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Market Research on the Net
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| What
Do You Want To Know? |
For this example, we will try to learn what we can
about: The sales potential for premium men's underwear
in the Dallas, TX area.
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Start With the Best Data You Can Find
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Can we find the target market data we want?
No.
Think that's a dumb question? Not so. Recently I received
an email from a market researcher who was doing a study on the
sales potential for premium men's underwear in the Dallas, TX
area. No kidding. I had done this page as an example for a class
on entrepreneurship but he was doing the real thing for a client.
He said he'd found useful sources on the page and suggested
a few that I'd missed but the point is this: the Net is a big
place and you might find that the exact information you're looking
for is already out there. It's worth doing a little searching.
Can we find national market data to scale? Not exactly
Can we find related national maket data from which to infer the
desired market data? Yes.
U.S. Retail Apparel Sales (from American
Apparel and Footwear Association)
- Production (wholesale prices)
- Domestic Production: $33B
- Men's Apparel Production: $11.4B
- Imports: $68B
- Exports: $5B
- Total for US Market: $96B
- Domestic-to-Total Production Ratio (Domestic/Total): 33/96 = .3
- Consumption (retail prices)
- Total Apparel Consumption: $269B
- Men's Apparel Consumption: $96B
- Average Markup (Total retail - Total wholesale) / Total wholesale: 1.8
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Infer The Data You Need |
U.S. Domestic Production of Underwear: $1.3B
- Total Wholesale Underwear (assuming same Domestic-to-Total ratio as above): 1.3/.3 = $3.9B
- Retail Underwear Sales (assuming same markup): $3.9B * 1.8 = $7.0B
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Scale National Market to Target Market
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What fraction of $7.0B Mens Underwear
sales is in Dallas?
Using Local
Area Personal Income Data from the Bureau
of Economic Analysis at the U.S.
Department of Commerce
- Personal Income (U.S.): $8,703B
- Personal Income (Dallas Metropolitan Area): $182B
- Buying Power Index: $182B/$8703 = 2.1%
- Mens Underwear Sales in Dallas: $7.0B * 2.1% = $146M
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Refine Target Market
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Number of Mens Stores in Dallas from GTE
SuperPages
Mens Apparel Stores: 136
Department Stores: 315
Total Retail Mens Apparel Stores: 451 Average Sales: $146M
/ 451 = $324K
- Premium Mens Underwear will only be offered through the best
third of the stores:
451 / 3 = 150 stores
- Total sales from target stores:
150 * $324K = $48.6M
- Goal is to capture 75% of the target market:
75% * $48.6M = $36.4M
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Profile Customers
Demographics
Psychographics
Talk to prospects |
Describe your buyer in as much detail
as possible. This will help in writing ad copy, and tell which
neighborhoods are most promising for promotion and product placement.
It may also help in designing a more appealing product. Also consider
which other products may appeal to the same buyer.
Take note of how competitive lifestyle brands market their premium
underwear products such as Joe Boxer, Fossil, Playboy, Nike, Calvin
Klein, Versace and others.
Demographics
- Age
- Income
- Married
- Children
- Zip code
Psychographics
- Stage in life (single, full nest, empty nest, etc.)
- Interests, hobbies
- Motivations (status, principles, etc.)
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Assess Competition
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©2005, Harry Tennant & Associates |
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Have a question? Send us a note at askhta@htennant.com.
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