PHASE 1: MARKET SEGMENTATION
Divide the broad target market into subsets of buyers who have common needs, priorities and solution options.
Identifying markets where you will have a competitive advantage will fuel the growth of your business. With Market Segmentation, only the markets that are attractive to meet your corporate strategic objectives with be the focus of our collective efforts. Mature, low-growth markets where products have little opportunity for differentiation will be de-prioritized. And by focusing on growth markets, the idea opportunities will be captured.
1. You have identified your Total Addressable Market (TAM) and know its growth rate.
2. You have identified all possible segments with your TAM and have prioritized the high-growth markets you will target.
3. Each quarter, you assess your % penetration rate and growth rate as compared to the growth rate of the addressable market.
4. Your competitors in your TAM have been identified and you actively track their market share gains or losses.
5. You actively monitor and compare your company’s performance to the growth rate of your industry.
6. You have identified the traditional and innovative routes to market in your TAM and are actively working to grow market share.
7. You know your Customer Acquisition Cost (CAC) by product and by market.
8. You know your Customer Lifetime Value (CLTV) by product and by market.
9. For each market segment, you know which channels your target buyers prefer to buy your products (e.g., direct field sales, direct inside, global account management, key account management, distribution, multi-tier distribution, VAR, systems integrator, ecommerce, telephone, web, retail).
10. You conduct routine research that identifies market problems (by problem, you know the frequency, level of pain the problem causes, and the willingness a buyer has to fix the problem).
• Market Insights and Trends
• Competitive Analysis
• Industry Growth Analysis
• Market Segment Definitions
• Market Attractiveness Criteria
• Market Adjacency Identification
• Total Available Market (TAM)
• Market Share Analysis
• Market Problem Analysis (frequency, pain, willingness to fix)
• Product Win Strategy