Natural market

The area on a positioning map with preferences but no brands has not been defined.

It can be called a natural market, where consumer-recognized needs and wants are not currently being met.

Did you ever go to look for a product that you bought for years only to find it had disappeared? Or perhaps you went to repurchase a favorite product but found that it had been "improved" in ways that made it less beneficial for you, not more. These circumstances, and others, lead to what can be called natural markets.

A natural market is a market for consumer-recognized needs and wants that is not currently being served. They arise from companies either deciding to move away from their natural market deliberately or moving away from their natural market without recognizing it—at least not until it may be too late.

Buick, for example, is very concerned about the average age of their customers, reportedly averaging 65 years old. So they want to reposition the brand to attract younger consumers. Even if Buick were to do this successfully, where would the former Buick buyers turn for vehicles designed to their needs and wants? Interestingly, all automobile companies covet younger buyers and this can lead to a situation where there is a natural market for older buyers.

For another example, consider product improvement. Not too many years ago personal hair dryers had about 750-850 watts of power. Millions of them were sold as they apparently met consumers' needs and wants. Then hair dryers had 1000, then 1250 and now 1500-1875 watts of power. Did we miss something about the evolution of hair? A barber told us that these high-wattage hair dryers are more like blow torches. Sure you can turn them on low, but today's low is yesterday's high.

Every new version of an automoble introduced in the past decade was "longer and more powerful." Someone bought and was happy with those smaller cars. Ironically, for every larger vehicle a natural market forms for new smaller vehicles.

Want to print out some of these pages and highlight them with a traditional yellow highlighter? Forget that since today's highlighters are all day-glow colors. Some little company could make money by simply bringing back yellow!

Another way to think about natural markets is that they describe preferences on a positioning map without nearby brands. These preferences are a natural market that represent real needs and wants that some company can try to meet.

To summarize, natural markets have these characteristics:

• "Consumer-recognized" because the needs and wants are apparent to consumers.
• Typically reflect physical and psychological needs that do not change over time.
• Often are markets that once were served to consumers' satisfaction.
• Could never have been served, but need or want always apparent.
• Represent market opportunities, but the term "marketing opportunity" applies to other situations as well.

The reasons for natural markets include:

• Constant preferences
• Budget constraints
• Budget irrelevance (consumers willing to pay more for specializaton)
• Optimal preferences

All natural markets are market opportunities and companies that recognize this can do good business in them. It's quite easy to find examples of consumer natural markets where products once were offered—and importantly were successful!—but are inexplicably dropped.

Summary of the marketing logic

• Look for natural markets.
• Create products to serve them.

Follow up

Illustration

Examples