Can you guess where the next opportunity for market growth lies?
Business managers, including successful SMEs, will have to learn to create new categories to see further growth in an ever fragmenting and saturated market. It does mean that manufacturers and providers of services will have to milk existing brand capital to create new revenue opportunities. Quality signature, reach, network of distributors, core expertise plus instant recall are the capital that must be leveraged to open doors in a new market. It is called familiarity.
You wonder why Lipton has moved into the bottled the ice-tea category; PZ’s Mamador taking on the seasoning market.
Apple and Disney searching for new revenue channels in the video streaming market, and more. These are signs that tell the future. If a business continues to survive on one or two products for too long it will stagnate. Excitement must be geared up by moving further afield to test new water. Or didn’t they say that the best way to be certain of the future is to create it.
So in which category is your business currently operating? It is time to go back to the product creation canvass and create something new. Here are few areas to fine-tune before you create a new market:
a. Don’t move too further from your core expertise. Don’t forget that you are only adding a business – you are not running away. Every new field has some top secrets. If you haven’t been around for too long you may not have access to those secrets.That may be your undoing. So stay around your core expertise by creating new form or range or flavour of a pre-existing product or service. Mamador is still home in the seasoning category since the brand understood the food category having sold healthy,low cholesterol cooking oil and bread spread for years. Likewise Lipton has sold tea all its life – apparently it shouldn’t be a stranger in the ice tea market.
b. Take root before you move. If you are new in your existing category, don’t extend yet. Take time to sink your root by providing quality products and services where you are right now; engage your current market and network through sales promotion and innovation. When your image is fully entrenched in one particular category you can take the plunge. Meanwhile, this does not mean that you are exiting present market – you are just trying to boost your bottom-line, as well as future-proof your brand.
c. Be sure of the market size of your new market. The Naira potential of your new market is critical to success. In real monetary term, do you know what the total size of your market is? For instance the global travel and tourism market is worth $8 trillion, the carbonated drinks market is valued at $412 billion. If you don’t know the size and
value of the new market, you may as well be plunging into the unknown. This is why you should do your market research before executing your extension plan.