Cross-border e-commerce market capacity analysis: methods and significance
Market capacity analysis is an integral part of the business planning and development process of cross-border e-commerce companies. Market capacity, that is, market size, refers to the overall size of the target category or an industry. It is mainly determined by three aspects: consumers, purchasing power, and purchasing desire.
The significance of market capacity analysis
Market capacity analysis not only helps us understand the current situation of market size, but also determines the scale bottleneck of this category or industry, that is, the upper limit of enterprise development. The higher the upper limit, the greater the market capacity and the higher the bottleneck. Therefore, for cross-border e-commerce companies, analyzing market capacity can help guide companies to choose appropriate target markets.
Although larger market capacity usually means greater opportunities, it does not mean that companies should blindly pursue large-scale markets. On the contrary, enterprises need to choose markets or develop market strategies based on their own strength and development stage. Strong companies should choose markets with larger market sizes to gain more competitive opportunities and expand their scale; while weak or emerging companies can choose markets with relatively small market sizes to avoid risks and preserve their strength.
Methods of market capacity analysis
Market capacity analysis can be conducted from multiple perspectives, including but not limited to annual transaction volume and proportion, year-on-year transaction volume and growth, and the number of sellers.
Annual transaction volume and proportion
By analyzing the transaction amount and proportion of the secondary category market over a period of time, the size of the target category market can be compared and analyzed. These data can be presented through the visualization of pie charts to make the information more intuitive.
Annual transaction volume month-on-month and growth rate
Further, analyzing the month-on-month and growth rate of transaction amounts in the secondary category market over a period of time can help determine the development prospects of the target category market. Growth is usually represented using a line chart or a Boston matrix chart. The Boston matrix chart uses the market average as the dividing line to divide the selected categories into four categories, and draw a four-quadrant chart to view the position of each secondary category in the matrix.
Number of sellers
In addition, analyzing the number of sellers in the secondary category market over a period of time can reflect the saturation of the category market, thereby helping companies determine whether it is suitable for new sellers to enter.
Analytical ideas
Clear capacity analysis thinking, take the transaction amount as the starting point, and analyze the performance of the transaction amount in the two dimensions of “proportion of first-level categories” and “increase”. Analyze market saturation based on the number of sellers in this category.
Analytical methods
In order to make the data conclusions more intuitive, vivid and vivid, graphic methods can be used to visualize the indicators. For example, data can be displayed through a series of statistical graphics such as column charts, line charts, scatter charts, etc. for better data analysis. In addition, the comparison method can also be used to compare the transaction amount and number of sellers in each market to judge the market capacity.
In summary, through a variety of analysis methods and technical means, cross-border e-commerce companies can more comprehensively understand the capacity of the target market and provide strong support for formulating effective market entry strategies.