Determining Market Potential for a New Product or Service

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Table of Contents

Decision and Research Problem to Be Addressed
Research Objectives
Methodology
Research Plan
Works Cited

Many companies today are increasingly faced with the problem of determining potential opportunities or threats existing within a market, before the introduction of a new product or service. For this reason, many companies embark on undertaking market research to evaluate the feasibility of a potential market, with regards to the above variables.

In this manner, companies can easily establish how potential customers will respond to their future products or services. Certain variables regarding a potential market can be ascertained, and they include: specific market places; the amount of products or services which can be consumed within the given market; and the appropriate marketing mix to be established when introducing new products or services.

From this analysis, we see that organizations increasingly need to know information relating to a market’s relevance and reliability, with regards to their product or service offing, but for them to accurately introduce their products in a potential market; they need to have accurate, reliable and valid information relating to the target market (Twedt 2).

This process is more important now that the business environment is highly competitive and the cost of doing business is increasing by the day. The importance of sound information relating to market statistics cannot, therefore, be overemphasized. The traditional approach of dealing with potential markets through gut feelings, personal judgment or even intuitions, therefore, does not apply in today’s business environment.

Furthermore, company managers are today faced with the problem of making sound decisions regarding their products or services (such as market segmentation, target market selection, the introduction and implementation of marketing programs) but to further complicate the situation, managers are often faced with the dilemma of quantifying the impact of internal marketing strategies, such as price, product, promotion and place, but at the same time, they are also faced with the dilemma of quantifying the impact of external business forces such as economic conditions, technology, legislative changes and such like forces (Twedt 2).

For the correct assessment of the marketing environment, and the correct determination of product or service strategies, it is therefore important to carry out a comprehensive market strategy to ascertain the right strategy a company should use to penetrate a given market. This mode of analysis is supported by the DECIDE model, which articulates the managerial decision-making process as a product of six steps.

The first step is characterized by the definition of the problem (or opportunity) a given market poses, with regards to the market opportunities several region pose to a company (Twedt 2). The second decision factor is characterized by the identification of numerous alternatives existing, with regards to the product or service strategies to be adopted.

These strategies may be based on controllable factors or uncontrollable factors, but both categories should be enumerated, and information regarding each category effectively availed to determine the possible outcomes expected after the pursuit of several alternatives (Twedt 2). Upon the ascertainment of these alternatives, the best criterion should be chosen after considering which alternative poses the best outcome.

A feasible marketing plan should, therefore, be developed to implement the chosen strategy and finally, an evaluation program developed to determine the success or failure of the marketing strategy should be adopted.

These are the motions that characterize the decision-making process, when trying to determine the best strategy to adopt when coming up with the best product or service strategy. These variables require the use of accurate information regarding the market potential of accommodating a new product or service (Twedt 2).

It has also been evidenced in numerous research articles that consumers are increasingly complex and do not share a uniform behavioral pattern (Twedt 2). From this analysis, it becomes increasingly difficult to predict customer reactions towards a given product or service.

However, the use of appropriate market research data effectively enables managers to link internal marketing variables, external business environments and unpredictable consumer behaviors. In this regard, the common feeling of uncertainty regarding the introduction of a new product or service is effectively eliminated (Twedt 2).

From the understanding of the importance of market research in the introduction of new products and services, this study seeks to carry out a research study to analyze Dubai, UAE market, with regards to its feasibility in accommodating Laser machines used for the treatment of dark circles under the eye – a product which is not in the UAE.

Decision and Research Problem to Be Addressed

For any company to effectively achieve product or service success in a new market, extensive market research ought to be carried out. However, it is not enough to only carry out marketing research and determine the success or failure of a new product in a new market; it is also important to determine the variables to watch in a new market.

Finding the right consumers in the United Arab Emirates market for Laser machines can be a difficult thing, and according to some marketing literature, very time consuming, if the right target market is not identified (because of the diversity in customer characteristics (USA International Business Publications 1).

The difficulty with introducing a new product or service in the UAE market is that, United Arab Emirates (UAE) being an Arab state is subject to unique behavioral traits among its population emanating from the influence of the Arabic culture and Islam religion (USA International Business Publications 1).

Considering many investors or multinationals around the world are looking for new growth opportunities, there is increased pressure among most multinationals to go global and expand their operations beyond their primary business environments.

There are many regions around the world that pose excellent investment opportunities and the UAE is no exception because the region stands out as one lucrative and highly profitable market destination (USA International Business Publications 1).

For instance, the UAE remains a very profitable market because of its increasing population and its increasingly wealthy population, which has also seen the emergence of a strong middle class, bound to increase the demand of goods and services in future (USA International Business Publications 1).

