Segments and players
In this stage of your market research, you start digging deeper into your selected target market, to find out where (and if!) there is a match between the demand and what you offer. This means finding out relevant segments for your products, and identifying players active in that segment.
Finding the segment for your product
A segment is a cluster or group that shares common characteristics. These clusters can be defined for instance by looking at:
- Price and quality: where the premium consumer segment has high prices and quality, in small volumes, as opposed to the low consumer segment at lower prices, less quality and bulk volumes.
- Demographic clusters: targeting children for example, or the growing group of active retired people, or perhaps small households in small living spaces.
- Stage in the distribution channel: where a product can be aimed at the final consumer (fresh oranges or final t-shirts for instance), or one step earlier in the channel for final processing (for example oranges for juice or fabrics to be part of final garments).
- Mainstream or sustainable niche: certified sustainable products, such as organic and fair trade, are specific segments. While still smaller market shares than mainstream, especially organic food has a share which is no longer a small niche and continues to increase.
The starting point when looking to identify your segment in a potential target market, is the current segment you supply to. If you supply input for further processing, this segment probably offers the best opportunities for you also in new target markets. And if you produce for the luxury consumer segment, start by checking out if your products fit in this segment also in your target market. Be aware that segments can be different in different markets, and have different characteristics. This could mean that, although in the same segment, the quality requirements or price levels can differ between markets.
Identifying players in your target market and segment
Just as each market segment has its own characteristics and overall size in a market, there will be a number of players active within that segment, with their role (importer, wholesaler, retailer, etc), current assortment and their market share.
- Map out how your segment is structured: are there large players dominating the segment? In that case, you know that they will have quite a large influence on the overall segment and the type of products available. On the other hand, if the segment is characterized by many small players, you also know that traded volumes per player can be expected to be lower, and that products are likely to be diverse as different players choose differently.
- Relate the information you find out to your situation: Are the types of players present the sort of players your are looking to do business with? Are you able to supply in sufficient volumes? Do your products have the quality that is applicable in the segment?
Your first findings in the target market will provide direction for identifying actual prospects for you to do business with: you will know what type of players are active in your segment in the target market.
Get further support
Feel free to contact us at Open Trade Gate Sweden. We can assist you in collecting and sharing relevant market information on Sweden and Europe. Share your products and company, and be as specific as you can in your question in order for us to provide a relevant answer.