The most successful businesses are those which find an unfulfilled need, a gap in the market, something that consumers want but that doesn’t exist yet. Or perhaps it does exist, but it can be done better. It’s against these basic principles that any new business idea needs to be tested.
The question is, how to find a gap in an existing market? Or, even more challenging, how to find an entirely new market or, as in the case of, for example, Uber, to disrupt an existing market so profoundly as to change it beyond all recognition.
While there’s no shortcut to finding the world-beating idea or the unfilled market gap, there are some things you can do to maximise your chances.
1. Start with your own strengths
It doesn’t do you any good to find a market gap that you can’t exploit. So, before you start identifying gaps in existing markets, take some time to identify your strengths.
Your strength, in this case, is something that you’re competent at and have the required knowledge and skills for. Once you identify your strengths and talents, make a list of possible problems that could benefit from your expertise and begin to think about what solutions there might be to these problems.
2. Stay on top of market trends
To identify what’s missing in an existing market, you need to have your finger on the pulse of current trends. Changes in customer behaviour reveal new opportunities for you to exploit so keep an ear to the ground to find out what customers are currently saying. Read the forums and consumer feedback and take note of any recurring complaints, perhaps these represent a problem that you could solve, or a way that you could improve existing processes.
You can use social media to get honest feedback about what customers want. Subscribing to industry association newsletters and magazines and speaking to key industry influencers can also help you stay on top of trends.
3. Elicit feedback from customers
Customer feedback is an invaluable tool when identifying gaps in an existing market, so ensure that you routinely get feedback from your current and prospective customers. To do this, you can conduct surveys, create social media polls, participate in forums, engage customers on live chat, analyse on-site activities, etc.
By gathering this feedback on a regular basis you can ensure that any problems are dealt with early on and that your business continues to solve the problems you set out to solve.
4. Copy and improve
Copying another business doesn’t sound like the best advice, but before you dismiss the idea, hear us out.
Creating a new product is risky, and companies are simply iterations of the same idea, but either done better or setting out to serve different market segments. For every up-market product for example, there will be mid-market and economy products too, making sure that all budgets are catered for.
So, if you’re looking to iterate on an existing idea;
• Research what other companies are doing and find a way to offer extra value, greater efficiency or reach new audiences
• Customise an existing product to fit your target market better
• Take a look at any forthcoming regulatory impacts on the market, and design a product which is compliant or gets ahead of those changes.
Changes in legislation can force an entire industry to make changes, creating market gaps. If you can successfully forecast these changes, you will be able to identify new opportunities early enough to take advantage of them.
To keep up with proposed legislation, sign up for industry news and updates. You can also create Google Alerts for industry-related keywords, so you get emails every time they appear in the news.
No market is static, and all businesses are subject to constant pressure to innovate because, if they don’t, someone else will. Becoming that someone else takes hard-work but a little strategy goes a long way.
By focusing on one market and how it could be improved, it is possible to find better ways of doing things and underserved market segments. Paying close attention to customers and competitors can reveal opportunities to innovate.