The inevitable question that management consultants are struggling with when developing their financial model for a new venture is the likely demand it could expect. When investments backing a potential venture could be substantial, the risk of estimating the demand based on secondary research only – if available at all – is too great. For this reason major international management consulting firms – and indeed their clients – require primary research to ensure due diligence in compiling a credible and defensible financial model for a project that has often only recently left the drawing board.
Incite’s approach to market feasibility surveys is quite different from most other research agencies that offer this service. We believe that the conventional combination of secondary research with in-depth interviews with industry stakeholders relies too heavily on uncorroborated sources and opinions that cannot distinguish between sound insider information and hearsay. For this reason, Incite introduced a quantitative dimension with the key demand segment to plug gaps of hard data left by secondary research or to validate it with the scope of robust in-depth analysis.
Typically the research tools Incite applies to market feasibility surveys draw on:
- Secondary research to estimate the size of the target audience and extract any relevant data pertaining to the business proposition of the client. Over the years, Incite has accumulated a wealth of secondary findings across the regions it operates in and updates the data at regular intervals. Just to name a few…
- Census data and allied demographic information.
- Population data of retailers, wholesalers/distributors or manufacturers.
- Macro economic data.
- Incidence rates of a particular respondent segment.
- Market sizes and shares (if available).
- Market trends.
- Company profiles of industry stakeholders.
- New products.
- Technical specifications.
- Pricing data for raw materials and other commodities.
- Import and export regulations/duties.
- Government policies affecting the availability of products or raw materials.
- Short random listing interviews to understand the incidence rate of the target audience as estimated from the secondary research. This helps researchers define and analyse the profile of the target audience, e.g. classification of business activity, size of the business, demographics, etc.
- Quantitative interviews with a representative sample of the target audience.
- Focus groups with consumers if the business concept for them is at a fledgling stage or requires tweaking.
- (Semi)-qualitative interviews with suppliers at relevant levels in the supply chain.
- (Semi)-qualitative interviews with industry experts/observers or other respondents ‘in the know’ (e.g. government officials).
Incite developed a proprietary model in order to estimate the likely demand based on several inputs such as awareness, brand image, affinity, current usage, brand used and purchase intent. Its high level of predictive accuracy buoyed Incite’s demand for this service.