1. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. ChapterChapter4 Identify and Meet a Market Need 4.1 Identify Your Market 4.2 Research the Market 4.3 Know Your Competition

2. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 2 Lesson 4.1 Identify Your Market Goals Identify a target market by analyzing the needs of customers. Explain how market segmentation can help an entrepreneur analyze a target market.

3. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 3 Vocabulary target market market segments customer profile demographics psychographics use-based data geographic data

4. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 4 Target Market customers the people or organizations who buy the products and services companies offer target market the individuals or companies that are interested in buying a particular product or service

5. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 5 Identify Your Target Market Consider the following information regarding your customers: individuals or companies? age, income, place of residence? industries customers are in? needs and wants my product will satisfy? number of potential customers in my area? demand for my product or service? who is the competition? pricing of product or service? what is unique about my offering?

6. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 6 What questions should you ask when identifying your target market?

7. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 7 Market Segments market segments groups of customers within a large market who share common characteristics Most products and services appeal to a small portion of the population. It is important to carefully analyze market data to meet the needs of segments of the market.

8. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 8 Customer Profile customer profile a description of the characteristics of the person or company that is likely to purchase a product or service

9. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 9 data that describes a group of people in terms of age marital status family size ethnicity gender profession education income demographics

10. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 10 data that describe a group of people in terms of tastes opinions personality traits lifestyle habits psychographics

11. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 11 data that helps you determine how often potential customers use a particular service geographic data data that helps you determine where your potential customers live how far customers will travel to do business with you use-based data

12. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 12 Name four types of customer data that may be analyzed in developing a customer profile.

13. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 13 Lesson 4.2 Research the Market Goals Explain the role of market research. Identify the six steps involved in market research. Explain the role technology plays in marketing research.

14. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 14 Vocabulary market research primary data survey focus group secondary data customer relationship management

15. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 15 Role of Market Research market research a system for collecting, recording, and analyzing information about customers competitors products services

16. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 16 Primary Data primary data information collected for the very first time to fit a specific purpose survey a list of questions you ask your customers to determine demographic information psychographic information

17. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 17 determining information by watching customer behavior focus group an in-depth interview with a group of target customers questions are similar to survey questions group interaction allows for more discussion observation

18. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 18 time-consuming more expensive disadvantages of primary data

19. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 19 Secondary Data secondary data information found in already-published sources

20. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 20 publications issued by government and community organizations industry specific books government and business websites books about entrepreneurs in similar businesses trade publications newspaper articles and statistics Secondary data can be found in:

21. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 21 What types of data can be collected through market research?

22. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 22 Six Steps of Market Research Although primary data collection is time consuming and expensive, it will tell you exactly what you want to know. Primary data can uncover information that is often not available through secondary sources.

23. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 23

24. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 24 Determine exactly what it is you need to know. 2.Determine the Data Needed Decide what data you need to answer the question. 1.Define the Question

25. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 25 Decide the best way to gather data. People’s opinions can be obtained through focus groups surveys secondary market research demographic data psychographic data economic trends industry forecasts 3.Collect the Data

26. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 26 Thoroughly analyze and interpret data. Write down analysis results for future reference. 5.Take Action Use your analysis results to develop an action plan. 6.Evaluate the Results Entrepreneurs must regularly evaluate the actions they take as a result of the plan. 4.Analyze the Data

27. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 27 What are the six steps of market research?

28. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Technology-Driven Marketing Customer relationship management a business strategy designed to increase profitability and customer satisfaction uses technology to track customer interactions focuses on understanding customers as individuals instead of as part of a group Chapter 1 Slide 28

29. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 29 Companies collect data about customers through interactions that occur via phone web salespersons product registration product warranty cards Interactions with Customers

30. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 30 places where a customer might have contact with a company discussion with delivery personnel electronic data transfer the movement of data between locations in a structured, computer-retrievable format touch points

31. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 31 data warehouse a large computerized database containing all of the information collected in the CRM process data mining finds hidden patterns and relationships in the customer data stored in the data warehouse Customer Database

32. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 32 What is the goal of CRM?

33. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 33 Lesson 4.3 Know Your Competition Goals Explain the importance of knowing and understanding your competition. Prepare a competitive analysis. Describe strategies for maintaining customer loyalty.

34. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 34 Vocabulary direct competition indirect competition competitive analysis

35. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 35 Impact of Competition You should always watch the competition. Offer products that are of equal or better quality that sell for the same or lower prices.

36. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 36 Understand the Competition New businesses need to identify some special customer need or want that is not being met.

37. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 37 Know the Types of Competition direct competition a business that makes most of its money selling the same or similar products or services to the same market as other businesses

38. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 38 a business that makes only a small amount of money selling the same or similar products and services to the same market as other businesses indirect competition

39. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 39 Reasons that make it difficult for entrepreneurs to compete with large retailers include: Large retailers can keep larger quantities of products in stock. Large chains do not rely on a single product line. Large companies have a larger advertising budget. large retailers

40. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 40 Why is it important to understand the competition your business faces?

41. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 41 Competitive Analysis competitive analysis identifying and examining the characteristics of a competing firm

42. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 42 Make a list of your competitors. Summarize the products and prices offered by your competitors. Follow these steps to begin your competitive analysis:

43. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 43 Find out the strategies and objectives of your competitors. Determine the opportunities in the market. Identify threats to your business from the competition. List each competitor’s strengths and weaknesses.

44. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 44

45. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 45 What is the purpose of a competitive analysis?

46. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 46 Maintain Customer Loyalty Listen and Respond to Feedback Continually ask for and respond to customers’ needs.

47. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 4 Slide 47 superior service convenient hours easy return policies store-specific credit cards personal notes or birthday cards frequent-buyer programs Other strategies for Maintaining Loyalty

48. Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter 1 Slide 48 What are some strategies for maintaining customer loyalty?