This positive market outlook of the UAE economy is further complemented by the high consumer confidence among consumers in the UAE. In fact, statistics show that, UAE has a high consumer confidence when compared to other countries across the globe (USA International Business Publications 1).

This statistic shows that, UAE consumers are very optimistic about various aspects of the economy, such as future employment opportunities, economic growth and such as aspects of the economy.

In this regard, many multinationals are increasingly investing millions of dollars in undertaking market research in these new destinations, so that they can increase their odds of realizing market success with their new products and services.

Since many multinationals have in the past overlooked developing markets, there is renewed focus on the UAE market as a ground for new growth opportunities (USA International Business Publications 1).

However, there is very little information present, relating to the dynamics of the UAE market because the UAE has often been characterized with a high sense of secrecy among its population, regarding their social and economic lives. Consequently, there is very little information regarding the dynamics of the UAE market, with regards to the success or failure of new products or services (USA International Business Publications 1).

Research Objectives

Main Objective

To determine the market variables to be considered before the introduction of new products or services in the Dubai, UAE market

Specific Objectives

To ascertain the impact of Dubai, UAE’s market size in the introduction of new products and services
To ascertain Dubai, UAE’s market growth rate and its impact on the introduction of new products and services
To establish Dubai, UAE’s market profitability and establish its impact on the introduction of new products and services
To determine the industry cost structure of Dubai, UAE’s market and its impact on the introduction of new products and services
To establish Dubai, UAE’s existent distribution channels and their impact on the introduction of new products or services
To establish Dubai, UAE’s market trends and the potential impact of such market trends on the introduction of new products and services in Dubai, UAE
To investigate Dubai, UAE’s key success factors and determine how they impact the introduction of new products or services.

Methodology

The major mode of research data to be used in this study will be secondary research data. In this regard, there will be widespread consultations of people who have knowledge about Dubai, UAE market, and in the same regard, there will be extensive research done, regarding existing information about Dubai, UAE market, through existing documents like textbooks, journals and the likes.

Through this research data, there are several advantages that will be derived. For instance, it will be more cost-effective to undertake secondary research data than primary research because it is cheaper to undertake primary research as opposed to secondary research (Nigel 121).

The data to be sourced is also easier to obtain; quick to obtain and very useful for research data relating to international research studies, such as the objectives encompassed in this research study. Majorly, the secondary research data to be relied on this study involves research data from external sources of information (out of the organization); in the form of directories, databases, industry reports and the likes.

These external sources may include research data relating to government reports on Dubai, UAE markets (through census studies done in the target market); industry statistics (from companies already engaged in the target market); online research data; academic sources of data and commercial sources of data (Nigel 121).

To obtain some of the above data, frequent visits will be made to general and specialist libraries, but more data will be obtained by contacting experts related in the field of Dubai, UAE market research (especially experts from multinational companies who have already established businesses in Dubai, UAE). To analyze the sourced data, business intelligence will be used as a computer-based technique to analyze the relevant data.

This data analysis technique will be used to analyze business data relating to product sales revenues, market profitability and such as financial data, but progressively, the data analysis tool will evaluate historical and current information to predict the future feasibility of the target market.

As a statistical application tool, this study will categorize research data into descriptive, exploratory and confirmatory research data, so that hypotheses can be developed about the target market, or alternatively, hypotheses can be confirmed (Nigel 121).

Research Plan

This research will be accomplished within a period of three months. Since the target market (Dubai, UAE) is a big economy, the market will be subdivided into several regions and research data regarding these regions effectively quantified. The first two months will, therefore, be allocated for the above purpose, but the first week of the first month will be allocated to collecting relevant data regarding the subject study.

In the same week, there will be a concurrent attempt to book appointments of market experts who have knowledge about the target market being studied. From the second week of the first month of study, a thorough data analysis will be done to come up with a summary of the relevant research information regarding the topic of study.

This will go on until the second week of the second month of study where the data analysis process will commence.

The data analysis process will proceed for the next two weeks, and after completion, interviews will be done in the first two weeks of the last month of study, to ascertain the information obtained from the market experts, or to provide new information, or insights regarding the target market, which were probably never showed in the first phase of research.

The last two weeks of study will be used to integrate the research findings and come up with a final presentation of the findings. The resources needed for this entire research to be a success, include unlimited sources of online and offline publications regarding the target market.

Works Cited

Nigel, Bradley. Marketing Research. Tools and Techniques. Oxford: Oxford University Press, 2007.

Twedt, Warren. Survey of Marketing Research. Chicago: American Marketing Association, 1983.

USA International Business Publications. Doing Business and Investing in United Arab Emirates Guide. Int’l Business Publications, 2007.

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