Critical Thinking About Market Forces

Market ForcesWhen completing a Business Model Canvas, it is helpful to guide the discussion through the use of questions. When it comes to looking at market forces that will affect your business model, the following set of questions should help you in thinking more critically about your business model. These questions are broken down into five categories: market issues, market segments, needs and demands, switching costs, and revenue attractiveness.

Market Issues:

  • What are the critical issues affecting the customer landscape?
  • What market shifts are underway?
  • Where is the market heading?

Market Segments:

  • Can you define the customer segment further by demographic and psychographic characteristics?
  • Are there specific customer market segments that are growing or shrinking?
  • Are there peripheral customer market segments that deserve more attention?

Needs & Demands:

  • What are the customer’s biggest expressed/unexpressed needs?
  • What are the biggest unsatisfied customer needs?
  • Where is demand increasing/decreasing?

Switching Costs:

  • What binds the customer to a company and its offerings?
  • What switching costs prevent customers from defecting to competitors?
  • Is it easy for customers to find and purchase similar offers?
  • How recognized and important is your brand?

Revenue Attractiveness:

  • What are customers willing to pay for?
  • Where can the largest margins be achieved?
  • Can customers find and purchase cheaper products/services?

What market forces affect your business model?

1 reply
  1. Kim Trebold says:

    Steve, thanks so much for this great post. I wish I had this list of critical questions before launching my last venture, particularly in the area of revenue attractiveness.

    Reply

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