Recognize and
Understand the
Market
Prepared by:
ALMA D. MENDOZA
Subject teacher (Entrepreneurship)
Objectives:
1. Describe the unique selling proposition and
value proposition that differentiate one’s
product/service from existing products/services.
2 . Determine who the customers are in terms of:
a. Target market
b. Customer requirement
c. Market size
What is Unique Selling Proposition (USP) and
Value Proposition (VP)?
These two allows the entrepreneur to
prepare himself on how to advertise and
sell his product even if it is similar to
others.
Value Proposition (VP)
-is a business or marketing statement that
summarizes why a consumer should buy a
company's product or use its service.
This statement is often used to convince a customer
to purchase a particular product or service to add a
form of value to their lives.
In creating Value Proposition,
entrepreneurs will consider the
4 basic elements:
Target Customer
Needs/opportunity
Name of the product
Name of the enterprise/company
Example:
Aling Charing Sari-Sari Store opens only from 6:00 am
to 6:00 pm, but Aling Charing noticed that there are
customers who go to a nearby town to look for a
convenience store at around 10:00 pm to 6:00 am. She
believes that this is a great opportunity for her store to
operate 24/7. In this example,
the proposed value proposition is:
“Charing sari-sari Store, open 24/7”.
Canva
Canva's value proposition focuses on the concept that
anyone can create professional-looking designs. The
graphic design platform makes it easy to create social
media graphics, posters, presentations and other
visual content. The company's value proposition explains
how it can help customers design these different types of
content to meet their needs.
Value proposition: Design anything
Spotify
Spotify has several value propositions related to
accessibility, customization and performance. On its
app, users can access millions of new and classic
songs and podcast episodes, create and share
playlists or download and listen to music offline. The
company's value proposition statement emphasizes
customers' ability to access and customize their
music for an optimal listening experience.
Value proposition: Accessibility and
customization
Vimeo
Vimeo's value proposition states that it gives
consumers the ability to design and share high-
quality videos. With its simple tools, the company
offers the assurance that it can help both aspiring
and experienced videographers create unique
content. Its value proposition describes how the
company can help customers make quality videos in a
simple way.
Value proposition: The power of video at
your fingertips
Unique Selling Proposition (USP)
-refers to how you sell your product or
services to your customer. You will address
the wants and desires of your customers.
Some tips for the entrepreneur on how to create
an effective unique selling proposition to the
target customers are:
Identify and rank the uniqueness of the
product or services character
Be very Specific
Keep it Short and Simple (KISS
As an entrepreneur, present the best feature of
your product or service that is different from
other competitors. Identifying the unique
selling proposition requires marketing research
the proposed unique selling proposition is:
“Charing sari-sari store, open 24/7
Domino’s Pizza
Differentiating a pizza company from others might be a
challenging task. However, years ago, Domino’s came up
with the famous USP that made them known to many
people. Typically, pizza deliveries take long, but
Domino’s made a bold promise of free pizza if the
delivery exceeds 30 minutes.
unique selling proposition is:
"You get fresh, hot pizza delivered to your
door in 30 minutes or less—or it's free."
Starbucks
The real success behind Starbucks is going beyond coffee.
It’s getting people to connect various positive things in
daily life with “Starbucks” coffee. For some people, it’s a
good chat and tasty coffee with friends; for others, it means
the right way to start a busy workday.
unique selling proposition is:
"Expect more than a coffee.”
M&M
The famous candy brand M&Ms stands out among
other similar candies by highlighting its hard sugar
coating that preserves the chocolate inside and
prevents melting in one’s hand. I told you there was
no sticky business.
unique selling proposition is:
"Melts in your mouth, not in your
hand."
How Long Should a Unique Selling
Proposition Be?
An ideal Unique Selling Proposition (USP)
should be no longer than one or two
sentences. Keep it short and sweet.
ADDITIONAL NOTES
Unique Selling Proposition and Value Proposition are two of the
most famous tools used to explain why prospect customers buy
each product and service.
Based on each definition, we learn that USP and VP are
frameworks of each business industry.
The two propositions are valuable for the entrepreneurs.
Make sure that you're focusing on a solution that is a need, and
make sure that you are targeting a customer segment that's large
enough and cares enough about your solution
How would you differentiate between a value
proposition and a unique selling proposition?
The Value Proposition is what you are offering to customers
for what they are paying.
