What is market creation? To be chosen by customers continuously in a mature market where commoditization and information technology have advanced, it is important to provide value that other companies cannot follow. However, even the best value cannot be maintained forever. It is not uncommon for the value that was considered excellent when offered to the market to become obsolete over time or due to changes in the environment. The concept of market creation is important here. In this article, we would like to deepen our understanding of market creation, which is essential for the sustainable development of a company.
What is Market Creation
Market creation means creating new value by creating new customer needs. And by providing that value, we are creating new demand and creating a market. This is also known as the Blue Ocean Strategy. Corporate development cannot be realized without continuing to be chosen by customers. To achieve this, it is necessary to create and provide value that differentiates the company from its competitors, but it will be difficult to create attractive value if it only considers existing markets. Successful market creation can get out of competition for existing demand and significantly increase sales in an undeveloped market without competition.
Products that create new markets and change the lives of customers are sometimes called Market Initiating Products (MIP). Some studies suggest that half of MIPs can maintain their market share leadership for more than 10 years, while only about 0.5% of latecomers can achieve market share leadership. You can now understand how important the creation of new markets is to the development of a company.
What is Market Creation in Marketing
When you hear the term “market creation,” you may think of Apple’s iPod or iPhone, but market creation does not necessarily require the development of new products. It can also be achieved by changing customer norms and forming new habits. This concept is particularly important in market creation in marketing and can be viewed as part of branding activities.
Starbucks, for example, has established a unique position by offering a third place, a place to relax that is different from home or work. By providing the value of spending time in the space of a store, they have created a new market that is different from the existing coffee shop market and been able to provide a strong value that makes people who have never had coffee at a store want to drink it at Starbucks.
Customers choose products and services because they are attracted to the value they can gain from them. Let’s aim to create a market by finding potential customer desires without being bound by the common sense of existing customers and existing businesses, and by developing and presenting usage scenarios and methods that satisfy those desires.