The best way to effectively conduct a strategic market analysis is to study the market with a view of comparing the resources with the opportunities available in the given market. The market may be studied in segments or it may be studied as a whole, depending on what the company is trying to achieve. If the aim of the company is to sell products to at teenage girls, then the market analysis will be largely focused on the study of the teenage girl population in the area since they are the target customers.
The first step in a strategic market analysis is to study the market with a view to discovering information relating to the potential customers. If the target market is women in general and not just teenage girls, then the strategic market analysis will include studies on the sort of products women really want. This will enable the company to find a need that it can fill and possibly cash in on. Women need a lot of products, and the decision regarding the exact items of concentration depends on the result of the strategic market analysis. An example of something women need is sanitary towels. The company may decide that it will focus on the production of sanitary towels and conduct further research to give it a more general feel of the environment.
The fact that women need sanitary pads does not mean that other companies have not identified this need. Therefore, the second step in strategic market analysis is to find out about the competition. This may include the study of the quality of sanitary towels produced by other companies, the packaging, and the advertising or promoting of these products. If other companies are selling their sanitary towels for $5 US Dollars (USD) for a pack of 10, the potential investor may decide to sell its own brand at the rate of $4.60 USD for a pack of 12. The investor may also decide to improve the quality of the sanitary towels and to promote its product vigorously.
Another issue of concern is aspects like government and trade regulations that might affect the importation and production of materials, labor laws that might affect the hiring of employees, and other such issues. The third step is to find out if the company has adequate resources to carry out the production of the item meant for the target market.This includes seeing if the company can afford to execute the plan, through a loan or otherwise.