Business nowadays is all about trends and analyzing trends. Before we discuss its importance, what is trend analysis? Why do you need it for your business?
Trend analysis is comparing and analyzing different business data to find consistent and progressive results or trends. Through this, you can create a strategy in accordance with these trends and align them with the target and goals of your business.
However, trends do not remain the same throughout the year; you need to keep looking out for changes to make sure your business would not fall behind the others. Knowing what kind of trends are available can be beneficial for your company, so read on to find out more about it.
- Cyclical Trends
Just like the seasons, cyclical trends are repeating patterns throughout the years, similar to seasonal crops in agriculture. If you are able to identify the various cycles that are relevant for your business, timing is important for everything. As cyclical trends are generally the most reliable and predictable, your business schedule—purchasing, promoting, and your personnel—should reflect the cyclical trends. This is in relation to how people usually behave when the environment or situation occurs around them; an example would be the sales of thick jackets obviously dropping during summer and rising during winter. These are common and well known in the industry, so it would be sufficient to research and consult about them.
- Unidirectional Trend
There are trends that go in only one direction but might not always be applicable depending on what kind of business you have. This includes trends such as the world population, a factor that is estimated to grow over time and, thus, during the duration of your business. Although not all businesses have this similar reliability of the trend forecast, there are some areas that can be foreseeable.
- Reversing Trend
Also known as the reversal trend, there is a change in the price of an asset. This typically refers to large price changes, where trend suddenly changes direction. It happens rather quickly, and may happen over days, weeks, or years. Price action is important as an indicator, and when the price is over a rising moving average then the trend is going up, but when the price drops below moving average, it could be a sign a potential price reversal.
This can be tricky as a reversing trend can have one and only one peak, and it is not easy to say when and how hard the trend will suddenly change. You have to be keen, insightful, and knowledgeable enough to pinpoint such numbers or even second-rate approximation.
If you have enough information, you could be able to know more about the reversing trends and avoid losses.
- Review and Response
Improving your brand through the help of trend analysis can be done by evaluating the areas and aspects of the business that is doing great. Use it to your advantage and maintain a positive impression if it’s a certain product or service that people are showing interest in. This could be your main source of sales and reason for customers to keep coming.
You should also assess what part of your business seems to be lacking or underperforming. Finding your weakness is crucial for you to know what and how to improve. As an entrepreneur, it is necessary to address these kinds of matters immediately to avoid losses and further problems.
The data that you can collect through trend analysis are all supporting evidence that will ultimately guide you through decision-making. If there are things that you need to change in your marketing or manufacturing strategy, you can do it with the help of the information in your hands. Through strategic planning, you can proceed with the right actions for your company to progress and accomplish your business objectives.
BuenoSchonig Consulting is available to guide you on identifying and making a strategy to improve your brand. Send us a message and we can help you out!