Market studies are among the most important documents for assessing a company's likelihood of success — they define future plans, evaluate the market environment, and identify potential customers and revenue sources. They are part of the marketing feasibility study that presents your product to the market and target customers.
Elements of a market study
Describe the industry or product
Give a brief description of the industry; defining it is essential to attract investors and win contracts and grants.
Analyze the current market
Describe the current market for your product. If it's unique with little data, run your own surveys and customer polls. Any evidence of demand helps convince investors.
Competition
Identify current and potential competitors and analyze their locations, hours and longevity. Note similar businesses that recently closed to understand why (location, taxes, weak demand). Competitor research shows what works and what doesn't.
Future market potential
Attach data and charts showing trends and projections, and base your forecasts on facts by studying similar successful companies.
Potential revenue sources
Leverage available market research and press releases from large companies in your field to understand industry trends and new product lines.
Sales forecasts
Estimate sales considering the time and money invested and the markets targeted — challenging for new ventures but essential.
Market study vs. marketing plan
A feasibility study is an evaluation tool that weighs pros and cons and analyzes multiple scenarios to see whether the idea will work. A marketing plan defines specific strategies and campaigns to execute based on the study's findings — the study is evaluative, the plan is a defined course of action.
After gathering and analyzing data you can size the market gap and the project's market-entry opportunity, decide to enter when the opportunity is favorable, then move on to the technical study.