How to Write a Market Analysis (Framework and Template)

To craft a winning strategy, you must first understand your market. Where is the growth? How is value distributed across the value chain? Where are your competitors strong or exposed? Without this understanding, strategy becomes guesswork rather than a calculated path to advantage.
 

A robust market analysis turns data and research into actionable insights, enabling companies to anticipate trends, identify opportunities, and avoid potential blind spots.
 

Drawing on best practices from top consulting firms like McKinsey, BCG, and Bain, this post will guide you through a structured framework for creating a market analysis and provide a practical, step-by-step approach to executing it. The goal is to equip you with a simple playbook to analyze your market and form winning strategies for your business.
 

Why do a Market Analysis?

Most businesses have nearly unlimited options when deciding what to focus on. Should we enter this market, go after this customer segment, lower the price, or develop a new digital product? Market analysis is essential for answering these questions by turning market data and research into insights. Be it your strategy team, product development team, or even CEO, the insights offered by market analysis are fundamental to data-driven decision-making.

 

Market Analysis Framework 

To ensure a comprehensive analysis, management consultants often use a structured Market Analysis Framework with seven core building blocks:

1. Market Definition: Clearly define what market you are analyzing – its scope and limits. This sets the stage for all subsequent analysis.
    
2. Market Size: Quantify how big the market is and could be. Calculate the Total Addressable Market (TAM), Serviceable Available Market (SAM), and Serviceable Obtainable Market (SOM) to size the opportunity.
    
3. Customer Segmentation: Break down the market into key segments and identify their distinct needs or preferences. Understand which segments matter most and why.
    
4. Competitive Landscape: Map out the competition and where value is captured. Who are the key players, and how is profit distributed across the value chain?
    
5. Customer Decision Journey: Understand the buying process and customer journey in this market. How do customers become aware, evaluate, and decide – and what drives loyalty?
    
6. Growth Drivers, Trends & Risks: Identify the major trends driving market growth or decline, and the external risks that could impact the market's future.
    
7. Strategic Implications: Synthesize the findings into strategic insights. What are the "so what" implications for your business?

This seven-block framework ensures that a market analysis is MECE (mutually exclusive, collectively exhaustive) – covering everything from definitions and data to insights and action. 

Step-by-Step Guide: How to Fill Out the Market Analysis Framework

Now, let’s dive into each of the seven components of the Market Analysis Framework. For each block, we’ll discuss what inputs you need, which consulting frameworks or tools can help, key questions to answer, and indicators of a good analysis.

1. Market Definition

What it is

The foundation of your analysis, precisely describing the market you are studying and setting its boundaries. This involves defining the scope in terms of product or service, customer segments, and geography. For example, is the market “electric passenger vehicles in North America” or “global automotive market including electric and ICE vehicles”? The definition must be crystal clear.
 

How to do it

Start by articulating the market in one sentence: “The market we analyze is […].” Be as specific as possible on:

• Offerings: What products or services are included (and excluded)? If you say “beverage market,” does that include alcoholic drinks or just non-alcoholic? Does it include bottled water, etc.?
• Customers: Which customer segments or end-users are in focus? (Consumer vs. enterprise, age groups, industries, etc., if relevant)
• Geography: What geographic region or scope? (Global, regional, specific countries, or urban vs rural if that matters)
• Value-chain stage (if applicable): Are you analyzing the entire industry value chain or a part of it? For instance, in some cases, you might focus on the retail segment of a market versus the wholesale or manufacturing level.

Consultants often iterate on the market definition early on. A useful tip is to consider boundary cases: if you change the definition slightly, would the analysis still be relevant to your objective? This helps ensure you’re not defining the market too broadly (diluting relevance) or too narrowly (missing important adjacent spaces).

Tools & Frameworks

There isn’t a fancy tool or framework for this - it’s more about disciplined thinking. However, reviewing how industry research reports or competitors define the market can be very helpful. 

Key questions to answer

• What exactly is the market we are studying? (One clear sentence)
• What is included in this market? What is explicitly excluded?
• Why does this definition make sense for our objective? (E.g., it focuses on the segment where our client operates or plans to enter)
• Are there adjacent markets or substitute products that we should consider, even if they’re not in scope? (This can hint at future expansion or competitive threats).
   

Signs of success

You know you’ve nailed this step when everyone involved (your team, stakeholders) has a shared understanding of the market’s definition. In consulting, an explicit “Market Definition” slide often appears upfront to avoid any ambiguity.

