What is a STEEP analysis?
A STEEP analysis is a way to help you identify and define relevant trends that will impact your business.
Why is it important?
It can help you discover gaps in the market that might give you a unique opportunity, and it can help you be prepared for changes in the marketplace.
So how do you put together a STEEP analysis?
Use information from your research (using articles, books, websites, your own observations, etc.), and select interesting trends related to your business idea or business area (e.g., Adnan would look at trends in the food industry).
As we’ve mentioned, STEEP stands for some of the types of trends you might see.
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It’s worth noting that you don’t need to identify trends for each one of these categories when you conduct a STEEP analysis, especially because not all categories will be relevant for your industry or may have taken place. This is just to give you an idea of the main areas where broader changes can create trends that may impact your business or create an opportunity gap for your business idea. Some trends might also be caused by changes in more than one STEEP areas (e.g., changes in politics and the environment might lead to more opportunities for “green” business ideas).
So, how do you assess trends?
Once you’ve identified a few trends in your business area, you should evaluate them, and figure out which ones are going to be important to you. Focus on trends that are highly likely to happen and that would have the most impact on your business. Then, analyze your findings.
An easy way to do this is to use a two-by-two framework or “map.” Watch the video below for more information.
There are lots of different things that might impact your business in multiple ways. The more you think about these before you start your business, the more you can avoid the potential traps or pitfalls in your trek. You might not be able to avoid everything, but you can definitely be smart about it!
Now you try it!
Let’s analyze some findings, based on the Grow-Well business case study that we first mentioned in Lesson 1. Imagine you’re Jennifer Growell, the owner of Grow-Well, a business that focuses on selling custom-made organic baby food and running healthy baby food cooking classes. You want to develop your business idea further, so you’ve done some research on trends that might impact your baby food business:
- Take a look at the five multiple choice options below. Each one is a different trend that impacts the food industry (some of these appear on the STEEP analysis map for prepared food that’s discussed in the video above – if you’ve skipped the video, go back and watch it before completing this quiz).
- Pick what you think the potential impact of these trends might be on the Grow-Well organic custom-made baby food business by clicking on the right answer(s).
- Be sure to select all answers that apply, as there could be more than one right answer. While you go through these, try to identify what STEEP changes you think might’ve caused these trends (e.g. social changes, environmental changes, etc.).
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- Question 1 of 5
Trend: Increase in organic and all-natural foods
- Question 2 of 5
Trend: Increasing number of mothers in the workforce
- Question 3 of 5
Political Change: Government regulation of food/labelling
- Question 4 of 5
Trend: Increased consumption of prepared foods
- Question 5 of 5
Trend: Economic downturn
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