An accurate industry analysis is the bottom logic when a company develops a strategy, conducts a consulting project, does market research, founds a company, or an investor looks at a project. Sometimes we need to conduct in-depth industry analysis, using different analytical tools, and sometimes we need a Quickly Research, but in either case, a core demand of analysis is:
Accurate results, which can give a guiding conclusion.
Since different starting points lead to different levels of industry analysis, I've tried to summarize a logical framework that includes the elements I think are important and the conclusions that need to be examined at different stages of the analysis. Of course, no business practitioner wants to be limited by a framework, the most important thing is to have a logical framework for their own thinking, only proficient in the 18 martial arts of various weapons, in the face of different opponents to know what moves to play which kind of knife.
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Overall industry research
You can also be called "industry research", now is a business era in the segmentation of the competition, but the industry environment of the study can not be discarded, some companies will have been adhering to the depth of the vertical segmentation (Lao Gan Ma), the focus on hot sauce and snacks. Some companies will always stick to deep vertical segmentation (Lao Gan Ma focuses on hot sauce and snacks), some companies will choose to start from the segmentation to expand to the big market (DDT from the taxi market to the big travel market), and some companies will choose to cut into the segmentation from the big market (GUCCI cuts off the redundant product lines and focuses on the leather goods)
There are three main goals here:
a. Understand the basic information of the industry (size, growth, leader, share)
A.
b. Preliminary understanding of the upstream and downstream of the industrial chain and the value chain
c. To make certain trend forecasts and judgments
You can carry out basic research in accordance with the following "set of rules":
1. Collect industry-related data
First, start with the most basic data.
First, start with the most basic data, it is recommended to find more than two related reports and more than three related reports. If you want to collect channels, you can use some websites to analyze the research reports of different industries (eViews, Penguin, Ai Rui, New Third Board Online, Ali Research Institute, etc.).
The basic information can be very extensive, but also quickly get the focus, then these data are definitely needed: market size, growth and the market share of the leading companies.
Market size: whether entrepreneurs or investors, are very concerned about the issue of market size, which directly determines how much revenue the enterprise can get, how many companies can be accommodated;
Growth rate: this piece of information to explain the average growth rate and compound growth rate, relatively speaking, the compound growth rate of the data is more suitable for understanding the development of the enterprise for a period of time, here Explain: the compound growth rate is a geometric progression of growth, the total number of the previous period of growth as the base for the next year's calculations, and so on. (Algorithm: for example, an industry's growth rate of 5% in the first year, 6% in the second year, and 7% in the third year, the average annual growth rate = (0.05+0.06+0.07)/3 = 6%, and the compounded growth rate = three times the root of the next (1.05*1.06*1.07) - 1 = 5.99%);
Market share: Generally speaking, industry-leading companies can occupy about 20% of the market share, however, the business laws of some industries are difficult to form a 20% share, such as the printing and freight industry with a very high degree of discrete, of course, some industries are very easy to form a monopoly, such as oil, electricity, etc. The replicability of the business model in the industry can often be highlighted when doing this part of the analysis as well.
2. Industrial and value chains
It is interesting to note that the industrial chain is the aggregation of different parts of an industry, with the aim of understanding the linkages, structure, and value of each participant in the chain. The traditional way of analyzing the industry chain is very complex, involving supply and demand, value, space, etc. In general industry analysis, as long as the upper, middle and lower reaches of the industry chain can be grasped.
It is recommended to show the form of charts, and when doing industry chain analysis, it is also necessary to consider which places are more crowded in different players, which chains are opportunities to be tapped, as well as the importance of different connection points.
As shown in the figure:
In addition, supervisory organizations, advertisers, third-party service providers, etc. can be accessed in the industry chain, so if you want to do a deeper analysis, you can expand on the basic industry chain.
As shown:
Value chain , as the name suggests, to find out the value embodied in different parts of the chain, many times overlap with the industry chain, and in the process of analyzing the industry chain, you can basically understand the information points about the value chain. Value chain analysis in business, the main grasp of profit value and importance.
Profit value refers to a commodity, in the "research and development - production - channel - consumption" of the general chain, each node ingests how much profit, or the other way around, the final price of consumer purchases, backwards and forwards to go back to how the distribution. For example, if a consumer spends 100 RMB to buy 1kg of freshly ground coffee in a supermarket --- the supermarket (retailer) earns 8 RMB --- the agent (distributor) supplying the supermarket earns 6 RMB --- the coffee brand company (processor) earns 24 RMB --- the middleman (supplier) of the coffee beans earns 36 RMB --- the coffee bean farm earns 40 RMB. As you can see from this chain, the middlemen of the coffee beans ingest a large profit, and that could possibly be holding a sufficiently scarce resource of coffee beans so that the income of the other nodes of the chain is skewed in that direction.
Of course, value chain analysis is not simple, and the chain is not as short as it is above, and there are wealthy market players who monopolize a long segment of the chain, maximizing value and minimizing risk.
