Following a very good tradition of MDB recently I was asked to share some insights regarding Market Intelligence thus contributing to the general beverages business development awareness among our subscribers and visitors.
There are some points I would like to cover in my article this time. Being involved into Market Intelligence activities for many years I have noticed some general mistakes both – the large and the small market players – are doing across the globe, time and businesses. And the key headline here would be – PLEASE, DO YOUR HOMEWORK. I fully realize that this moto is as old as the marketing itself, however, there are still many business decisions made mainly on the basis of so-called “best practice”, “market experience” or even “gut feeling”. I admit, that the afore listed are very important in daily and strategic running of business, but without at least top level Market Intelligence in the majority of cases they might turn into if not false, so at least less professional decisions of your business. Especially, taking into account that market landscape tends to change much faster than it was a decade ago.
Please do your homework!
So, let’s run through some very top level Market Intelligence hints which would help you to reduce the risks of a new product entrance to the new market – the stages of Don’t miss the Others and Don’t hesitate to retrieve and reconsider pointing to the problems I encounter while communicating with clients. The other two mainly providing some hints in between to make your business planning process more effective.
Don’t miss the Others. The majority of business planners in the beverage industry make market potential assessment reviewing the key players’ performance omitting the growing importance of the Others. The Others market recently is gaining at a very good pace by investing in new product development and marketing.
As the recent trends indicate, the small beverage brands are gaining share perceived as more innovative, healthy and finally, more trendy than the well historically established big brands. This growing importance of smaller brands in market innovation is very well illustrated by the efforts of the key global players to keep their hand on market pulse via starting their own venture capitals.
However, the small companies and start-ups are not only the Unicorns environment, with the vast majority of their ideas failing when meeting market reality. On the other hand, their experience is highly valuable for future business ideas development. Close examination of their failure and success stories may be super important while setting the new products on the selected markets. Of course, in many cases, the new beverages from small companies and start-ups vanish from the market due to lack of scale.
However, it doesn’t mean that the initial idea was wrong. Therefore, the examination of previous case stories of Others in combination with access to mass market shelves can be a good basis for successful business.
Do not hesitate to Google
Don’t hesitate to google. Although being the simplest way to check the assumptions for your success, in many cases this stage of the business reconnaissance is missed by market players. Factors, such as blind belief in their business idea or ignorance of supposed to be small shifts in market landscape might turn your business planning into wrong path from the early stages. Moreover, this simple exercise may provide you the information which might be enough to take some decisions; eg the overview of available product offer may indicate that the selected pack type or ingredients, which worked well in other market is totally not present in the new market. And this may help you to turn your business planning into asking additional questions before taking the decision to enter. Or on the contrary, it may point to the fact, that your supposed to be innovative product would meet harsh competition from smaller brands already present in the selected market or didn’t prove to be successful historically. Sounds like pretty straight forward and obvious point, however, sometimes still missed by business planners.
Do not hesitate to talk
Do not hesitate to talk. More complicated, but in many cases a must stage of your business planning. Although the googling stage is the easiest way to obtain initial insights during the course of Market Intelligence, it doesn’t provide you the whole picture of what is going on in the selected market. Please note, that the more niche is the product category you are going to be playing in, the less information you will find online regarding the general market trends, distribution and other top-level insights, necessary to take the correct decision. And one more important point this stage - hear what people say. This is the most difficult part for the ones, who strongly believe in their business idea.
From the first glance, it may look that some specific, recently started being noticeable product has a very good market potential, “very popular in California”, however, the closer look may show the totally different story after discussion with distributors or retailers. This point is super valid in the case of reviewing historic failure cases, mentioned in Don’t miss the Others. For example, information sources usually suffer from market amnesia – the failures of small brands or supposed to be in the past innovative products are not very much described in open sources and only discussion with knowledgeable experts can provide some insights. As a result, visits to conferences, exhibitions and talk to market players such as retailers, distributors or manufacturers; or visits to the simple brick and mortar stores and chat with salesman or store manager can provide you information, which is totally absent online.
Hear what people say!
And one more important point this stage – hear what people say. This is the most difficult part for the ones, who strongly believe in their business idea. But trust me, at least some points taken aboard from your possible future partners, such as retailers and distributors will do your life less complicated.
And finally, the most painful part of business planning. As I have already mentioned before, ignorance or blind belief in your business idea can be crucial for your business future. Please note, that there are not very numerous universal rules, which can be applied in any market around the globe and driving directly to the success. Markets, consumers, and trends are very different in the beverage industry and becoming even more hectic with emerging number of new players.
Reassess your initial belief
Thus, do not hesitate to take a cup of tea and reassess your initial belief. Maybe the decision to change your packaging from 100ml to 330ml or targeting price segment of lower level might be the reasons behind your future business prosperity. Maybe your flavor, claim, price and packaging combination had already been presented in the market and failed a couple of years ago. Or on the contrary, you will find out that combination except the pricing was good. And you can take advantage of previous failure stories.
That’s my first blog regarding the Market Intelligence. As you may have noticed, I have started from very basic insights which, on the other hand, are too often missed during business planning. I do remember myself thinking that homework in my high school times was the most annoying part of being a pupil. However, after it proved to be the easiest way to deal with all that seemed to be a super complicated teenage problem of going and graduating high school. Surprisingly, the same approach seems to work in adult life as well.