The maturity of the industry into which early-stage technology entrepreneurs seek to enter is one of the most important decisions. Because both product and marketing strategies must evolve as a market matures, this decision is essential. In this context, maturity refers to the presence of direct competitors in the market.
Market Maturity: New or Existing?
A truly creative product will solve a client problem that has never been solved before, usually because the technology to do so did not exist or was insufficient for widespread acceptance.
When launching a new product, the market is also new, and as a result:
There is no such thing as a product category (on the supply side).
The demand side (potential clients) are unaware that their issues can be resolved.
How do you measure market maturity? Customers are not always ready to buy in a new market. A technological startup must be ready to build a market by doing the following:
Ensure the acceptance of new technology
Educating customers about the potential market.
Both processes are time-consuming.
A product that enters an existing market presents a distinctive blend of challenges, including those posed by competitors who are already in the market.
- Customers are already on board.
Are well-known in the industry
Product and marketing strategies in an existing market differ from those in a new market. The product category exists, which also implies that the media is aware of it.
Challenges in an Existing Market
The existence of competition means that some potential clients are already aware of and maybe use your competitors' products.
As a newcomer to such a market, you have two options for measuring market maturity:
Take advantage of your competitors' customers.
Look for untapped market segments to pursue.
Assessing your market's maturity is a difficult process. Authors Geoffrey Moore and Steven G. Blank, as well as IT advisory firm Gartner Inc., have built analytical frameworks to simplify the process. Below is a description of each framework.
The Technology Adoption Lifecycle (TALC) Curve
Moore established the TALC as a tool to assist technology marketers in understanding the marketplace in which they operate. The TALC was first mentioned in Moore's book Crossing the Chasm (1991), and it has since become a well-known concept in most technology-driven sectors. The TALC's major criticism is that it is difficult to implement in real-world scenarios, however, in its defense, it must be understood that complexity usually reflects market realities, which marketers should not neglect.
Market Type Assessment Framework
In his book, The Four Steps to the Epiphany, Blank describes a framework for determining the market type (2005). In comparison to the TALC, determining market type is a much simpler process, and Blank has incorporated some of Moore's framework's major principles to some extent. The tool's simple approach is one of its potential flaws, but for early-stage entrepreneurs, this is often more useful than anything complex.
The Hype Cycle
The hype cycle, created by Gartner, is a technique for determining the maturity of a technology or application. A hype cycle is largely a tool for technology buyers and users, rather than marketers. The tool's strength is that it is built on years of expertise and is updated regularly by Gartner experts on a wide range of IT technology areas. The hype cycle could theoretically be used for other technologies, but because it is a proprietary tool, its application is limited.
What Businesses must know about Market Maturity?
If you have a truly revolutionary technology, your market will initially consist of simply a few, easily recognizable customers. Your task is to work with those early clients to develop a more robust product and choose a market niche to target as your initial market focus. Continue to find new niches that may be targeted with more marketing and sales, as well as by changing the product's value proposition to meet those niches' needs.
The specific implications of market maturity for your startup are determined by how innovative your offering is and the nature of the market, both of which must be evaluated before making any further marketing decisions.
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