 

2. Market Sizing
 

What it is

Quantifying the market opportunity – your TAM (Total Addressable Market), SAM (Serviceable Available Market), and SOM (Serviceable Obtainable Market).

How to do it

There are two primary approaches: Top-Down and Bottom-Up. Consultants often use both and triangulate. 
See an in-depth guide to market sizing here: How to Create Market Sizing Slides: TAM, SAM & SOM  

Key questions to answer

• How large is the total market (TAM) today, in value or volume? And what is its projected growth?
• Of that, what portion can we actually serve (SAM) given our definition and focus?
• What share of that can we realistically capture (SOM) and in what timeframe?
• What assumptions underlie these estimates (e.g., number of customers, penetration rates, pricing)? Are they reasonable and backed by evidence?
• (If applicable) How fragmented or concentrated is the market? Sometimes understanding if the TAM is split among many players or dominated by a few helps contextualize your SOM target.
   

Signs of success

Your market sizing will be credible and decision-useful if it passes both the gut test and the scrutiny test. The gut test means the figures seem plausible (e.g., no one is shocked thinking "that number feels way off"). The scrutiny test means you can defend each figure: you have transparent calculations or reputable sources behind them. 

3. Customer Segmentation

What it is

This step is about breaking down the market into coherent segments and analyzing each segment's characteristics, needs and potential.
 

How to do it

First, choose a sensible basis for segmentation. Common ways to segment include:

• Demographic or Firmographic: e.g., by age, income, industry, company size.
• Behavioral: e.g., high-frequency users vs. occasional users; loyalists vs. switchers.
• Needs-based or Psychographic: e.g., customers focused on low price vs. those seeking quality; different use cases or jobs-to-be-done.
   

McKinsey often favors needs-based segmentation, as it directly ties to what drives purchasing decisions. For instance, in a B2B software market, segments might be "automation-focused adopters" vs "compliance-driven buyers" which speaks to their primary need/motivation. In consumer markets, you might identify segments by lifestyle or attitude (e.g., "tech-savvy early adopters" vs "value-conscious shoppers"). The key is that each segment is actionable, meaning you can take a specific action (such as tailoring marketing or product features) to serve that group better.


Once segments are defined, profile each one:

• Size & Importance: How big is the segment (in population or revenue)? Is it growing? Which segments contribute most to current market value vs. future growth?
• Customer Profile: Who are they? Develop a persona or description. What are their typical demographics or firmographics?
• Needs & Preferences: What does this segment value most? Is it price, convenience, quality, brand status, innovation, etc.? What pain points do they have that are not being fully met?
• Buying Behavior: How do they typically find information and make purchase decisions? (This links to the customer journey block later.) Do they buy through specific channels? How loyal are they?
• Current Satisfaction & Gaps: Are they well-served by existing offerings, or is there dissatisfaction? 

Tools & Frameworks

You might use the STP model (Segmentation-Targeting-Positioning) to structure the thought process: segment the market, identify which segments to target, and consider how to position for them.

If data permits, cluster analysis or surveys can provide evidence for distinct segments (consultants love to include a chart of survey results showing, say, 3 clusters of customers with different priorities). Creating personas (fictional but research-grounded representations of segment archetypes) can also be useful for communicating who the segments are. Another tool is a simple table, with segments as rows and columns for the attributes above (needs, size, etc.), allowing for side-by-side comparison.
 

Key questions to answer

• What are the main customer segments in this market, and how do we define them?
• How large and fast-growing is each segment? (Prioritize which segments matter.)
• What does each segment need or value? What problems are they trying to solve?
• How are customers in this segment currently served – are they satisfied, or is there unmet demand?
• Which segment(s) should we focus on, and why? (This crosses into strategy – e.g., you might conclude that Segment A is high value and aligned with our strengths, so it's the priority.)
   

Signs of success

A strong segmentation will illuminate strategic choices. You know you've done it well if stakeholders start saying things like, "Wow, Segment X is where the profit is, but we've been too focused on Segment Y," or "We need a different approach to win Segment Z based on these insights." In other words, the segmentation leads to an "aha!" about where to play or how to tailor offerings. Also, each segment profile should feel like a real, distinct group – if the differences between segments are fuzzy or trivial, you may need to refine your definitions. 

4. Competitive Landscape

What it is

A competitive-landscape analysis is a structured evaluation of direct, indirect, and emerging rivals that reveals their strategies, strengths, weaknesses, and market positions. Adding a profit-pool lens shows where economic value is really captured along the value chain, not just who holds revenue share.

