How to Research your Market
What makes a plan “strategic” is that it takes into consideration what is happening in the world outside your organization and responds to that context. Otherwise it would simply be a long-range plan. So what does it mean to research your market and how to do that? We break market research into several distinct pieces.
Benchmark Against Comparable Organizations
It is helpful to get a read on how you are situated relative to your comparable organizations (a/k/a “colleagues” or “competitors”). These are other organizations that are mission-similar and serve a similar clientele. This is sometimes referred to as benchmarking. To do this, we like to compare basic financials - overall revenues, total expenses, program expenses and earned revenue. This gives us a basic sense of relative sizes of each organization, and how they are faring in terms of covering their program costs with earned revenue (i.e. how much philanthropic subsidy is required to deliver their programs compared to their colleagues).
What is the program menu at each of the comparable organizations? It is helpful to understand the breadth and types of programs offered by the organization’s colleagues - both to see how the organization “stacks up” but also to identify potential partners. Who else is providing similar programs? Who might be providing programs for a longer time in the client’s life? Might there be opportunities to partner with them to extend the impact of your work?
Who is funding your comparable organizations? How does that compare to who is funding you? Does that give us ideas for who else you might approach?
Understand Market Forces
It is also helpful to get a read on the trends or developments in the world that may be affecting your clients or your organization. We can typically break these down into the following categories:
POLITICAL OR REGULATORY SHIFTS
Is your organization tied in some way to political or regulatory cycles - such as elections, appointments, budgets for different agencies. How will those be affected by an upcoming shift - an election or budget cycle?
What is the current state of technology - what is emerging and where is that going? Will that cause you to change some aspect of how you operate? How will it affect your clients? Are technological developments tied to finances such that your clients might get excluded from new developments?
What is happening sociologically that could affect your organization and should be factored into your plans. Are there movements or trends emerging or at play to which you need to respond? How are demographics changing and how will that affect you and your clients?
Predict future trends
Are there conversations or articles about future trends that will affect society as a whole? Some current trends are things like the future of work, the decline of the natural environment, the emergence of artificial intelligence, heightened need for data security. All of these could affect you or your clients significantly and you should understand them so you can position yourself accordingly.
When you understand your market, you are better positioned to be sustainable and resilient despite (or because of) what is happening in the world outside your organization. This is crucial to strategic planning.