Dove’s award-winning #SpeakBeautiful campaign caused a 36.8% YoY decrease in negative tweets about beauty or body image. It was also a huge win for the brand, with over 168,000 hashtagged tweets, 800 million social media impressions and a 17% increase in brand sentiment.

They used social media to find that in a single year, women posted 5 million negative beauty or body image tweets. This was an opportunity to change the hurtful narrative and improve the brand image.

Market opportunity analysis can do both: help your business grow and bring a meaningful, positive change into the world. In this guide, you’ll learn how to conduct one and find some inspiring examples.

What is market opportunity analysis?

Market opportunity analysis is a type of market research. The point is to see how and where you can grow your customer base or revenue. Conducting a market opportunity analysis involves identifying competitors, understanding your target audience and uncovering weaknesses, opportunities and threats.

During this process, you’ll come up with new business ideas and be able to prioritize them based on their potential to bring profit or risk.

Why should you conduct a market analysis?

Market opportunity analysis gives your company a competitive advantage by allowing you to find new business areas with growth potential or where to expand in your current market. It allows you to:

• Make better-informed decisions
• Improve your long-term marketing strategies
• Evaluate product or service demand
• Identify potential for business growth
• Uncover your strengths, weaknesses, and areas for further research
• Find and mitigate potential risks

Now, let's find out how to perform your own market opportunity analysis.

How to conduct a market opportunity assessment

Identify opportunities you want to analyze

The first step is identifying what kind of opportunity or product you want to analyze. Some ideas include:

• A new product or service
• A new market to expand into
• A business partnership
• An unmet customer need
• An improvement of something already in your offer or on the market
• Horizontal improvement for multiple operations
• A new niche uncovered by a shift in external factors

Get to know your (target) customers

Assessing your target customers is essential when exploring any product opportunity. If there are no buyers, what's the point of selling? Some questions you need to answer are:

• Is your product or service attractive or solves a particular pain point?
• What factors go into your target audience's purchasing decisions?
• Are they willing and able to spend enough on this idea for you to make a profit?

You can take two routes to make informed business decisions based on market research.

If you already have customers…

If you already have a customer base of any size, you can collect feedback directly to learn about their specific needs and preferences. The best way to do this is with a product discovery tool like Zeda.io.

It’s a robust platform for collecting feedback and finding new ways to grow.

You can do this by setting up a customer portal on your website. It's customizable, so you can make the theme match your brand. You can also make it a widget for your customers to ask for your guidance easier. Alternatively, send forms to collect various type of feedback directly from the user feedback tool to customers or internal teams.

You get a dedicated feedback panel to sort queries, feature requests and complaints. The AI-powered dashboard identifies and groups similar feedback, generating tags based on your workflow. It helps you analyze customer feedback to find highly demanded features to build next.

Zeda.io's AI product intelligence uses machine learning to analyze sentiments, customer segments, revenue and other data points. The dashboard displays the collected information as comprehensive, actionable insights.

With this feedback platform, you can also define goals and plan your roadmap to reach them. You can visualize your journey with our strategy maps created to give you clearly illustrated context. Connect OKRs to your business model plan to easily measure the outcomes as you go.

If you don't have customers yet…

The approach we described isn't possible if you're just starting or venturing into a new business area. In such cases, focus on:

• Keyword research: Great tools to discover what products your potential customers are looking for include Google Keyword Planner, SEMrush or Ahrefs. Start with a seed keyword related to your industry. Generate relevant keywords and phrases, then analyze their search volume and competition. Prioritize them based on relevance and popularity. Long-tail keywords are more valuable as they indicate more focused customer intent.
• Smoke test landing page: This is a minimalistic web page for validating your product idea without fully developing it. You can build it with Wix, WordPress or Unbounce. Share it on social media, online communities, through email marketing campaigns and targeted ads. Track user behavior, number of visitors, conversion rates and sign-ups to measure the level of interest in your idea.
• Social media: Social media monitoring tools allow you to track conversations about your industry and related keywords. Identify your main competitors and influencers who cater to a similar audience – their followers are your potential buyers. Observe them and participate in the online conversation to get a feel of the current industry trends and get noticed by others.
• Online reviews: Dive into reviewing platforms like Yelp, Amazon, Google Reviews or relevant industry-specific sites. Look for recurring themes in what people like, dislike and what problems they encounter. You can even respond to these comments asking about further details or presenting your product or service as an alternative they can check out.

Analyze your competitors

We already briefly touched on basic competitor research when talking about doing a social media market assessment. Now, let's dive deeper into it.

Start with a simple Google search of your direct competitors who offer similar products or solve the same customer pain points with different solutions. Look for those companies on software reviewing sites like G2 or Capterra. There, you can see client reviews and compare features.

