Market Valuation

kikel

Hey All,

Writing a business plan at the moment. How does one go about putting a value on a certain market.

EG:
SEO services
Web Design. (and again our target client in this vast field. Website prices vary vastly)

How do I know if this market is increasing or decreasing. I've got opinions but they are just that.

Peterdalkey

From memory there are approximately 300,000 businesses, sole traders and self employed in Ireland, Not all need a website but many have multiple sites/FB pages etc. There are many old websites that are in need of modernisation. Market is not your problem, it is capturing a sufficient share as the competition is huge and the market probably oversupplied. You need a USP that will make you stand out and a marketing plan to get that message accross.

kikel

Hi Peter,

Thanks for your reply. Some great points.

We will be targeting the higher end websites as that is where my experience is. Companies that spend 5k+ on a website.

How does one go about finding how many companies have this type of spend.

USP I think we have got, not going to say anything about that if you dont mind.

Peterdalkey

I would have no idea who spends what. I am on the user side, so cannot help other than to offer the rather trite comment, that I would expect you to know who you were going to try to sell to before making a decision to get into the trade!! Harsh yes, but it is a business fundamental, lots of guys know how to do something, but only a few know how and where to sell it!!

pedroeibar1

kikel wrote: »

Hi Peter,

Thanks for your reply. Some great points.

We will be targeting the higher end websites as that is where my experience is. Companies that spend 5k+ on a website.

How does one go about finding how many companies have this type of spend.

USP I think we have got, not going to say anything about that if you dont mind.

Establishing market size never is easy. I think PeterD’s estimate of 300 k is a bit high, I’d guess that he is basing that on the number of VAT registrations, which also would include farmers, etc. For potential customers spending €5k+ on a site I’d look at the ‘Top 1000’ list, exclude the top quartile and concentrate on the rest, as the bigger guys probably do it in-house.

Market growth has to be based on sector knowledge, but it probably is growing as people have held off on that type of investment for quite a while.

Peterdalkey

Not based on VAT registration but on a blend of Revenue business tax registrations , .ie domain names, Facebook Irish non-personal pages etc. All of which of course is totally useless as the important number is the "available market number" and to a new start up.. cant see any company in the top 1000 taking a chance on a new start up in the web services buying space. The key will be a very well marketed USP and then you have a chance of being taken seriously.

Employee buyers always take the safe option, the old... nobody ever got fired for buying IBM still applies! If you cant identify your market and at some level have suitable contacts in it, you are probably doomed!

Voltex

One potential way of assessing the Market size is to identify the 1 or 2 most significant companies in this space right now. It should be straight forward enough to work out their current Market share.. E.g if company A claims to hold 15% Market share. Then if you get hold of their revenue figures you can then work out what the potential Market valuation is.