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Market Research Services- Basic Approach Overview

DVIRC2905 Southampton RoadPhiladelphia, PA 19154

The Navy Yard Building 100 Innovation Center

4801 S Broad St, Suite 100 Philadelphia, PA 19112

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About Our Process:

DVIRC’s Market Research Approach Has Been Constructed To help Grow Our Client’s Business Value.

As such, our research is designed to help Businesses Pursue: Growth in Sales, Growth in Profitability and Success in Execution.

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The Roll of Market Research In a Competitive Strategy

In strategic planning it is highly recommended that components of Primary & Secondary Research be included as tools to:

Validate Perceived Organizational Strengths

Scout Out – Feasible Market Opportunities

Call out and/or Confirm Weaknesses & Threats

Define Competitive Landscape & Intensity

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Putting The Right Resources to Work….

Using the right tools at the right time makes our projects more impactful. We keep the following in our Growth Planning Tool Kit:

Primary Research / VOC- Current, Former & Prospective Secondary Research Pools/ Data Analysis Experts Category Analysis Experts and simple to use tools, (i.e. Boston Matrix) Expert Competitive Interviews, Competitive Analysis/ Five Forces International Market Perspectives and Insights Available Experts from RTI International, NIST and more

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Primary & Secondary Research can help answer common defining questions like:

Where are we?

What do we have to work with?

Where do we want to be?

How do we get there?

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We recommend defining your objectives then mapping an approach

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We Structure

Give yourself a defined schedule and stick to it!

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Moving forward With Primary Research:

Survey process involves: A.Defining Survey Groups

• Current/Former Customers• Competitors • Prospective Customers

• Current Industry • Industry and Market Scouting

• Industry leaders B.Survey Creation and Client Review / Approval/ Revisions.C.Survey Introduction to CustomersD.One-On-One customer surveying and data collection/ documentation.E.Real time data gathering and reporting F.Re-group on progress/address options surrounding elusive contactsG.Survey Findings & Analysis Report & PresentationH.Action Plan

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Primary Research is a great tool to help in understanding the value that the market places on your unique Value Proposition.

It can also enable you to move ahead quickly, leapfrogging situations that foster intense rivalry (or a race to the bottom with regards to price positioning).

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Design Your Survey Questions and Get Started

good

better

best

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Are there any areas in which our company falls short when compared to other suppliers?

What, if anything, we can do to win more of your business?“They tend to be pretty arrogant, it's their way or the highway, so they are not very customer-oriented. It is not any one individual. It is just their company philosophy.” Big Client, John Smith, Head Engineer

After the Outreach Aggregate your Data

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Generic Example of our Primary Research In Strategic Planning

Please note: Comments are copied verbatim and include grammar as received from survey respondents.

“I think if they continue the sales support and new product development, what they have been doing is great, but their backorder issues are always a hindrance.” (Fosters and Smith)

“Have more product available, not zero out my POs for lack of stock.” (All Pet Supply)

“The obvious would be not too many price increases, keeping their pricing competitive. Their packaging is wonderful. It's a good line; it's just a matter of placement and pricing.” (Royal Pet Supply)

Increase Increase Product Product

AvailabilityAvailability

Increase Increase Product Product

AvailabilityAvailability

“I guess maybe lower their minimums for ordering to help us. That would probably be the biggest thing.” (Nash Finch)

Competitive Competitive PricingPricing

Competitive Competitive PricingPricing

Lower Lower MinimumsMinimums

Lower Lower MinimumsMinimums

Add Larger Size Bags

Add Larger Size Bags

“Add larger size bags.” (Bradley Caldwell)

“Open up a warehouse in the Midwest. No, I am satisfied with Brown's and what they do.” (General Pet Supply)

ExpandExpandDistributionDistribution

ExpandExpandDistributionDistribution

What, if anything, could we do to win more of your business?

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Among wild bird product suppliers, 44% projected 5-10% growth.

Among companion pet product suppliers naming a growth rate, most projected 5-10% growth.

What are your 12-month growth outlook and strategy for the wild bird/companion pet categories?

Please note: Percentages may not add to 100% due to rounding.

Wild Bird Companion Pet

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Understanding Secondary Research:

Most of us are familiar with secondary research from doing library research with books and periodicals.

With secondary research, someone else has done the actual data-gathering in the field and has written it up in a form that's easier for you to use.

Secondary research is generally much less time-consuming and cheaper than primary research.