3. Getting out the tools
It's time to shine! The purpose is to summarize the industry trends, there are many methods, tools just provide a framework to integrate scattered resources together. Based on the previous analysis of the entire industry, this time you can take out the PEST to strong X.
P (political, Politic): The political environment includes a country's social system, guidelines, policies, decrees, etc.. Remember, the characteristics of the national approach, policy tendencies on the organization's activities, the attitude and impact of the organization is also constantly changing.
E (Economic): The economic environment is mainly macro and micro analysis, one is the country's overall economic environment and level of development, the other is the economic level of consumers and consumer preferences.
S (society, Society): Social environment focuses on the values of residents and consumption habits, for different industries to analyze the social environment is different.
T (Technology): The development of technical means directly related to the industry, of course, but also to look at the formation of relevant patent protection barriers to the protection of the situation.
After doing the above analysis of large industries, you can basically make the corresponding judgment for industry trends, and perhaps find the analysis of the industry's opportunity points, although this part of the industry analysis of the first step, but it is the basis for a more mature market or do not intend to do too much vertical segmentation of the enterprise, and then simply with the analysis of the market lifecycle and competitor analysis, you can summarize the competition by way of key factors. The key factors in the way to output a certain business methodology.
But let's move on to the next step:
Segmentation Research
As mentioned earlier, this is now a business era of competition in segmentation, and segmentation analysis focuses on the target customers, so it is important to be very careful not to treat all similar products as segments relevant to you. This part of the analysis, there are also three main objectives:
a. Characteristics of the market segment
b. The market (product) in the life cycle
c. What are the main competitive factors in the industry
Still gives a basic research "formula":
1.
1. Determine the market segments
First of all, the right to find the segmentation, can not be similar products are treated as a relevant market, but at the same time can not be blindly excluded from the related parties. For example, the catering industry, if you do the main fitness and fat loss catering, it is very independent segmentation, can be discharged from other types of food and beverage, but if you do the Sichuan cuisine, blindly Xiangcai, Northeast China cuisine, etc. excluded, because from the point of view of the cuisine, the consumer did not produce a large partition, will inevitably ignore a large part of the market. Therefore, have their own characteristics, and other segments of the industry to form an effective separation of cognition is the "real.
This is the first time I've ever seen a market that was so different from my own.
When choosing a segment, two principles are important: (1) the segment is large enough to be profitable, and (2) it is a market that can be reached efficiently through your own operations.
After that, it is to analyze and summarize the characteristics of the market segments, which really need to be industry-specific analysis, in general, you can focus on the following dimensions:
Consumers (customers)/products or services/industry chain location/market structure/growth
2.Industry (Market) Life Cycle
The market life cycle is very important for industry analysis. Very important, different stages have different market characteristics, and different markets will form their own unique life cycle, generally summarized in four periods: start-up, growth, maturity, decline.
A core of the industry life cycle is: when the market is in the start-up and growth period, to be based on the incremental market; when the market is in the maturity stage and recession, to seize the stock market, and at the same time looking for transformation or new segmentation, the recession into a new growth period.
The industry is in a different period, facing different problems:
Start-up period: to solve the problem of user awareness, focusing on communication
Growing period: to solve the problem of user conversion, focusing on operation
Maturity period: to solve the problem of user retention, focusing on branding
Decline: to solve the problem of product transformation and innovation
Decline: to solve the problem of product transformation and innovation
The industry is in a different period, facing different problems.
Entering the recession does not mean that the industry is not attractive, or is about to be replaced, excellent products have the opportunity to revitalize the industry, the new segmentation can also re-create user demand.
3. Key Competitive Factors in the Industry
Competitive factors vary from industry to industry, and in general can be categorized as: R&D, quality, price, marketing, and service.
For example, in the running shoes market, R&D and quality are very critical; in the FMCG juice market, marketing is the main competition point; in the upper supply chain industry, price is very sensitive; and convenience stores look at the services provided to a region.
Of course, the analysis of key competitive factors is not so easy, based on the results of the previous analysis of the industry, to summarize the competitive factors suitable for the industry in which it is located and guiding.
Many people know that "Porter's Five Forces" is a method of competitive analysis proposed by strategy guru Michael Porter. Porter proposed a competitive analysis method. Porter's five forces is a very strong analytical method, whether it is strategy development or industry analysis, there is a corresponding combination. From the perspective of industry analysis and research, it is more to consider the attractiveness of the industry as well as competitive elements. The five forces are:
Threat of substitutes
Threat of new entrants
Bargaining power of suppliers
Bargaining power of buyers
Strength of competition in the industry
The above is some analysis and summarization, write a long, but in fact, it's just a framework that can be done both in-depth, with a 2-hour time to do industry research, or just half an hour to complete a fundamental analysis.
The purpose is different, the output is necessarily different, the main thing is to form their own industry analysis of the concept and framework, to be able to output valuable conclusions is the key. Like the beginning: accurate results, can give a guiding conclusion.