Other factors to consider

In addition to attractiveness, evaluating market segments also considers the political, social and environmental factors that influence the segment. Regulating or de-regulating a market is in the domain of governments and their political structures. Changes in society can give rise to new segments, and environmental factors can exert both positive and negative influence on an industry and its subsegments.

All the above considerations must be compared against the company’s ability to deliver for these segments. A market can be extremely attractive according to the research and analysis, but it may still be outside of the company’s capabilities to serve it. Capabilities are measured in the company’s opportunity to exploit its strengths – manufacturing capacity, brand, distribution networks; have access to low cost raw materials, labour or technology; superior technologies that allow for better quality product; or leadership capabilities and commitment that can make the company a leader or a failure.