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What Do You Need to Know For Your Growth Plan? Start With a Look at Who is In Your Market

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Industry Trends and Outlook

Food manufacturing

Annual Indicators Units 2008 2009 2010 2011 2012

Revenues

Revenues - Public Companies Mil. $ 100,487 100,101 111,724 130,338 142,748

change year ago % 11.0 -0.4 11.6 16.7 9.5

Cement Production Mil. $ 9,925 8,645 9,099 10,188 11,172

change year ago % -16.1 -12.9 5.2 12.0 9.7

Crushed Stone Production Mil. $ 17,638 17,145 16,726 18,684 21,643

change year ago % 34.5 -2.8 -2.4 11.7 15.8

Sand & Gravel Production Mil. $ 8,072 7,965 8,101 8,570 9,162

change year ago % 8.9 -1.3 1.7 5.8 6.9

Chemicals Quarterly Indicators Units 2008 2009 2010 2011 2012

Revenues

Revenues - Public Companies Mil. $ 582,752 558,355 615,954 699,963 784,308

change year ago % 16.2 -4.2 10.3 13.6 12.0

Shipments - Basic Chemicals Mil. $ 725,427 730,576 760,822 807,459 847,880

change year ago % 9.2 0.7 4.1 6.1 5.0

Shipments - Agricultural Chemicals Mil. $ 43,158 47,861 50,677 53,716 56,821

change year ago % 31.4 10.9 5.9 6.0 5.8

Shipments - Paints & Adhesives Mil. $ 33,641 34,997 36,209 37,760 39,354

change year ago % -0.9 4.0 3.5 4.3 4.2

Knowing The Industry Drivers Can Keep You In Front of Growth Trends

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High-Level Industry Segmentation (continued)Top 20 industry segments by number of establishments (reference table to aid in calculating CONNSTEP’s market penetration)

Line of Business Primary SIC Establishments

Printing, Publishing, And Allied Industries 27 1819

Industrial And Commercial Machinery And Computer Equipment 35 1570

Miscellaneous Manufacturing Industries 39 1118

Fabricated Metal Products, Except Machinery And Transportation Equipment 34 1090

Lumber And Wood Products 24 754

Electronic And Other Electrical Equipment And Components, Except Computer 36 721

Measuring, Analyzing And Controlling Instruments 38 585

Chemicals And Allied Products 28 514

Food And Kindred ProductsInclude Criteria 20 406

Transportation Equipment 37 368

Apparel And Other Finished Products 23 346

Rubber And Miscellaneous Plastics Products 30 307

Stone, Clay, Glass, And Concrete Products 32 284

Paper And Allied Products 26 230

Furniture And Fixtures 25 217

Primary Metal Industries 33 215

Textile Mill Products 22 146

Leather And Leather Products 31 80

Petroleum Refining And Related Industries 29 47

Tobacco Products 21 7

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Compile Relevant Secondary Data Points for your Strategy

Aerospace and Defense - Annual Forecast Table Annual Indicators Units 2009 2010 2011 2012

Revenue

Sales Revenues Mil. $ 415,931 433,620 448,576 483,721

change year ago % 8.7 4.3 3.4 7.8

Major Diversified Companies Mil. $ 218,647 226,099 226,862 240,880

change year ago % 8 3.4 0.3 6.2

Aerospace & Defense Suppliers Mil. $ 197,284 207,521 221,714 242,840

change year ago % 9.6 5.2 6.8 9.5

Company Total Revenue

(US$) Domestic Revenue

(US$) Total

Employees

Boeing $64.3 Billion $38.1 Billion 160,500 AgustaWestland $50.5 Billion N/A 10,433 Lockheed Martin $45.8 Billion $38.4 Billion 132,000 Northrop Grumman $34.7 Billion N/A 117,000 General Dynamics $32.4 Billion $28.5 Billion 90,000 BAE Systems $32.6 Billion N/A 98,200 Bombardier Aerospace $17.6 Billion 1.0 Billion 65,370 Cessna Citation $10.5 Billion N/A 8,500 Sikorsky $6.318 Billion N/A 17,000 Eurocopter $6.4 Billion 784 Million 15,000 Piasecki $5.0 Million 5.0 Million 56 Bell Helicopter/Textron 4.2 Billion 599.2 Million 8,172

Top Regional Firms

New York, with a total of 30 aerospace players claims the largest share in the five-state area. Pennsylvania is second, with 13.

Government reduced their spending on defense…

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A Quick look at Competitive Benchmarking:

Please note: Competitor metadata descriptions include those of Hartz, D&D Commodities, Kaytee, Nunn-Better, and Red River Commodities

CompetitorsCompany X

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Hartz

Kaytee

Hagen

Red River Commodities

D&D Commodities

Higgins Premium Pet Foods

Vitakraft Sunseed

Wagner’s

Company X

Nunn-Better

Performance Seed

Website Grade

• The website www.fmbrown.com ranks 2,079,411 of the 4,054,028 websites that have been ranked so far.