The next step is deeper research, which will help you navigate the competitive landscape. To get this information, follow your main competitors on social media, subscribe to their newsletters and keep yourself updated. Factors you should look into include:

• The product, its features and use cases
• The target audience and user persona
• Their go-to-market strategy – marketing channels, collaborations, ads, publishing frequency, taglines, language, category names
• The pricing structure – free trials, freemium options, setup costs
• Their technology infrastructure and data ecosystem
• Their market share and size

We suggest performing a SWOT analysis for each competitor, which includes Strengths, Weaknesses, Opportunities and Threats.

A great point of reference to sum up your competitive analysis is battle cards. List each competitor's main strengths, weaknesses, overlaps and differences. Here's an example of what that can look like:

Another way to illustrate your competitor research is with a simple spreadsheet. Include columns about all the most valuable data we've mentioned. Add a row with your own company. This view can help you identify your uniqueness and find gaps in your niche that the existing market isn’t addressing.

Consider external and internal factors

External factors

Six external factors can impact your new market opportunity (think PESTLE):

1. Political: Tax, government policy, trade laws, political stability, industry regulations, global trade situation
2. Economic: Exchange rates, globalization, economic growth or decline, inflation, interest rates, cost of living, labor costs, working hours
3. Sociological: Cultural norms, fashion, population growth rate, age distribution, health consciousness, career attitudes, work-life balance, consumer spending habits
4. Technological: Automation, innovation, social media and networking, robotics, AI, online security, disruptive technologies
5. Legal: Employment law, common law, labor law, health and safety regulations, importing and exporting laws and taxes
6. Environmental: Global warming and the rising need for sustainable resources, ethical sourcing, pandemics and other emergencies, supply chain intelligence, government environmental restrictions, CSR

To perform a PESTLE analysis of the current economic climate in your area, rate the impact level of each of these factors (e.g., on a scale of 1-5). Next, list the steps you will take to overcome each of the potential roadblocks you uncovered with this method.

Internal factors

Consider your capabilities, strengths and weaknesses. Ask yourself these questions:

• Do you have the technology and workforce necessary?
• Do you have enough financial resources for the endeavor?
• Are your teams skilled enough to take on the new challenge?
• Are you able to hire new people with the necessary skills?
• What new departments will you need to create?

Identify and prioritize opportunities

Sift through the opportunities you've found to get your ideas in order and find the best ways to grow into new markets. Some of the most popular prioritization frameworks you can use for this include:

• RICE: Intercom's scoring system measures each idea against four factors – reach, impact, confidence and effort. Assign each of the components a number between one and 10. To calculate the RICE score, follow the mathematical equation of (R × I × C)/E. It’s an unbiased way to judge which projects are worth your attention first.
  

• Value vs. Effort Framework: This is a simplified version of RICE. It helps to judge ideas based on their value to customers and the effort it costs the organization.
  

• KANO model: This framework weighs the customer satisfaction level against the implementation cost on a horizontal and vertical axis.
  

• MoSCoW: This is an acronym for “Must-Have, Should-Have, Could-Have and Won't Have” – a pretty self-explanatory division of features.
  

With Zeda.io, you can choose between the RICE or Value Effort Framework to easily score and prioritize business ideas based on their value. If neither works well, you can set up your customized framework, like the ones we illustrated above. Our dashboard allows you to sort any list of features based on the score you give them – how you calculate it is up to you.

Market opportunity analysis: Real-world examples

Don't take our word for how effective market opportunity analysis can be – just take a look at these examples.

Zoom

For collaboration companies, a disruptive external factor (i.e., the pandemic) was a chance to grow exponentially. The market demand for remote collaboration and video conference tools was huge. Just look at the global interest peak right around the lockdown period.

Image source: Google Trends

Tech entrepreneurs leveraged this opportunity to launch or grow their remote tools. Although this unsteady time was disastrous for many businesses, Zoom's revenue skyrocketed throughout 2021.

Starbucks

You don't have to wait for another world-changing event to create a market niche. True – Starbucks has it easy because coffee is always in demand. However, they wouldn't have grown as they have without solid market research.

The way they achieve this is with their Idea Platform, launched back in 2008. It allowed their customers to make their voices heard and develop the company while building a stronger relationship with it.

Here are some of their implemented ideas:

• Splash sticks for keeping clothes cleaner
• 3 million mobile payment transactions weekly
• New flavors
• 5.8 million cake pop treats sold yearly

Conclusion

Not all ideas are worth executing, but each is worth examining. Many of the best business ideas aren't the most obvious ones. Take your time to brainstorm and sift through ideas with a robust market opportunity analysis to discover if your business idea is practical and profitable.

The easiest way to find new features and solutions your audience will love is with a product discovery tool like Zeda.io. Use it to collect and manage feedback, prioritize business ideas and build actionable roadmaps for your teams. The results we've noted with our customers include 20% smaller churn rates and 50% of sales growth.

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