Market Opportunity Assessment (MOA)
The
Initial Assignment
To start the
innovation project, students will learn how to tell the difference between a
good idea in a casual conversation and a great scalable business opportunity.
In this exercise, you will identify and define a market opportunity and present
the opportunity in a report. Each student will create a ‘market opportunity
assessment’ proposal in which you will analyse and describe your innovation
opportunity. Proposals will be posted on the class website and open to ‘review’
among our fellow innovation funding students. Venture capital will be allocated
among proposals reflecting market confidence in the innovation idea.
This project
is not intended to be a business plan for an innovation idea, but rather an
investigation of the feasibility of an idea and viability of commercializing
it. As such, your project should reflect an understanding of the core concepts
that you have been taught in this course. It should also reflect aconcerted
analysis on your part to investigate the idea proposed.
Key
Deliverables
You should
identify an innovative business venture (new business, product or service)
opportunity from the FastCompany innovation website and perform an initial
analysis to understand whether, why and how your opportunity can be turned into
a scalable business. In your written analysis, you should tell the
“story” of your proposed innovation by addressing as much of the
following as possible and appropriate to your specific innovation concept:
Concept
and Vision.
Where did
your idea come from (e.g., a new technology, another market)? Explain what the
market opportunity is and what your solution might be. What makes your solution
particularly compelling? How does it make meaning and the world a better place?
Do you have personal experiences with this market? Is there existing
intellectual property that you must license or new intellectual property you
must develop in order to pursue this opportunity? Has anyone tried something
like this before? If so, why did they fail or succeed, and why is the
opportunity still attractive?
Market
Analysis.
What
industry or sector of the economy are you addressing? Why is this market
attractive? What segment of the overall market are you pursuing? What market
research data can be gathered to describe this market need? What are the total
industry or category sales over the past three years? What is the anticipated
growth for this industry? If this is a new market, what is the best analogous
market data that illustrates the opportunity? Project the potential market size
and growth for your opportunity.
Customers
and Customer Development.
This is
extremely important. You need to have a clear idea of who your target customer
is. The only way for you to be able to do this is to “get out of the
building” and speak with your potential customers. You will need to answer
questions such as: What does the customer need? Why does the customer need it?
What is the customer using today? What is the customer willing to pay for your
solution? Why? How will you reach this customer? You should include both
primary (or first-hand) research and secondary research, emphasizing primary
over secondary.
Competition
and Positioning.
Who else
serves this customer need? Who might attempt to serve this market in the
future? What advantages and weaknesses do these competitors and would-be
competitors have? What share of the market do specific competitors serve? Are
the major competitors’ sales growing, declining, or steady? What are the
barriers to entry for you? What are the barriers to entry for additional
competitors? How could partners and allies best help you overcome competition
from established enterprises or other start-ups?
Business
Model and Go-to-Market Philosophy.
Now that you
have discovered an opportunity and talked to potential customers, how will you
turn it into a viability business opportunity? How will you make money and when
do you expect your innovation to be profitable? What is the major risk to
address right away (e.g., market or technical)? In other words, which
hypothesis regarding product or market strategies needs to be tested right
away?
The list
above has no implied order. Some innovation champions start with a well-defined
concept and then try to identify a market for their idea; others start by
studying a market and then stumble upon an idea. Also, please keep in mind that
the specific data and information you provide will vary according to the type
of opportunity you choose to analyse and the nature of organization sponsoring
it.
I
recommend five basic steps in the process of analysing an opportunity:
Identify
potential opportunities.
Combine your
own personal experiences and creativity with external forecasts and trend
analysis. How is the world changing with respect to new technologies? What is
the impact of globalization on current solutions? What new requirements will
those changes produce? Recent media articles and blogs on trends are often a
good place to start.
Define
your purpose and objectives.
Identify
your most promising opportunity, being careful to discriminate between an
interesting technological idea and a viable market opportunity. Prepare an
outline which will help you to determine what types of data and information you
need to demonstrate the attractiveness of your chosen opportunity.
Gather
data from primary sources.
It is
crucial for you to obtain data from primary sources. Potential champions will
place more trust in well conducted primary research than in stacks of data
fromsecondary sources. There is simply no substitute for talking to potential
customers from the target market in order to validate the opportunity you have
identified. Consequently, we prefer that you spend time gathering data from
primary, not just secondary, sources.
Gather
data from secondary sources.
Countless
secondary sources exist on the web and in the HCT’svarious library resources.
Try not to get too bogged down in financial and accounting data.
Analyse
and interpret the results.
Persuasively
summarize your results.
A key
success factor for a successful project is the depth of your analysis and what
you learned from it. If after careful research you have determined that your
business idea is not as promising as you originally thought, it is totally
acceptable to present a MOA that describes why your idea may make sense now in
the short term but not necessarily be the next big thing. An honest, rigorous
analysis of an idea that does not survive further
scrutiny is preferable to either (a) a half-baked presentation of an idea you
are unsure of, or (b) an enthusiastic job of over selling for your current
idea, even though you know it is problematic.
Proposal
submissions should be ‘clear and concise’ … ‘purposeful and persuasive’. Be
sure to sell the story with conviction.
