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The importance of Market Data Coverage 

Understanding your market is crucial for success in today’s competitive business landscape. Accurately assessing the size of your potential market, identifying customer needs and desires, and monitoring competitor activities are crucial elements in developing a winning customer strategy. Failing to do so can lead to missed opportunities and potential downfall, as exemplified by the story of Blockbuster, a once-dominant player in the US video rental industry.

This blog post highlights the significance of market data coverage and the risks associated with misjudging market size. We will explore how companies can utilise local market knowledge and expertise to validate their vision and projections. Additionally, we’ll examine the case of X5 Group, a prominent supermarket chain, to illustrate the importance of staying informed about market dynamics.

Avoiding business blunders

For businesses, it is essential to appreciate the importance of your market data coverage. Not correctly mapping out how large, or indeed how small, your potential market is, is a recipe for a marketing and sales blunder. Other characteristics, such as the homogeneity or heterogeneity of your prospect group and their primary needs and desires, are crucial in setting up a successful customer strategy. You also want to map which competitors are active in the same target group and how the various market shares relate.

Take market developments very seriously; a billion-dollar blunder example

Companies that misjudge the market size run the risk of limiting their potential and excluding themselves from opportunities. An example is Blockbuster, a dominant US video rental industry player in the 90s with a billion-dollar turnover. They thought the internet would not pose a threat and that people would always continue to visit their physical stores. They underestimated the market changes and ultimately missed the boat when Netflix took over the market.

A more recent example; X5 Group

Utilizing local market knowledge and expertise is generally a good way to test your vision and projections about market potential against a more objective standard. For example, X5 Group (formerly X5 Retail) is on almost every prospect list of international companies entering the Dutch market. This supermarket chain, which also has a rapidly growing online branch, is now in the global top 50 food retailers with a turnover of 27 billion in 2020. The holding company has their home base at Zuidplein in Amsterdam. However, I have not found an X5 store in the Netherlands because they are all in Russia.

An indispensable piece to your marketing strategy

In short, without local market insights, relevant prospects can be overlooked entirely or, more annoyingly, in the example of X5, candidates can be suggested that do not currently have the potential to contribute to achieving your targets. Therefore, it is vital to have a current overview of the market size and to update this regularly. By better understanding who your potential customers are or are not, you can more effectively align your marketing and sales strategies to the market’s needs and continue to be successful in the industry. Market coverage data is an indispensable piece of the puzzle in this respect.

Erik van Gurp, Business Analyst 

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