Market development

In microeconomics, market development is understood to mean all changes in market data that have occurred or will occur in a specific market or a specific market segment .

General

The market development is of great importance for the market participants , but also for other interested parties ( market research , analysts ) and must therefore be examined permanently. It can be examined with the help of conventional analysis methods . A total analysis deals with the entire market, the partial analysis examines sub-areas. Special forms of analysis are scenario analysis or weak point analysis . The size of the markets depends on the market volume ( turnover ). For example - after a decreasing market volume - the labor market ,Capital market , money market , consumer markets , grocery store or confectionery market object be an analysis of market development.

Market analysis

For example, if a market analysis examines the confectionery market (2014: € 14.38 billion market volume in Germany) in more detail, there are the market segments of the chocolate goods market (€ 5.26 billion market volume), sub-segments of the latter are in turn "filled tablets and bars " ( € 1.302 billion market volume) or white chocolate (€ 69.1 million market volume). Market data are market volume , market form , price , product life cycle , supplier and customer and purchasing power . The result of the analysis are business indicators . This includes in particular

${\displaystyle {\text{Marktvolumen}}={\text{Inlandsproduktion}}+{\text{Importe}}-{\text{Exporte}}}$

${\displaystyle {\text{Marktanteil}}={\frac {\text{Umsatzvolumen}}{\text{Marktvolumen}}}\ \cdot 100\,\%}$

${\displaystyle {\text{Marktsättigung}}={\frac {\text{Marktvolumen}}{\text{Marktpotenzial}}}\ \cdot 100\,\%}$

${\displaystyle {\text{Marktpotenzial}}={\text{(Zahl der Verbraucher)}}\,\cdot \,{\text{(Kaufmenge je Beschaffungsakt)}}\,\cdot \,{\frac {\text{Kauffrequenz}}{\text{Jahr}}}\,\cdot \,{\text{Zyklusdauer}}}$

In a company, market analysis is of great importance for the company's success. It comprises four analysis steps:

1. Analysis of the relevant target market, distribution of market shares (past analysis );
2. Structure of the demanders' needs: what is demanded ( product properties ), how is demanded ( buying behavior ), market power of buyers and providers (analysis of market structure );
3. Market phases as specific development stages of a market ( growth market , saturated market , shrinking market , cyclical market );
4. Forecast of the market potential (future analysis).

Misjudgment of market development

An incorrect assessment of the market development can lead to considerable economic consequences for the company concerned. Unexpected shifts in demand lead to a drop in sales and thus a decline in profits or increases in losses up to a corporate crisis , delayed or not implemented product variations or product innovations lead to the same effect. So did Henry Ford lost the relationship with the market trend, when his company Ford did not respond at the beginning of the 1920s to the customers' demands for more comfortable, heavier and closed car. As a result, the company had to cease operations for almost a year in May 1927. Barings Bank's losses of GBP 1.4 billion in February 1995 can ostensibly be classified as market risk , since the interest rate and index speculations of their trader Nick Leeson were based on the wrong assessment of market developments. This led to the bank's insolvency in March 1995 .

Individual evidence

1. ↑ Notger Carl / Rudolf Fiedler / William Jorasz / Manfred Kiesel, BWL compact and understandable , 2008, p. 14 f.
2. ↑ Bernd Camphausen, Strategic Management: Planning, Decision, Controlling , 2013, p. 74 f.