into pricing, you will need to know what selling is. So make a quick 80/20 analysis or ABC analysis of your products, and check out the A-products. You can use Webanalytics again to quickly make an export of your best-selling products and use Excel to analyze the data.
After the ABC analysis, position yourself on the matrix of Porter. Do you have a clear USP (are you unique?), do you excel in costs and how wide is your target group?
Basically it comes down to the question whether you have a cost advantage or whether you (or your best-selling products) are unique. If you are not unique you need to have the same or a lower price. If you are unique, then you have to communicate this properly and more focus will have to be on communication as you will have to explain the difference in the new market and evaluate how much people will be willing to pay more for this.
So in our case it is time to check prices. There are many opportunities to get a rough idea about pricing.
- Pricing Tools
- Google Docs
- Google Shopping
You can use a pricing tool like Metoda to find out about current prices. They match your products with relevant competitors in different markets.
The Value Chain, created by the strategist Porter, has all the elements that effect revenue, margin and, consequently, also conversion rate. Think about USPs, Story, Brand, Price, Material, Production, and Costs. These are all factors of activities shown in the figure below.
For all activities, a decision on how much quality, service and messages you want to give the potential target group has to be made:
- Central or decentral (warehousing) = quick shipment and returns or not
- In-house vs agencies (hire an external agency for a new market or get an internal team who will get your marketing acquisition and merchandizing up and running?)
- Should I offer technical changes to the site, like adding payment methods?
- Should I buy or create products tailored to the market?
- Localization (translations, payment methods)
- Customer support and after sales
- Logistics (shipment and returns).
This is the more qualitative part. If you cannot meet market standards, you need to apply a negative factor on the conversion rate. Therefore, you also need to know the following costs:
- Marketing costs
- Service Costs.
A business plan will not predict the exact future or the exact outcome, but serve as a guideline. When you are in a new market you can check your “actual vs plan” results and see exactly where you need to adjust the business case, where you need to improve your performance or where you will have to do both.
- , Creating a Successful Market Entry Strategy ' <http://www.salesupply.com/media/blog/2015/11/18/creating-a-successful-market-entry-strategy/> (December 2015)