Market trends refer to the direction taken by specified financial markets over a period of time. In general, businesses and buyers consider three types of trends. Primary trends affect most of the market and persist for a year or more. On the other hand, secondary trends last just weeks or months. Finally, secular trends can go on for years and even decades. While markets experiencing upward trending are known as bull markets, those with a downward trend are referred to as bear markets.
Whereas financial institutions use their knowledge of market trends to make purchasing decisions, business owners must evaluate these same trends to assess customer buying habits and make important choices about their companies’ futures.
Keeping an Eye on Market Trends
The best way for businesses to stay abreast of emerging market trends is to keep up with news and developments affecting their industry. One of the easiest ways to keep an eye on market trends is to use Google alerts. Set up alerts for your business’ name, the names of your competitors, your own name (if it is used in the course of normal business) as well as any relevant industry keywords and product names. When an article with those terms appears online, you will receive an email notification letting you know about it.
Another handy tool for tracking market trends is Twitter. Optimize your Twitter feed by following your competitors and industry thought leaders. Find the top brands in your market, and follow them and other influencers. You can also use Twitter’s “Who to Follow” feature, which offers recommendations for Twitter accounts you’d be interested in, or you can use a site like WeFollow or Twellow, which allow you to search for influencers by keywords, industry, location and other categories.
A more traditional method is to read the Wall Street Journal, which follows many industries. For access to technology-specific trends, you may want to join a blog-ranking service like Technorati. After business owners create profiles detailing their areas of interest, Technorati will rank relevant blogs based on their authority.
Web traffic statistics can also help businesses discover new and emerging trends in the market. Resources like SimilarWeb allow you to analyze competitor webpages and determine what other sites their users browsed before and after a visit. Once you know what products and services are of interest to your target audience, you can then tailor your own inventory and website accordingly.
Another effective way to spot new trends is to join one of your industry’s trade organizations. Along with offering great opportunities to network with potential partners and clients, industry trade groups release newsletters and publications to help keep you informed about the field. Trade organizations may also host shows and conferences that let you see upcoming products, keep an eye on competitor developments or even give you a chance to showcase your own business.
The Importance of Market Trends
While market research may seem tedious, identifying trends helps you assess the demand for your product and will indicate whether that demand is apt to grow or shrink in the coming months. If demand is likely to grow, you can adjust your sales and marketing strategies accordingly. On the other hand, if demand seems to be waning, you may want to begin pursuing other products and opportunities.
Additionally, following these trends helps businesses stay competitive in their marketplaces while keeping their clients satisfied. By offering new products and services before your competitors, you can stay one step ahead of the market. Trends can also help you understand the ways in which your customers shop. For example, are clients buying your products online or in a brick-and-mortar store? Does the state of the economy affect the rate at which they buy your goods? Will your target audience grow or shrink as the population ages? By following market trends, you can make informed decisions in regard to both the products you choose to sell and the marketing strategies you employ to reach potential customers.
Whether you’re starting a new business or trying to ensure your company stays competitive, understanding market trends should be an essential part of the way you run your company. By staying abreast of the latest news and developments in your industry, your business will be ready for any business climate, be it bull or bear.