ENTREPRENEURSHIP

Quarter 1: Module 3 Week 3

RICEL R. AÑAGO
 Learning
Competency:
Recognize a potential
market and analyze
the market need.
Lesson 4 :The Potential
Market and the Market Need
Activity 1: DIRECTIONS: To check your prior knowledge about the topic,
please analyze the pictures below and list down at least three (3) potential
markets that entrepreneurs should consider during this COVID -19 pandemic
and indicate their needs. Write your answer in the space provided.

POTENTIAL
MARKET

MARKET
NEED
 LOOKING BACK TO
YOUR LESSON

What are the competencies

in Entrepreneurship?

20XX presentation title 5

 THE POTENTIAL MARKET
part of the total population
that has shown some level of
interest in buying a particular
product or service
part of the market you can
capture in the future
total demand for a product in a
given business environment
(Bhasin, H., 2018)
also called Total
Addressable Market
(TAM) (MBA Skool Team,
2018
includes the demographic groups
that are not currently your
customers but could become
customers in the future (Lake, L,
2019)
 THE IMPORTANCE OF POTENTIAL
MARKETS (LAKE, L., 2019)
Potential markets are an
important part of a
business's future growth.
Think proactively about ways
for your business to grow and
change.
Increase your
revenue.
Ensure the future of your
business by identifying new
customers.
Show the potential of your
business to investors or
collaborators.
Create a plan B that will weather
changes in the economy or
market.
 Consider every
target demographic that
you currently sell to, as
well as those you have
not yet targeted.
MARKETS (LAKE, L.,
new milestones that they
will encounter in their lives
that will impact their
buying patterns
identify what they have
in common with each
other,
HOW TO IDENTIFY
YOUR POTENTIAL
2019
and where they overlap or
diverge from your current
customers.
Ask yourself these questions that will help you identify both new ways to
market your current products or services, as well as new products and
services that you can begin selling.
o
What other products do my customers need now?
o What related products will they need in the future?
o Who else could make use of the products I am selling
now?
o What demographic information does that new group have
in common with my current customers?
o What demographic information does that new group have
in common with each other?
20XX presentation title 9
Ask yourself these questions that will help you identify both new ways to
market your current products or services, as well as new products and
services that you can begin selling.
o
Hospitals and other health related industries whose
employees are prone to COVID -19 virus and other
viruses.
o Business industries and other organizations who want to
ensure the health condition of their employees.
o Employees and workers who need to report to work to
earn income.
o Households who needs to go out for their necessities.
 The language that
resonates with them.
The demographic
information that people The best forms of
in a group have in media to reach them.
common.
REACHING YOUR
POTENTIAL
MARKET (LAKE,
L., 2019)
How they prefer The concerns,
struggles, or problems that
to shop and make What values matter to you can help them
purchases. them, both in everyday life overcome.
and when shopping.
The figure below depicts what is a potential market with respect to the
total population and how it can be converted to a penetrated market:
Available Market
Prospects who are willing and
capable (have sufficient
resources) buyers, and have
access to a particular market or
service (
www.Businessdictionary.Com).
Defined as the number of
people who are both willing
and capable of buying a
particular product or service in
a particular market (MBA
skool team, 2020).
Target Market

Refers to a group of potential customers to whom a company

wants to sell its products and services. Target markets are generally
categorized by age, location, income, and lifestyle. Defining a
specific target market allows a company to home in on specific
market factors to reach and connect with customers through sales
and marketing efforts. (Kenton, W., 2019).
Penetrated Market

A set of customers or clients who are already using a particular

product or service. A penetrated market means that the potential
users of a product or service are aware of it, and in many cases are
active consumers of it. (www.businessdictionary.com).
THE SIZE OF A POTENTIAL MARKET HELPS A COMPANY UNDERSTAND THE LEVEL OF
INVESTMENT IT SHOULD MAKE FURTHER IN THE MARKET, WHILE TAKING INTO
CONSIDERATION OTHER FACTORS.