How to do it

See this post for a full guide on how to do a competitive analysis: How to do a Competitive Analysis (6-Step Framework and Template)

Key questions to answer

• Who are the tier-1, tier-2, and emerging competitors, and how big is their share?
• How are rivals positioned on price, value proposition, and target segment?
• Where are their strategic vulnerabilities or gaps in customer coverage?
• Where is most of the profit made along the value chain—and why? 
• How do we compare on the dimensions that matter most to customers?

Signs of success

The competitive analysis should yield strategic insight, not just descriptive data. A good analysis should give you a clear point of view on how to win. For instance, you might conclude "the market is saturated with low-price players, but no one is addressing the high-end segment," or "Competitor A is dominant in distribution channel X, so we should focus on channel Y," or "the profit pool is shifting toward aftermarket services – an area we should invest in." 

5. Customer Decision Journey

What it is

This step examines how customers move from awareness to purchase and beyond. It's essentially mapping the buying process or funnel for your market, often now conceived as a non-linear journey. Understanding the customer decision journey helps pinpoint where you can influence the customer and how your marketing/sales process should align.
 

How to do it

Lay out the typical stages a customer goes through in this market. Many consultants prefer to use a structured journey model, such as McKinsey's Consumer Decision Journey, which is circular rather than linear. 

Map out each phase:

• Trigger/Awareness: What prompts a customer to even consider this product or service?
• Consideration/Research: How do customers research or learn about options? Do they read online reviews, consult salespeople, try free demos, ask friends? In B2B markets, this might involve RFPs or analyst reports; in consumer, it could be Googling or visiting stores. Identify the key information sources and touchpoints.
• Evaluation/Comparison: How do they compare alternatives, and what criteria matter? Price, features, brand reputation, convenience, etc.? Understanding the priority criteria at this stage is crucial - it tells you what drives the decision.
• Purchase/Decision: Where and how do they buy? Is it mostly online, through distributors, in a retail store? Any financing or purchase hurdles? For instance, if it's a subscription service, the decision might involve a free trial conversion.
• Postpurchase Experience: What happens after the sale? Does the customer need onboarding or support? Does usage live up to expectations? Are there opportunities for repeat purchase or cross-sell? And critically, does the customer become loyal or advocate to others? In many markets, loyalty loops are important – a happy customer might skip the earlier stages next time and go straight to your brand, or even recommend it. Conversely, a bad experience can knock a brand out of the consideration set next time.

When describing the journey, highlight pain points or drop-off points. For example, maybe many customers get stuck in the research phase due to too much information, or abandon carts at purchase due to price.
 

Tools & Frameworks

A customer journey map is the go-to tool. This is a visual flow of stages (often shown as a loop or linear timeline), with annotations of customer thoughts, questions, and feelings at each stage. You might also overlay touchpoints (e.g., "sees social media ad" at awareness, "compares specs on website" at evaluation, etc.). For a quantitative take, funnel metrics can be illustrated (e.g., 1000 people become aware, 200 enter evaluation, 50 purchase – a conversion funnel). Another useful framework is identifying Moments of Truth – the critical touchpoints that disproportionately influence the decision.

Key questions to answer

• How do customers become aware of and interested in products in this market? (What marketing or triggers work?)
• What steps do they take to evaluate options? (Where do they research, and what info do they seek?)
• What factors most influence their final decision? (price, quality, reviews, convenience, etc.)
• What does the post-purchase phase look like?
• Are there points in the journey where many potential customers drop out or get frustrated?
• How long is the sales cycle or decision cycle typically?
   

Signs of success

If you can tell the story of a representative customer journey clearly and identify leverage points, you've succeeded. Stakeholders should be able to empathize with the customer's experience after reading this.
 

6. Growth Drivers, Trends & Risks

What it is

This step zooms back out to the macro-level to identify what forces are driving growth or decline in the market. Essentially, it's about understanding the future trajectory of the market and the external factors that influence it - the "big picture" trends and uncertainties.

