Market Analysis is research on any market that aims to anticipate or predict the direction of prices or growth. A market analysis of a stock, bond, or commodity market tries to forecast which way prices will go.
Most analyses focus on what is to come, i.e., they are forward-looking. However, some try to understand or explain why something has happened, i.e., they examine the history.
People carrying out market analyses use technical data about the movement of, for example, the stock market or commodity prices.
Sometimes market analysis requires studying fundamental data such as supply and demand or corporate earnings prospects.
AI and machine learning
Recent advancements in artificial intelligence and machine learning have significantly enhanced the accuracy and predictive power of market analysis, allowing analysts to uncover deeper insights and trends.
Market analysis – the marketplace
Often, market analysis involves studying and defining a company’s market and trying to determine its direction.
The study may also look at how a company can exploit that market to gain a greater share.
We can use this type of analysis to analyze our current market or to look at new ones.
No matter the size or age of a business, market analyses help identify the attractiveness of markets. They also help business people detect risks that may exist or possibly will exist in the future.
Typically, the first thing to do in market analysis is identify your markets. Most businesses are in more than one market. For example, a small restaurant, apart from being in the restaurant market, may also be in the delivery, events, and bar markets.
What is a market?
A market is a place where businesses and people gather to purchase and sell goods and services. It may be a physical place, such as a store, flea market, or farmers market.
However, a market may also be an abstract term that refers to all the possible buyers. For example “The private vehicle market grew by 2% last year.”
SWOT analysis and market analysis
Through this type of analysis, a company can identify its SWOT.
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. Its strengths and weaknesses are a company’s internal factors while its opportunities and threats are its external factors.
We can control internal factors but not external ones.
A SWOT analysis can help a company define an adequate business strategy.
Market analysis – example sentences
Below are some example sentences containing “market analysis,” to help you see how we can use the term in context:
- “Before launching the new product line, the company conducted an extensive market analysis to identify potential customer segments and pricing strategies.”
- “The consultant’s market analysis report suggested there was an untapped demand in the region that could be addressed with targeted marketing campaigns.”
- “Investors often rely on market analysis to gauge the health of various sectors and make informed portfolio decisions.”
- “Market analysis tools have become more sophisticated, incorporating geospatial data to understand regional buying patterns better.”
- “During the quarterly review, the sales director presented a market analysis that showed a shift in consumer preferences toward eco-friendly products.”
- “The startup used market analysis to find a niche in the crowded marketplace, allowing them to position their offering more effectively.”
- “A thorough market analysis revealed that while there was significant competition, there were also opportunities for differentiation through improved customer service.”