How to spark demand when creating a new market space

By boris, March 10, 2015

When it comes to market opportunities, you can either build a better product in an existing market, or create a brand new market altogether.

In the first case where the product category and market are mostly defined, the playbook is relatively straightforward. Potential customers already know they have a need and are actively looking for a solution. The challenge is to build a better solution, have more effective marketing, and beat out any rivals in the space.

Creating a new market requires a different kind of strategy. On the upside, there’s a big underserved market right at your feet, but it’s undeveloped territory. People do not even know that they need a solution/product. In addition, marketing is a challenge since there’s no common terminology yet – meaning little search traffic and Word of Mouth.

An example for a big new market on the enterprise side is mobile software for non-desk workers as there are nearly 2.5 billion workers worldwide who are currently underserved by technology in their job. We made a few investments in this space over the past couple of years (e.g. Jobber and Frontdesk) and continue to be excited about the opportunity.

So how can your startup create market demand when customers aren’t yet looking to fill a specific need? There are usually three steps:

1. Brand it

You need to coin a catchy term for your market/value proposition that resonates with your target audience. You need to make it as easy as possible for customers to start talking about the market.

2. Educate

Use white papers, case studies, conference appearances, and thought leadership to communicate the challenges and opportunities in your space.

3. Create demand

Since target customers won’t necessarily be searching for a solution, you will need to leverage outbound sales efforts to create demand. Some enterprise companies, particularly in the SMB space, have nailed this discipline.

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  • Peter Kemball

    Boris
    Nice formulation. Should be asked at each major inflection point of the development of the business concept and then budgeted into the ask.
    Thanks

  • Great post – and you are right, there is a yawning gap between how you market a product in an existing space versus one in an emerging space. In my mind, the differences revolve around 2 things: what you are talking about and where you do that talking.
    In an existing space people are already looking for solutions so your content will focus on how you are different/better than other offerings in the space. In a new space, the content needs to focus on defining the problem, and the cost of not solving that problem. They will only care about your solution once they understand that they should.

    In an existing market you can “pull” people to your site because they are already actively in a research/buying process. For a new market you have find out where your prospects gather and how they learn and connect with them there (and yes, outbound sales is a piece of that).
    A good startup marketer will know that there are different tactics to use at different stages of a buying process. They should also know that the starting point of the process is different depending on the maturity of the market.

  • bwertz

    I like the “pull” (existing markets) versus “push” (new markets) analogy

  • kevin brophy

    Hi April: awesome comments. I’d like to talk with you and learn more about your work. Can you give me a call at 610.551.7688 or shoot me an email at kevin@vuid.co? Thank you, Kevin Brophy (www.linkedin.com/in/brophy to see I’m legit)

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