Identifying your audiences and assessing your markets

This Step and the next contain practical exercises that will help you identify the value in your idea and then express that value succinctly and persuasively. There isn’t time to explore these objectives in depth within the course. However, it’s important to make a start here, so you can start to develop your thinking patterns. You can then deepen your research and refine your value proposition over the months ahead, using your learning journal to keep track of your thoughts.

In this Step, you’ll explore how your IP can serve different audiences and discover practical approaches to researching potential markets and customers.

Innovation and novelty are core aspects of IP, and IP law is constituted so that it protects original intellectual creations. The challenge, when it comes to making money from your IP therefore, is that there is no guaranteed market because the idea is new. Uncertainty comes with the territory. Short of actually producing your idea and placing it before your potential audience, you won’t know whether it will be of value to them¹. So how do you discover whether what you create is going to be liked or wanted by potential customers? You’ll need to carry out some market research to try and answer these questions before you invest significant resources (ie time or money).

Identifying your market

First, you’ll need to identify the primary market for your product or service:

• Who would use it? You can segment your potential customer by age, lifestyle, interests, household constitution and gender.
• Why would they use it? For entertainment purposes? As an alternative to something that they may already be using?
• How and where would they use it? Would your customer have to go to a specific location (e.g. a cinema or concert venue); can they engage with it independently (e.g. a novel); is it something they can use on their phone (e.g. an app)?

It can be helpful to create a persona of your target customer. You can give them a name, a background and a context as a way to fully align your idea to a market. You’ll be prompted to do this in your learning journal at the end of this Step.

Organisations often spend a significant amount of time and money understanding their market. It’s important because it allows them to bring their products and services to their customers in the most efficient way possible (take a look at the links to some large market research organisations in the See Also section below). You can use the same approach as them, but instead of commissioning bespoke research, you can conduct your own using information that is publicly accessible; this is often referred to as secondary or desk research.

Here are some examples of freely available information. Take a quick look through them now and make a note of any you think will be useful to you in your learning journal.

• The Office for National Statistics gives insight into the size of different markets and into specific demographics such as age and household composition².
• The UK Government website publishes a vast amount of data on different economic sectors and trends. Use the search function to narrow down on the relevant sector. You can find out, for example, how many companies operate in the manufacturing sector in the UK.
• News Media – news brands such as the Financial Times often publish articles which include reliable data on business and the economy.
• Industry Publications – such as Harvard Business Review and Forbes Magazine – publish insights into different sectors and commentary on industry trends.
• Independent Research – many independent companies publish research on specific sectors or businesses. For example, the Publishers Association represents publishing businesses in the UK; they publish yearly statistics and insights regarding sales trends, sector revenue and market analysis.

Note that sources like the Financial Times require a subscription to access and you often need to be a member to access information from organisations like the Publisher’s Association.

It’s important to differentiate here between market and audience, as they are not necessarily the same. In many cases, the consumer (the individual buying the product or service) is not the same as the individual using it. For example, businesses providing products and services aimed at young children usually need to convince the parent or carer to buy for the child.

Assessing your market

Once you’ve identified the potential markets and audiences for your idea, you must assess whether they are viable opportunities. Some key considerations are:

• Market size: are there enough people who will want to pay for your product or service? For example, you may have an idea for a new product for men aged 25 – 40 who speak English. This is a substantial market. But if your product requires the buyer to have specialist knowledge to use it, how would that affect the market?
• Location: where is your customer located? Are they restricted to one region or country, or could your idea appeal to an international market? Would this consideration expand the market size sufficiently?
• Competition: are there other individuals and/or businesses operating in the same space as your idea? The answer is most likely ‘yes’, so you need to research what they are doing and how your idea may be different. What could you say to a potential customer that would entice them away from what they are currently doing or using?

Learning journal

Identify three different markets for one of your ideas. Using the steps above, consider which of the markets could offer the strongest opportunity. Create a persona for a target consumer in each market.

Undertake some research that links to your potential market. For example, if your idea is to create a new film, you’ll need to research the global market for films in similar genres and note down where there could be opportunities for your idea. This research will take longer than you have now, so make a note of any useful websites and resources from this Step that you can return to in the future.

References

1. Caves, Richard (2003). Contracts between Art and Commerce, The Journal of Economic Perspectives Vol 17, No 2 pp.73-84.
2. Palmer, Adrian (2012) Introduction to Marketing: Theory and Practice (3rd Edition) Oxford: Oxford University Press