Every business, regardless of the product or service, is unique. Standing out from competitors is an important strategy for startups. At the same time every industry experiences trends that drive sales and interests. Here are ways that an enterprise can benefit from analyzing trends.
Conducting an Industry Analysis
The main purpose of doing an industry analysis is often to compare the financial health of the industry as a whole with the company's financial development. The analysis begins with reviewing reports then studying supply and demand conditions. Deeper study involves evaluating competition and industry dynamics, as well as recent industry news that might have a long-term impact.
A major advantage to an industry analysis is that it will put a company in touch with data that can potentially reshape and refine its business model. It can provide a competitive edge over companies of the same size that are not as aware of economic conditions and consumer demand.
Another type of report that can provide a wealth of knowledge is a market trend analysis, which covers data on consumer behavior, surveys on consumer perception of value and trends in cost drivers. Ultimately, the more an enterprise knows about its target market, the more it can refine its model toward customer needs.
Understanding competitive advantages in the market is key to predicting trends. It's possible for a small new company to enter and disrupt a market by offering a superior solution at a lower price. An investor thinking of entering a market can benefit from studying reports that indicate whether there is ease of entry in the market.
In order to get an objective view of what the dominant trends are, it helps to collect
as many reports as possible. Trade publications and articles from industry influencers provide a wealth of information for analyzing trends. An effective strategy for collecting data is to network with industry colleagues who have access to reports.
There's a big difference between a company that only looks at its own financial conditions and one with a broader view of the market. Managers who can identify trends early can help a company ride trends. A trend that regularly comes and goes is one that rewards consumers who act as promoters. Consumers also have a growing interest in sustainability products such as plant-based Young Living Essential Oils.
Aside from reviewing charts, business leaders should always anticipate change as a predictable constant. This mindset of anticipating change allows someone to think ahead like a chess player. Through anticipation, one is likely to spot a trend early as it begins to gain media coverage. Industry analysis further opens the door to spot ways to capitalize on trends.
Short-term vs Long-term Trends
Business managers can learn a great deal about their markets by studying supply and demand data. The quality of customer experience plays a significant role in shaping demand for a specific brand. A company that has the ability to spot long-term trends can increase its revenue streams.
Sometimes it's difficult to tell the difference between a short-term trend and one that will be around for years. When the iTunes Music Store launched in 2003, it seemed like the trend of downloading music would last forever. It turned out the paid download trend was dominant for a little more than a decade before streaming became more popular.
Many times short-term trends are reactions to news stories or the overall economic picture. Products that are specifically marketed to young people tend to have a more trendy nature. Long-term trends, such as cloud computing, are often the result of solutions that offer widespread utility and efficiency. The cloud, for example, has cut costs enormously for startups on hardware and maintenance.
There are plenty of online tools and resources to use for evaluating markets. The Bureau of Labor Statistics is useful for estimating the size of a market. It also provides demographic information on employment, as well as the geography of consumer spending.
Learning from market trends is essential for entrepreneurs planning on business growth. Gaining access to industry data and studying trends helps an enterprise achieve a competitive edge. Routinely monitoring trends will help a business streamline its products and services more toward customer demand.