The Unique Selling Proposition, on the other hand, is why
customers should buy from you instead of someone else. It's
more about creating that emotional connection with your
customers.
Understanding your market
>>>>There are three factors that will determine your customers.
1. TARGET MARKET
2. CUSTOMER REQUIREMENTS
3. MARKET SIZE
A. Target Market
Market Targeting is a sage in market identification
process that aims to determine the buyers with
common needs and characteristics.
Prospect customers are a market segment that an
entrepreneurial venture intends to serve.
Target marketing allows you to focus your marketing
money and brand message on a specific market that is
more likely to buy from you than other markets.
Methods for Segmenting the Markets
1. Geographic segmentation – the total market is divided
according to geographical location.
Variables to consider :
a. Climate
b. Dominant ethnic group
c. Culture
d. Density (either rural or urban
Methods for Segmenting the Markets
2. Demographic Segmentation- – divided based on consumers
Variables to consider
a. Gender
b. Age
c. Income
d. Occupation
e. Education
f. Religion
g. Ethnic group
h. Family size
Methods for Segmenting the Markets
3. Psychological Segmentation – divided in terms of how customers
think and believe
Variables to consider
a. Needs and wants
b. Attitudes
c. Social class
d. Personality traits
e. Knowledge and awareness
f. Brand concept
g. Lifestyle
Methods for Segmenting the Markets
4. Behavioral Segmentation – divided according to
customers’ behavior pattern as they interact with a company or
product.
Variables to consider
a. Perceptions
b. Knowledge
c. Reaction
d. Benefits
e. Loyalty
f. Responses
B. Customer Requirements
Customer requirements are the specific
characteristics that the customers need from a
product or a service.
There can be two types of customer
requirements:
1.Service Requirement
2.Output Requirement
B. Customer Requirements
Service Requirement
An intangible thing or product that cannot be touched but
the customer can feel the fulfillment.
Elements in service requirement
on-time delivery
service with a smile
easy-payment
It includes all aspects of how a customer expects to be
treated while purchasing a product and how easy the
buying process goes
B. Customer Requirements
Output Requirements
Tangible thing or things that can be seen.
Characteristic specifications that a consumer expects
to be fulfilled in the product.
Example:
Customer buys gadgets (phone speaker) the specification
like the loudness and clarity are the output requirements.
C. Market Size
The entrepreneur’s most critical task is
to calculate the market size, and the
potential value that market has for their
start-up business.
Market research will determine the
entrepreneurs’ possible customers in
one locality
C. Market Size Aling Charing’s Sari-Sari Store
There are a total of
2000 students at St.
Louis College
1000 students do
not eat breakfast
500 students love rice
porridge
*Figures are invented for discussion purposes only
C. Market Size
Methods in determining the market size:
The first step is to estimate the potential market – approximate
number of customers that will buy the product or avail your
services.
The second step is to estimate the customers who probably
dislike to buy your product or avail the services.
The third step is for the entrepreneur to estimate the market
share, that means plotting and calculating of the competitor’s
market share to determine the portion of the new venture
Example of a Market Share
Airline industry
*Figures are invented for discussion purposes only
C. Market Size
* In determining the market
size, the entrepreneur will
conduct a strategic marketing
research from reliable sources
WHAT I HAVE LEARNED:
Entrepreneurs will take a look at each customer’s demand in the market.
Understanding your market will help reach your goal to compete with
bigger competitors. Building positive relationships with customers require
more understanding in customers’ purchasing motivations and habits.
_________ and __________ basically join VP hand in hand to USP
promote its
product and services. ____________________is a sage in market
identification
MARKET process that aims to determine the buyers’ common needs and
TARGETING
behavior. There are four (4) methods for segmentation,
____________________, ____________________, GEOGRAPHIC
DEMOGRAPHIC
______________________, PSYCHOLOGICAL
and _____________________. There are two
BEHAVIORAL
types of customer requirements, the ___________________ and
_________________,
SERVICE the tangible
OUTPUTand intangible
APPLICATION ACTIVITY:
Give at least 5 products being advertised or promoted on television. Evaluate each one
according to its USP, VP and method of segmentation used, customer requirements,
and who are the customers.
SOURCES:
ENTREP12_Q1_M3_RECOGNIZE AND UNDERSTAND THE MARKET.pdf
GE RA LD TV. “Recognize and Understand the Market”. https://www.youtube.com/watch?v=VWC2V8pScfA
