Understanding Market Maturity
Understanding Market Maturity
Understanding Market Maturity. It May Be A Hidden Mature Market
Think about market maturity. The TV set market would seem to be the last market to be described as immature. After all, television has been a significant part of our lives for more than 50 years and the brands are firmly established: Sony, Panasonic, Samsung, etc. But there’s no accounting for technology to completely change the landscape.
The hot technology in television anymore is, of course, HDTV. Or is it LCD? Or is it DLP, or plasma? Is there a difference? You get the point. With the influx of high-definition, flat-screen televisions, the market is flooded with options that have left customers confused.
It’s interesting that customers are so attracted to the new technology that they’re not waiting for the market to sort itself out.
Experts say that more high-definition televisions (4K is right behind it)will be sold this year than conventional sets. Yet, who knows what technology is best. Is it the “It’s the mirrors” of DLP sets?
LCD sets seem primed to take the lead, according to recent expert analysis, but plasma sets are still going strong. Good luck, frankly, asking a retailer which technology is best. The technologies have not completely worked themselves out. But when thinking about market maturity it is correct to say this is a mature market. But consumers are having trouble making an informed choice. An investigation of the options finds strengths and weaknesses for all of them. Plasma has “burn-down” but is the best in viewing from an angle. And so forth.
Where is the Advantage? Where are the Market Maturity Opportunities?
The way for manufacturers to take advantage of this suddenly immature market by making the choice simpler: Develop brands that have meaning to audiences within in the framework of the new technology.
The key word here is meaning.
The brand has to be meaningful enough so that customers want to see themselves in the brand. They need to see that owning a Sony with HDTV, for example, says something about them and is more important than simply owning any HDTV. However, manufacturers aren’t doing that right now.
They are selling the technology, which doesn’t differentiate them from the competition. If everyone is saying the same thing – saying, in effect, “Our technology looks the best” – then the customer will most often default to the market leader or buy based on price.
The latter of which explains this piece of recent news: Vizio, which does very little marketing but is priced significantly lower than the rest of the market, is now the North American market leader in LCD TV sets, according to recent research by DisplaySearch.
Change Happens and Mature Markets are Illusions
How did that happen? How did understanding market maturity escape us?
It’s simple really. Because everyone in the market is saying the same thing, many customers are believing what they hear: The technology is all the same. So they just shop for price. No matter how well manufacturers are glamorizing their message, that’s the bottom-line message consumers understand. They simply haven’t been given a reason to choose, let alone pick a brand that says something about themselves when they use that brand.
An example in point of market maturity Sony’s recent “Color. Like No Other” campaign features one of the visually arresting TV commercials in recent memory. One that featured 250,000 brightly-colored super-balls bouncing down the streets of San Francisco to the tune of “Heartbeats” by Swedish singer Jose Gonzalez.
The spot was one of the most honored at the 2006 Clio Awards, the advertising industry’s Oscars. But the ad didn’t move the needle. As beautifully produced as it was, it was essentially saying the same thing as what the competition was saying: “Our technology looks the best.” Or, if you prefer, “Color. Like No Other.” (Read about the failure of SONY in a market study here)
The Market Decides What is Mature. It defines Market Maturity
Eventually, the television brands will sort it out. Many of those in play have traditionally developed strong brands, but right now they are simply selling the market. Once one technology permanently surpasses the other – or, heaven forbid, another technology comes into the market.
The brands will start positioning themselves in the marketplace. However, there is a missed opportunity right now. The brand that doesn’t wait to position itself, and does it effectively, will win. (Keep an eye on Vizio. They announced they are now tripling its advertising budget.)
First is no Guarantee
This about this: The first brand in disposable diapers more than 30 years ago was Pampers. Because it was the first entry into the market, its name became synonymous with disposable diapers. However, Pampers simply sold the new technology and didn’t develop a brand. In came Huggies.
Although they were comparably late in the game, they developed a meaningful brand that spoke to mothers. Those mothers saw themselves in the brand and understood that buying Huggies meant you were a good mom.
Therefore, even though most of us call disposable diapers “Pampers” just like we call tissues “Kleenex,” Huggies is now the market leader and Pampers has been struggling to catch up for the last 20 years.
If you are in an immature market, even one that became immature because of new technology, it’s never too early to develop a brand that’s meaningful to the target audience. Truth about your brand and positioned against your competitors. Waiting can leave you desperately trying to catch up. That is market maturity.