• A website grade of 49/100 for www.fmbrown.com means that of the millions of websites that have previously been evaluated, an algorithm has calculated that the F.M. site scores higher than 49% of them in terms of its marketing effectiveness. • The algorithm uses a proprietary blend of over 50 different variables, including search engine data, website structure, approximate traffic, site performance, and others.

• F.M. Brown has 183 pages indexed or stored on search engines (to support web optimization) in comparison to rivals like Hagen with their 23,000 and Hartz with over 5,300.  Aside from the outliers in this category, the average index ranking was 231.5.

 

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Competitive Benchmarking - Market Research Tools

 

Word Cloud Tools:

www.tagxedo.com

Free Website Assessment Tools:.•Examples include SEO Scores (http://www.seoscores.com/), •Pear Analytics (http://www.pearanalytics.com/), and •Website Grader (http://websitegrader.com/)

Moving Forward:

Use these Assessment Tools On Your Site and Your Competitions.

       

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Connecting Research into Your Strategy

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If properly performed your efforts will answer the age old question:

How Are We Unique? And, your efforts will also inform you of how to use that to your advantage.

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Threats•Free services provided by IDCs and SBDCs

•Manufacturers’ business associations

•WIB

•Continued funding cuts

•Non-consumption of IMC services

•Expanding pool of direct competitors

Strengths•Established reputation as a resource broker; connected to a broad range of manufacturers in a concentrated region•Known for a focus on small businesses, yet capable of working with clients of various sizes•Known for its ability to successfully execute a range of challenging project types•Solution selling expertise•20-plus years of experience with the ability to service approx. half the region’s manufacturers•Ability to successfully identify and obtain grant funding•As many as 90% of projects delivered with third-party talent•Perceived “White Hat” positioning

Weaknesses•Limited ability to attract new clients to IMC•Database may not capture all large players•Projects tend to be grant-driven•Limited number of repeat clients•Lack of focus on cluster data•Internal struggle to clearly articulate Value Proposition•Lack of internal resources/content experts (i.e. business growth) •Historic lack of focus on project revenue and margins•Frequent inability to justify markup

Opportunities•Double market penetration •Establish presence among industries with high growth potential •Prioritizing market opportunities, targeting clusters•Develop a consistent message for business world•Develop a team behind a new IMC brand•Bundling services; highlight top-line growth capabilities•Create a new, dedicated strategic planning team

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Supplier (Third-Party Partner) Power – Low

- Growing number of third-party suppliers- Various sizes/structures of suppliers- Relative ease switching partners- Limited distinction across third-party groups

Substitutes – High -Low cost of switching -Non-consumption-High buyer flexibility/low perceived difference among consulting groups-High degree of service alternatives

Buyers – High -Low cost of switching-Very price sensitive -Low perceived difference among service providers -High degree of service alternatives

Competitive Landscape

Randomly Selected IMC Rivals:

1. RPA Inc. 2895 South Reach RoadWilliamsport, PA 17701http://www.rpainc.org/

2. ESA Marketing, Inc.416 Pine Street #201Williamsport, PA 17701-6228No website/employees 1-10Revenue – $96K

3. Kolb Net Works (Web-based marketing)334 East 4th StreetWilliamsport, PA 17701http://www.kolbnetworks.com

4. Manufacturer & Business Association(Headquarters in Erie, PA)2401 Reach Road, Suite 102Williamsport, PA 17701http://www.mbausa.org/

5. North Central Pennsylvania SCORE Williamsport, PA 17701http://www.lycoming.org/score/

R

Competitive Rivalry – High -High number of competitors-Limited differentiation -Risk margins for project volume -Varying levels of service sophistication-Varying levels of key account “connectivity” and service migration

Barriers to Entry – Low - Services are knowledge-based and require expertise, but most professional service companies strive to be more than one-trick- ponies, as such full-service consulting is an area that offers mass appeal. - Brand identity builds confidence; this limits the real-world growth potential for a one person shop, but the downsizing of many former execs has placed many new owner/operators out in the field.

- Minimal investments in technology and infrastructure are required; a website, shared office space, and little more are all most players need to be in business.   

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Your Market Research Should Deliver Key Market Insights

The innovative, niche players and those who are heavily financed take market share over those who live day-to-day

The Alpha Position is a result of giving the market what it wants faster and better than a rival supplier

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SYLVIA WOWER Thank you