Fads have a bad reputation for lasting for very short periods of time and fading away. But as always, there are companies that create profits from them. That is due to the fact that they work as moments of opportunity that are almost impossible to predict. On the other hand, trends are a lot slower to creep up and they last a lot longer.
But more importantly, fads have a predictable course. Most of the time, trends correlate with social or economic changes in a given segment of the market.
Lastly, we have megatrends. They are a lot slower to develop and they are the results of noticeable political, socio-economical, and technological shifts. Estimates show that most megatrends last for at least five years. But it’s not uncommon for megatrends to last a lot longer.
The market environment right now is showing that handheld devices are incredibly popular. Currently, consumers from most societies around the world are willing to pay premium prices for high-quality phones and other devices.
However, even if this has been the latest development, the market is not slowing down and will move on.
Companies that want to profit from trends can undertake trend-spotting themselves, or hire a market research agency. The important part is conducting thorough market research to predict and capitalise on trends.
Another current trend that doesn’t seem to be slowing down right now is in the realm of fitness. Fitness and dieting are becoming increasingly popular with audiences from all around the world.
But the way these trends and companies work together is under the influence of a variety of significant multiple factors. Some of those factors include globalisation and communication. These two factors are among the most powerful driving forces behind the changes in the market. Also, new players are entering the market each year and are influencing the overall game.
So, in order to fully understand what is market scanning, we need to look at these factors in greater detail and separate them into six different key categories:
1. Demographic Factors
It is the nature of societies to change. And changes in the volume of the population or their opinions are very important for the market. One of the most important demographic factors is the per capita income. After all, it denotes the purchasing power of the average person in a certain demographic. Other important factors are urban migration, diversity, the average age of the population, and the sizes of cities.
2. Economic Factors
We have mentioned the per capita income as a way to deduct the purchasing power. Purchasing power, as such, is an incredibly important economic factor. Also, companies would do well to monitor the levels of savings and interest rates in that segment. It goes without saying that people with higher income are more likely to buy premium items.
3. Ecological Factors
Not every country can boast having the same natural resources for every industry. Take for example the fossil fuel industry. The demand for fossil fuels is on the constant rise, and it is affecting the prices of fossil fuel. But more importantly, fossil fuels as such are starting to run low. So companies are trying to design products that require less fuel to circumvent the cost and the availability issues. Furthermore, most countries have laws that are there to protect the environment. That makes it a priority for most companies to find ways to be more eco-friendly.
4. Technological Factors
The development of the Internet has given companies and consumers an easy way to communicate among themselves and other organisations. And that connectivity is shaping the business world of today. But the effects of technological advances don’t stop there. Namely, scientific advances are bringing in new products, trends, and new manufacturing methods each year.
5. Political Factors
In order to successfully start a company, one has to have a thorough understanding of the regulations and laws of their own country. However, if they want to expand into foreign markets, they have to learn about those countries. Regulatory policies, competition limitations, and other laws can greatly affect the way a company operates within a country.
6. Cultural Factors
The cultural shift of most modern societies is moving towards several goals. For example, people are becoming increasingly eco-conscious. For that reason, most companies nowadays have to show that they are operating in line with the value systems of the receiving environment.