- Demand
- Addressable Market
- Realistic opportunity vs. competition
- Selection of “winnable” market opportunity
The demand for our business will be dependent on a couple factors that involve the amount consumers will be spending on clothing online as well as preferences by consumers as to how they shop for clothes in general. If we can gain a good understanding of the current demand for online clothes shopping and factor in changes as a result of new technology, impact from economic conditions, and the increasing competition online then we will have a better picture of what the actual demand will look like.
The next step is to identify the addressable market by doing research on the potential revenue opportunity. Our approach to identifying this market is by looking for press releases on trends within the clothing sales industry, reviewing industry websites and department of commerce data that could be applied to where people are spending money within the clothing market. Another approach we are taking is to perform a survey to get additional data points on demographic details and specific customer needs.
In general, U.S. online retail sales have increased close to 13 percent in recent years and the industry is expected to continue to grow. However, with this has come an influx of startups as well as growth of some of the major e-commerce sites such as Amazon and Ebay. While these sites maintain very loyal customers, there is still plenty of opportunity for niche sites. Especially given the fact that access online has significantly grown due to the user of tablets and smartphones in addition to the ease of use of internet searching capability. While some companies are focusing on specific lines of clothing (department sites), certain styles (vintage estores), or simple generic searching (Amazon) there is a realistic opportunity with our model in the area of style savvy consumers needing or wanting a specific look.
Realistically, the market that we’re targeting here given the opportunity is at the higher end of the consumer spectrum. In general, we are looking to take advantage of the convenience of TVtoWear for those of higher levels of education, income, and/or occupation who are willing to pay a little more for a certain style or look. These focus areas can be expanded by providing other cost-effective alternatives or by marketing to other demographic areas in the future. However, our research and analysis on market size has led us to a reasonable strategy for our business startup.
Tanya, you have a good summary of your target market and demand. I understand you still have some homework to do to identify the market size including addressable market size, which I believe is going to be the important one especially for your financial analysis. It is quite interesting about the 13% growth rate for online ratailer. I wonder how much it is is at the expense of the traditional brick and mortar stores.
ReplyDeleteTanya good summary of our "plan"...hopefully our online research and survey we have put out there will help us in getting some hard numbers for our business model. I can honestly say when I describe our business model to people in person they are pretty impressed....
ReplyDeleteTanya, I agree with you that the niche market for e-commerce has great opportunity for start-ups. Amazons and eBay as the retailer giants can’t fulfill all customers’ needs. It’s correct that Amazon succeed because of it going after long tails. However, the question is whether Amazon has a long tail or not. I believe the answer is yes. TVtoWear is the great example that going after a niche market is a great choice. And nice analysis on the market size, very detailed and clear.
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