IF THE POTENTIAL MARKET IS VERY SMALL, IT MEANS THERE IS A VERY SMALL

FRACTION OF THE TOTAL POPULATION SHOWING ANY INTEREST IN THE PRODUCT OR
CATEGORY.

THIS MEANS THAT IT IS BETTER THAT THE COMPANY DOESN’T INVEST FURTHER IN THE
PRODUCT OR CATEGORY BECAUSE PEOPLE WON’T BUY IT.
 IF THE SIZE OF THE POTENTIAL MARKET IS LARGE, IT MEANS THAT THERE IS A
HUGE FRACTION OF THE TOTAL POPULATION WHICH IS SHOWING INTEREST IN THE
PRODUCT, SO FURTHER INVESTMENT CAN BE MADE ON THE PRODUCT DEVELOPMENT
OR MODIFICATION, MARKETING, PROMOTIONS ETC.

THE SIZE OF THE POTENTIAL MARKET GIVES AN ESTIMATE OF WHAT ALL A COMPANY
SHOULD DO AND HOW MUCH IT SHOULD INVEST (MBA SKOOL TEAM, 2018).
 The Market Need
A driver of human
action which marketers
A motivating force that
try to identify,
compels action for its satisfaction.
Needs range from basic survival emphasize, and satisfy,
needs (common to all human and around which
beings) satisfied by necessities, to 1. NEED promotional efforts are
cultural, intellectual, and social organized
needs (varying from place to (www.Businessdictionar
place and age group to age group)
y.COM).
satisfied by necessaries
(www.Businessdictionary.Com).
 The Market Need
A Market is a place where
two parties can gather to facilitate
the exchange of goods and
services. The parties involved are
usually buyers and sellers. The
market may be physical like a
retail outlet, where people meet
face-to-face, or virtual like an
online market, where there is no
direct physical contact between
buyers and sellers (Kenton, W. &
Boyle, M., 2020).
A market is any
place where sellers of
particular goods or
services can meet with
buyers of those goods
2. MARKET and services. It creates
the potential for a
transaction to take
place.
EXISTING CUSTOMERS: PEOPLE WHO HAVE ALREADY PURCHASED YOUR PRODUCT.

PROSPECTS: PEOPLE WHO HAVE NOT YET PURCHASED YOUR PRODUCT BUT ARE
CONSIDERING IT.

TARGET MARKET USERS: PEOPLE IN YOUR TARGET MARKET WHO ARE NOT CURRENTLY
LOOKING FOR A SOLUTION.
Define the Market Need for Your New
Business
WHY IS IT IMPORTANT TO CLEARLY DEFINE MARKET NEEDS?
THE MARKET NOW DEMANDS THAT YOUR BUSINESS ALIGN TO
THEIR NEEDS. IN ORDER TO PROPERLY ALIGN YOUR MARKETING
EFFORTS ‒ AND YOUR CONTENT, IN PARTICULAR ‒ TO WHAT BUYERS
NEED, YOU HAVE TO HAVE A CLEAR UNDERSTANDING OF THE MANY
INTRICACIES, PAINS AND PRESSURES WITHIN YOUR MARKET. TO
ACHIEVE SUCH ALIGNMENT, THE ABILITY TO DEFINE MARKET
PATTERNS, NEEDS, INTERESTS, PREFERENCES, ETC. FOR A
COMPREHENSIVE VIEW OF THE BUYING PROCESS IS CRITICAL (
WWW.ABERDEEN.COM).
Below are ways to define your market
(Lancaster SCORE (2010):

Consider whether the business offers a new solution to an

old problem or complements an emerging trend.
Have a clear picture of your target market.
Determine the benefits that your product or service offers.
Examine industry data that can confirm whether there is a
sustained, growing demand for your product or service.
Below are ways to define your market
(Lancaster SCORE (2010):
Identify the percentage of market share that it is
realistic for you to capture. The more competition you
have, the lower the margins will be.
Consider how realistic your pricing is. How can you
present your product or service to potential customers so
that it appears to be a good value, while still affording
you a healthy profit?
THANK YOU