What’s in your market?
I spotted this from our friend @sass on Twitter some time ago and it left me thinking a bit. It was one of those thought chains I wanted to let percolate for a while before I was ready to share my ideas on the subject. I also had to think about it so I could make this a short post, rather than a wordy one.
It left me contemplating markets of different kinds, and it seems postworthy. It hearkens back to conversations around The Innovators Dilemma in several ways.
Shrinking Markets
I agree with Jeff’s tweet shown above. Incumbents, as a rule, won’t chase shrinking markets. Why would they? The incumbent, as a rule, doesn’t chase any market. They are the de facto leader in their space and to expend effort to maintain something driven by inertia would simply erode profit margin. There is no perceived value to an incumbent chasing a shrinking market.
Wired residential phone lines are a good example of a shrinking market today.
Stable Markets
Stable markets also have incumbents, but upstarts are also constantly trying to break in and take business away. I don’t think incumbents pursue stable markets either. Stable markets are the kingdom of cronyism and the good old boys. In a stable market, nobody ever got fired for buying IBM…or Cisco…or name your 800 pound gorilla. That doesn’t keep upstarts from trying, but they are fighting an uphill battle.
General networking is a very stable market today. The market for switches, routers and infrastructure isn’t seeing volatile change at a steady pace.
Growth Markets
Growth markets represent potential. My experience in enterprise business is that the big name players see growth markets as what they term green field opportunities. They see opportunity, and they believe they are dominant (perhaps even omnipotent) in a way that assures them market success.
There are two areas I see as this sort of growth market today – unified communications and cloud computing. And some of the biggest names we know are out there proclaiming a message that comes for their belief they dominate. The message isn’t coming from innovation, R&D, new creation or enlightenment. They see an opportunity they think can be converted into relatively low hanging fruit, and they’re interested in grabbing that money before anyone else does.
Emerging Markets
This is the hotbed of startups, innovators and entrepreneurs. Incumbents don’t play here either. The real key is which ones are they actively ignoring or denigrating. That’s where the hottest opportunity lies. That’s the disruptive technology that will put the behemoth in its grave because they don’t have the vision to see that possibility.
It’s not the size of the market, but the power that’s in it.
What’s in your market?