Calculate customer demand
Working out customer demand – how much might you sell?
View transcript for Episode 16 - Work out customer demand – how much might you sell? recording
What are your customers like?
Firstly, build a picture of who your current customers are. Consider their age range, gender, income or spending power. Think how they buy your product, perhaps it’s online or in a shop? And finally ask why they purchase it - is it a luxury item or a necessity?
Compare your customers
Then do research to see if there are customer similarities between your existing ones and those in the target market. Use online resources, such as country fact sheets to determine the numbers of potential buyers.
Statistics and consumer opinion
Following this you should investigate import statistics. How do they compare with local suppliers and what is consumer opinion? You can also find information in social media, blogs and forums.
Business analytics
Finally, revisit your own business. Use analytics on your website to see where visitors are from. You may discover that some consumers are from a country that hasn’t been able to provide what they need locally.
What you’ll learn
- areas you should research online when working out how much you can sell
- how you can use your website's analytics to help work out demand
- where to check if there’s a customer base for your product in your target market
Knowing your customer
Understanding the people who use your product is key. This includes factors that affect their spending power or choice. Knowing this can help you to work out potential demand in foreign markets.
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Gather information on your current users
Start off with your knowledge about your customers here in the UK. You’ll want to consider:
- their age range
- gender
- income or spending power
- how they buy your product – online or in a shop?
- why they purchase – is it a gift or a necessity?
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Research these features in your chosen market
Use online resources, such as country factsheets, to determine if a similar customer base exists, the number of potential buyers and their spending power.
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Look online at statistics and consumer opinion
You can find a lot of useful data online. Many countries publish import statistics. Can you find the import statistics for your target market? What about their local sales for your product?
Another good option is to look at social media, blogs and forums for consumer opinion. If you have a language barrier, try using a free online translation service.
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Review your own business insight
Often, there’s a lot of valuable information that you already have. You might already be aware of this information, but it’s worth revisiting.
You can use the analytics of your website to see where visitors are from. This might indicate that customers in that market haven’t been able to find what they’re looking for locally.
It’s also worth tracking the number of enquiries you receive, and from which countries.
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Adjust for internal and external factors
Once you work out the level of demand, consider what else might impact how much you'll sell.
Some of these will be related to your company’s capabilities. How much money and resource can you spend on training of personnel, trips to market, certifications, local marketing? Think about the level of competition. Can you match prices after paying for transport, insurance and customs duties? How easily can you access distribution channels?
Other factors might be outside your control. Could the political, economic and social stability of your target market change how much you sell? How might the climate affect your product?
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