How to do it

Begin by listing the major trends affecting your industry (many of these might have emerged in Step 1., the Industry Analysis, but here we focus on the forward-looking impact). Common categories of growth drivers include:

• Technological trends: e.g., automation, AI, blockchain, new materials.
• Consumer/Social trends: e.g., demographic shifts (aging population, Gen Z preferences), lifestyle changes, increasing focus on sustainability or health. 
• Economic forces: e.g., rising incomes in emerging markets enabling new demand, or conversely, a recession risk reducing spending.
• Regulatory/policy: e.g., new regulations can either spur or stifle a market.
• Competitive/market structure trends: e.g., consolidation (M&A) in the industry, new entrants from adjacent industries (tech giants entering healthcare)

For each identified driver or trend, articulate how it impacts the market's growth or shape. Is it increasing total demand, shifting demand between segments, changing the cost structure, raising barriers, etc.?

Notably, a good analysis will not just list trends but prioritize the most impactful ones. If everything is a priority, nothing is. Highlight the top 3-5 drivers shaping the market's next 5+ years, and the top handful of risks that could change the outlook. Also, quantify where possible: "X trend is leading to Y% growth per year in this segment" or "If regulation Z happens, costs could increase by $N and slow adoption."

Tools & Frameworks

A trend impact analysis chart is often used to summarize findings: a 2x2 matrix of impact (high/low) vs certainty (high/low) to sort which trends to focus on.

Key questions to answer

• What are the key drivers of growth in this market now and in the foreseeable future?
• What emerging trends could reshape the market landscape? (Any early signals of change that could become big.)
• What are the major risks or uncertainties that could affect market growth or stability?

Signs of success

This part of the analysis should prepare readers for the future. A strong trends and risks analysis might lead a company to make proactive moves, such as investing in a particular technology because the trend is inevitable, or hedging against a risk (like diversifying supply chains if a risk is identified there).
 

7. Strategic Implications 

What it is

The final step is the culmination of the analysis, translating all the findings into strategic insights and recommendations. It addresses the "So what?" and identifies how the company should act on this analysis. This section is where a market analysis report becomes truly actionable, bridging into the territory of strategy consulting.
 

How to do it

Start by synthesizing the insights from all prior sections into a few key implications or recommendations. Essentially, answer: Given this market analysis, what should we do or not do? Some implications might be immediate strategic moves, others could be watch-outs for the future.

When forming implications, link them back to findings. For instance, "Because we found [this insight], we should consider [this action]." This traceability strengthens the logic.
 

Key questions to answer

• Given all the analysis, what are the top strategic priorities or moves we suggest?
• What should the company start doing, stop doing, or continue doing in this market?
• How can the company differentiate and succeed based on the market's characteristics (customers, competitors, trends)?

Signs of success

If this final block is done well, the market analysis evolves from a report into a strategic plan, or at least the cornerstone of one. The true test is whether the CEO or decision-maker reads this section and knows exactly what to do next.

 

Market Analysis Templates

Conducting a thorough market analysis is half the battle; the other half is presenting it in a clear and compelling way so that stakeholders can act on it. Top-tier consultants rely on well-structured slide decks and templates to communicate findings. If you're looking to create a consultant-grade market analysis report, using robust templates and tools can significantly streamline the process.

Slideworks currently offers two different Market Analysis Templates - both created by ex-McKinsey, Bain & BCG consultants:
 

1. Competitive Market Analysis Template

A comprehensive template containing 312 PowerPoint slides based on proven consulting frameworks, complete with storyline and best-practice slide layouts. The template contains five different sanitized, real-life cases showing different ways of conducting a market analysis with different purposes and different types of analysis and data input.

This template is ideal for:

• Identifying market opportunities and threats
• Supporting business planning and strategy
• Identifying key competitors and competitive dynamics
• Informing product development and innovation
• Understanding customer needs and preferences
   

2. Market Entry Analysis Template (multi-market)

A comprehensive template containing 458 PowerPoint slides based on proven consulting methodologies. This template includes four sanitized case studies showing what real-life market entry analysis reports can look like.

This template is ideal for:

• Multi-market comparison: Comparing different markets or regions on similar parameters to be able to judge which markets are attractive to enter
• Market prioritization: Prioritizing which existing markets warrant the most attention and investment based on their potential return.
• Competitive Intelligence: Analyzing competitors' operations in different markets to reveal their strengths, weaknesses, and expansion plans, and understanding competitive positioning
   

Further reading

If you'd like to dig deeper into the specific techniques mentioned in this article, these Slideworks guides are the perfect next step:

• Competitive analysis - a step-by-step framework, example slides, and a ready-made template
• Market sizing slides - TAM / SAM / SOM explained with visual slide examples you can reuse
• Getting to the "so what" – a consultant's playbook for turning research into crisp, actionable insights
• Writing recommendation slides – how to structure, headline, and design slides that drive decisions