Spotting a gap in the market is how we all think about business success. We often talk about a successful business or entrepreneur as someone who spotted a gap in the market. Often this is someone who spotted the right gap, at the right time to exploit it. This article looks at some ways to see your search for your gap in the market.
Why do you need to spot a gap in the market?
A business based where someone has spotted a gap in the market should automatically be remarkable. They’ve been able to see something they can provide which no one else has done before. At least that’s the usual way to think about finding a gap in the market business opportunity.
They might have found something new to provide; Rubik’s Cube, kids’ scooters, a piece of the moon are all examples of these gap exploiters. These were all at one point highly original products, but over time copycats came in and did their own versions. Find out more about productising at Adventures in Products.
You can see some of the hot areas where there are gaps in the market just now in this article.
The gap in the market business model
Or your gap in the market might be providing a product or service in a completely different way.
LoveFilm rented DVDs, but they captured the market by sending them through the post, rather than using the video shop model, adding convenience and a huge list to choose from.
And now they’re out of date because others came in quickly to deliver films instantly by streaming, so Netflix, Mubi and Amazon have taken over this space in different ways.
Gumtree provide the classified ads which local papers have made money from for centuries, but they’ve changed the model by making 99% of the ads free and putting it all online.
Tom Peters calls this “creative swiping”, where you take an idea from someone else, and give it a good twist to make it into something new. Here’s my take on creative swiping.
Copying someone else’s gap in the market
The easiest way to find your gap in the market is to copy someone else.
LoveFilm copied the original US Netflix, Gumtree copied Craigslist and transferred these business models from the US to the UK. If you’re reading this in the UK, you’ll often find that the US can be a couple of years ahead of us, so this is a rich source of ideas for creative swiping.
You could research what other people are doing in different countries (or other cities in the UK) and work out what gap you might be able to fill where you are.
Ideally, you want to do this before whatever you’re copying has been widely written about, otherwise, you’ll find a bunch of other people who are all doing the same thing, all launching at the same time as you, and all aiming at the same gap in the market.
Use trends to find your gap in the market
You can find some amazing ideas by absorbing yourself in different trends in business thinking and what’s happening in particular markets. The world is moving pretty rapidly, and technology and economic forces are very fluid. The trick here is to research into certain areas, especially those which are not altogether obvious.
If you have some knowledge in a particular area already, that’s good, but you don’t necessarily need to be a programmer to understand what’s happening in online technology. You can always hire programmers later. In fact, it can be better if you don’t have any industry knowledge as you won’t have any preconceptions and blind spots.
One of my recent clients identified a gap in the market for a particular kind of product. Once she was certain that there was a viable business, she bought 2 days per week of consultancy time from someone who was already very established in that industry.
That way, she was able to tap into a deep level of knowledge about suppliers, materials, manufacturing processes, without having to learn all this stuff from scratch.
Forget about inventing physical products – go digital
One common preconception about finding your gap in the market is that you need to develop a physical product. IMHO, that’s a somewhat 20th century way of thinking. My experience of working with clients who have invented physical products is that you spend all your time and money on getting to prototype stage, and then have no cash or energy left to get your product made or for marketing. This can be a rapid route to failure.
For us 21st century entrepreneurs, you can grow and scale a digital product (or productised service) far faster and cheaper than the long slow process of building a business based on a new physical product. This is one of my specialist subjects, and you can find out more about productising at Adventures in Products, my other website.
Where To Get Started
You might think about:
- Chris Anderson’s The Longer Long Tail and Free to get a grip on new business models.
- Jessica Livingston’s Founders at Work to see how others have done things.
- Seth Godin’s Purple Cow, and his blog. Here are my thoughts on Seth Godin, and why you should definitely read him.
- Can you make money from helping people to choose…
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Photo credits – thanks to Flickr members, Herman Turnip (not his real name) Rajeev, Robert Couse-Baker, Cheryl Brind