Marketing analysis comes in various flavors, but perhaps the one most important and elemental analysis you can perform for your business or startup is the Gap Analysis.
Gap Analysis can mean different things in different contexts, but here we are talking about marketing channels.
By understanding your customers’ needs and analyzing your competition’s approach to filling those needs, a gap analysis can identify opportunities, help you to define marketing goals, and provide insight for your own strategic decision-making.
This is also a useful technique if you’re working on a business plan and getting ready to start a business. You can perform a gap analysis on your future competitors and gain insight into how you can best differentiate when you launch your new product or service.
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The first and most important step is to understand what your customer wants.
All customers of all businesses have their own “service output demands.” SODs are a customer’s essential needs that have to be met for them to purchase your product or service.
Most customers have a mix of requirements, which can range from the very simple (“What is the absolute, rock bottom price I can buy this product for?”), but more typically are a more complex and personally weighted mix of those quantitative SODs as well as qualitative elements such as expedience (“How convenient is the location and how long will it take me to drive there?”) and experience (“Does this salesperson have the knowledge and skill to train me in the best ways to use the product?”).
Your own customers can be beneficial in performing your Gap analysis; tools such as surveys and social media can help clarify your customer’s SODs but only if you are paying attention and listening closely.
The answers your customers provide can guide your analysis of the competition as well and help to identify the “gaps” that exist in your marketing channel where customer’s SODs are not met or when they are being provided at too high a level.
For instance, if low price is your customer’s most important SOD and your competition’s offering is priced too high, that particular demand is not being met, and a gap may exist.
Alternatively, if the competition has a very low price point, they may be over-providing, and you might actually increase your own price without losing customers.
Identifying these gaps will allow you to align your marketing strategy with your customer’s SODs.
Segmentation of your customer base is also an important aspect of gap analysis. Gaps can sometimes be with one segment that is not being well served.
Home Depot recognized this with their own customer base. It began an effort to market to women by training their staff to be friendlier and non-condescending and offering in-store classes specifically designed to teach women home maintenance and repair skills.
With thorough analysis, your company may be able to fill the gaps that your competition had created and identify gaps in your own offerings.
Pay close attention to what your customers are telling you and the signals in the marketplace, and position your company to close gaps where you find them.
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