The market analysis method is divided into two major steps: market assessment and competitive product analysis.
Market evaluation, that is, what kind of market has potential, or in which field should I choose products? Before answering this question, three concepts of economics need to be introduced: perfect competition market, oligopoly market , monopoly market.
Perfectly competitive market refers to a market structure in which competition is sufficient without any hindrance or interference. In this type of market, there are many buyers and sellers, buyers and sellers are price takers, resources can flow freely, and information is complete.
Oligopoly market, also called oligopoly, refers to a market structure in which the production and sales of a commodity are controlled by a few large manufacturers.
A monopoly market refers to a market organization in which there are only one or a few manufacturers in the entire industry. Specifically, there are three main conditions for a monopoly market:
① There is only one or a few manufacturers and products sold in the market;
② The products produced and sold by this manufacturer There are no close substitutes;
③It is extremely difficult or impossible for any other manufacturer to enter this industry.
Referring to the above description of the three market types, we use the Amazon platform to determine what kind of market the market is based on factors such as the number of reviews of each product, the number of search pages, and the time the product was put on the shelves.
Search for “casualsoft sweater cardigan” under the “men” category. The first 3 rows of product screenshots of the page displayed. There are 400 pages in this category. (Note, be sure to select the category instead of “casualsoft sweater cardigan” when searching. The default is “AI1”, otherwise only 7 pages of search results will be displayed) We can find that this market field has the following characteristics:
(1) The top product styles have a high repetition rate, such as button V-neck styles. There are a total of 4 models of men’s sweaters, sold by 2 different brands (competition is fierce, product information is repeated, that is, the selling points of the products are almost the same, and the prices are transparent)
(2) The number of reviews of the top products is relatively evenly distributed. , there is no phenomenon of concentrated reviews and comments on a single listing (buyers have no obvious preference to buy reviews and the reviews are evenly distributed)
(3) There are a large number of search pages, a total of 65 pages (there are many sellers and many competitors). ).
It can be seen that the Amazon category market can be classified as a perfectly competitive market.
The first page displayed when searching for “ruffle hem sweater” under the “women” category. 3 rows of product screenshots. There are 8 pages in this category. We can find the following characteristics in this market field:
(1) The duplication rate of top products is low (the product information is not repeated and the competition is not fierce enough) ).
(2) The number of top product reviews is concentrated on a few products, and other products have no product rankings and no order volume.
(3) The number of search pages is small (sellers). (smaller number of people).
It can be seen that this Amazon category market can be classified as a monopoly market. This picture shows the first page of the page displayed when searching for “loose fit denim acket for women” under the “women” category. 3 lines of product screenshots. This category has a total of 59 pages. We can find the following characteristics in this market field:
(1) The top products have a duplication rate but a low duplication rate (there are competitors) Competition but not intense)
(2) The number of top product reviews is concentrated on certain products, but other products can also receive a small number of reviews, and all have good product rankings (buyers There is a certain purchase preference, but the preference is not strong enough).
(3) The number of search pages is moderate, with 59 pages (the market competition is between the perfect competition market and the discontinued market).
It can be seen that this type of Amazon market can be classified as an oligopoly market.
According to the basic description of the three market concepts, there are two different product selection strategies for large sellers and small sellers. < /p>
For large sellers (that is, companies or organizations that have their own supply chain and production system and can produce products independently without relying on suppliers) or brand Amazon stores, there are 4 market strategies.
The best strategy is to attack the market gap and become the dominant player in the monopoly market. For big sellers with supply chain advantages, entering the blue ocean market first can not only harvest a large amount of early search traffic, but also complete product production in the shortest time. Relying on its own supply chain, price, brand and other advantages, through later operations, it can completely encroach on the potential competitors’ markets one by one, and finally obtain a market monopoly;
China’s strategy is to attack the oligopoly market and strive to improve quality Defeat opponents in terms of service, service and operation optimization. When competing for oligopoly market share, product selection itself is not particularly difficult, but it often requires a large upfront cost. Correspondingly, once a product establishes a firm foothold in the market, it can steadily earn profits. Therefore, when choosing to attack the oligopoly market, you must have a clear understanding of the life cycle of the target product to ensure that the return in the later period is much higher than the initial investment;
The next best option is to enter a fully competitive market that has no market gaps. , because there are many competitors in this type of market, prices are transparent, product quality and services are basically the same, and the gap cannot be widened. The products in this type of market are mature enough and lack room for improvement, making it difficult to leverage their own advantages. At the same time, there are often a large number of small sellers with diverse product portfolios and services, which makes it difficult for customers to choose from a wide range of choices when purchasing, and it is difficult to obtain poor information; the next best option is to enter a monopoly market controlled by other large sellers, even if Big sellers will also have to pay a high price to shake up a monopoly in a monopolized market, and this is what operators should avoid.
For small sellers (that is, small teams that do not have their own independent production lines and supply chains and can only purchase products for sale through third-party manufacturers) or non-branded Amazon, there are also four market strategies: < /p>
The best strategy is to attack the non-standardized market gap, which is commonly known as “small but beautiful”, and use the information gap to become a monopoly seller in a certain niche field in the niche market (such as small handicrafts, clothing products) Because these products will not produce huge quality differences, they can easily meet market demand in the early stage, and can maintain a certain market share even if large sellers enter the market later;
The middle strategy is to enter a perfectly competitive market. Although the market is transparent and competitive, It is fierce, but the gap between the competitors is not big. Small sellers can get a share of the pie as long as they polish the details;
The next step is to attack the oligopoly market of standardized products, such as the 3C market, and the reputation of big sellers and services have become a system, and it is almost impossible to survive without the influence of brand stores and a supply chain;
The next best option is to enter a monopoly market controlled by big sellers, because product quality, after-sales service The market rules for services are set by big sellers, and the entry of small sellers is tantamount to hitting an egg with an egg.