Entrepreneurship

MODULE 2-6
“RECOGNIZING THE POTENTIAL MARKET”

MS. JINKY C. CAPONGCOL R’CRIM

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RECOGNIZING THE POTENTIAL MARKET

At the end of the week, you will be able to:

 
 Analyze the market need
 Determine the possible product/s or service/s that
will meet the need
 
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1. Opportunity spotting and assessment

 beginning and most difficult
 entrepreneurs take note of interesting trends in the environment
 other major sources of opportunity are the glaring problems in the
environment, problems encountered by co-entrepreneurs, new
trends, processes and developments in the environment
 other minor sources are feedback from distribution or business
partners ( retailers, wholesalers, manufacturers and technical
people that the entrepreneur is working with
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2. Developing a business plan

 Entrepreneur should formulate a business plan when
they have already spotted and assessed the
opportunities for a market.
 The business plan will be the core guide and direction of
the entrepreneur in calculating the resources needed ,
assessing how to obtain these resources efficiently, and
running the business sustainably
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3. Determining the capital needed

 It is mandatory in the entrepreneurial process to calculate the
resources needed to establish the business and compare this
against the entrepreneur’s current resources.
 Allowance must be considered as well because there will be
times that resources will be inadequate or unsuitable
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4. Running the business

 Part where the entrepreneur should use the resources allocated for
the new venture
 The business plan prepared in step 2 should already have been
implemented.
 All aspects of the business plan should be critically observed from
operations,marketing and sales, human resources, finance, and
strategy implementation.
 The entrepreneur should have a control and monitoring system to
serve as a check and balance of the formulated plans.
 
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Seeking, Screening and Seizing (3S of Opportunity)
 An opportunity is an entrepreneur’s business idea that can potentially
become a commercial product or service in the future.

S1. Seeking the opportunity

 the first step and is the most difficult due to the number of options that
the entrepreneur will have to choose from.
 
 Involves the development of new ideas from various sources:
 Microenvironmental sources
 STEEPLED( mnemonic for sociocultural, technological, economic,
environmental, political,legal,ethical and demographic factors)
 Industry
 New discovery of knowledge
 Futuristic opportunities
 
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Seeking, Screening and Seizing (3S of Opportunity)
 An opportunity is an entrepreneur’s business idea that can potentially
become a commercial product or service in the future.

 Micromarket
 Consumer preferences,interests and perception
 Competitors
 Unexpected opportunities from customers
 Talents, hobbies, skills and expertise
 Irritants in the marketplace such as deterrents, problems, complaints
and delays.
 Location
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Methods of Generating Ideas

 Focused group discussion (FGD)
 Moderator handles a very open, free-flowing and in-depth discussion
with a group of people who can provide insightful ideas about a new
product or service that will fill a market need.
 Brainstorming
 Activity that allows the participants to share creative ideas
 Brainwriting or Internet brainstorming
 This is exactly the same as brainstorming except that the channel used
is not face-to-face , but in writing or online.
 The results usually take longer as the answers depend on the
availability of the participants in answering the questionnaires online.
 Problem inventory analysis
 This method is similar to the FGD except that the participants are
already given an inventory of product or service problems.
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S2. Screening the Opportunity

 Selection will depend on the entrepreneur’s internal intent
 The entrepreneur should apply due diligence and
independent judgement in selecting the opportunities
that have a potential and eliminate those that are not
within the scope of the entrepreneur’s risk appetite.
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The Opportunity Attractiveness Test (OAT)

 The Opportunity attractiveness Test (OAT) aims to assist entrepreneurs
in ensuring that the opportunity that they will venture into is an attractive
and feasible prospect.
 This test is designed to detail each entrepreneurial aspect into small
chunks to come up with a sound entrepreneurial decision.
 The entrepreneur must answer this test realistically and avoid
overestimation or underestimation.
 The answers in this test will be the guiding principles of the
entrepreneur in writing the business plan.
 at the end of this test, the entrepreneur should be able to at least
decipher the relative attractiveness of the business opportunity.
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S3. Seizing the Opportunity

 Opportunity seizing is the last step in opportunity spotting
and assessment.
 This is the “pushing through” with the chosen opportunity .
 The entrepreneur’s idea can be any type of any
innovations.
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Types of Innovations according to the degree of

distinctiveness:
Breakthrough innovation
 Must be protected by a patent, a trade secret, or
copyright.
Ex.: Internet, computer, airplane
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2.Technological innovation
 occur more frequently than breakthrough innovations
Ex.: wireless fidelity or WIFI, laptop, jet airplane
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3.Ordinary Innovation
 commonly originating from market analysis and
technology pull instead of a technology push.
( This means that the market has a strong influence in
the implementation of an innovation.)
 
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Product or Service Planning and development process

 
The refining process called product or service planning and
development process. It has five key stages:
 
 Idea Stage
 Usually, a market evaluation is conducted by entrepreneur to
assess whether the new product or service ideas will be
accepted by the market using values and benefits to
consumers as metrics
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 Concept stage
 The developed idea will undergo a consumer
acceptance test. This test includes getting the initial
reactions of the primary target market and the
distribution channel.
 Conversational interviews are conducted to
understand consumer preference on physical
characteristics and attributes of the product or the
physical evidence and characteristics of a service.
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 Product Development Stage

 Actual reactions from prospective customers are determined
 The entrepreneur will conduct a consumer panel of potential
customers
 
 Test marketing stage
 Validates the work done from the first 3 stages to measure success in
the commercialization of the product or service
 Actual sales results will be the foundation of the consumers’
acceptance level and will be the basis in commercializing the product
or service.
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“Sometimes the best thing you can do is not

think, not wonder, not imagine, not obsess.
Just breathe and have faith that everything
will work out for the best.”
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REVIEW FOR 20 MIN.

QUIZ NO. 2@3 FOR 2ND
SEMESTER
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