Understanding an underserved market
Underserved customers are those customers where the existing products are not sufficiently meeting their demand. The products may not have needed features, or there may simply not work well for a particular group of customers.
Why are certain markets underserved?
Different demands
A key reason why certain customers may be underserved is that they have different demands from the majority of customers. Their unique situations may mean that products that work well for most customers do not work well for them. Additional dimensions of elements of the service may be required to meet the needs of the underserved customers, and existing companies may not be prioritizing or be aware of these features.
Small market size
Part of the reason why underserved customers may not be receiving the features that they desire or need is that the market size for this group may be relatively small. There may not be sufficient opportunity for a larger firm to justify adapting their product offerings to meet the specific needs of a particular market segment.
Missed opportunity
Another reason for underserved customers is simply that the opportunity is missed. There may be a significant demand for different products, but potentially existing firms are listening to only a subset of customers such that they miss the possibility.
The opportunity of underserved markets
The existence of underserved customers presents a strategic opportunity for a company to develop products that specifically meet the needs of this underserved group. It could be adaptations to existing products, or a brand new product that specifically addresses the unmet needs. Indeed, while the market opportunity of underserved customers may not be sufficiently greater for larger companies, this may, in turn, protect companies that do address the unmet need from direct competition; companies meeting the needs of a niche market may be protected because the size is not sufficiently greater to attract competition.
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