Palm Computing was not the first company to use common technologies to build a personal digital assistant (PDA), but it was the company that ultimately created and defined the market. Despite three attempts by Microsoft Corp. to challenge the market leader, the Palm platform continues to dominate.
What is unique to Palm’s family of products is the packaging of interface and services. The Palm products, compared with Microsoft-based palm products, are simple to use, stable, have good battery life, and install software easily. Technologies contribute to each of these attributes, but how they are chosen and then presented to the user are what makes the difference. Palm’s founders intentionally chose these interfaces because they concluded that the gap was in usability, not computing. They realized that the product consists of much more than the object that people hold in their hand; it includes all of the ways that the customer works with the product.
The way to look at a new market is the way that Palm Computing did when it identified its location: the right problem to solve. One reason so few markets are created is that most companies focus on the solutions that they make-the products they are already selling. They miss new market opportunities by trying to find matches for products to which they are already committed. This leaves a considerable amount of room for companies that choose to create new markets by looking at problems, not products. Your real opportunity is in problems.
New markets exist in potential. The creation of a new market occurs at the convergence of perceived need with acceptable solution in a way that did not previously exist. That phrase, “did not previously exist,” is part of what makes it difficult for some people and companies to succeed in creating-and dominating-new markets.
The process of creating new markets requires identifying and satisfying potential. The potential may develop to be either the untapped or unrecognized needs of a large group of users or an acknowledged need that demands a solution. Either way, a need signals that potential. Some of these needs are basic life essentials. For example, a breakthrough in urban transportation may create a new market in what seems like an instant. Other needs are leisure products that will do well in enhancing existing markets or creating new ones. Potential new markets are not waiting for you and your business to find them. They are waiting to be brought into existence.
Creating and dominating a new market is always a difficult task, but you can make it easier if you work systematically. You can follow four paths to create a new market, some of which are easier than the others. You have the option of consciously choosing one or another of the paths, depending on the circumstances of your business.
As you look at markets, your choices are that you can attempt to create a new market-
· With unknown customers and unknown products
· With known customers and unknown products
· With unknown customers and known products
· With known customers and known products
Unknown Customers, Unknown Products
For many executives, the most exciting prospect is to go after new customers and new products together. Starting from the equivalent of a blank slate allows the most creativity, and that can be fun and immensely satisfying.
When you do not know your prospective customers well, you have the challenge of learning about them. You may be able to define the customers and their expectations as you go, showing them the traits that define their future needs and problems. Then you can possibly dictate the solutions that they should use to solve those problems. The same excitement can come from being able to create new products. You can decide what the product should do, how it should look, and how it should go about resolving the problem that you defined.