a 3 Examples of New-Market Disruption by John David Hartigan | Jun 16, 2022 | Business, John David Hartigan
Innovation brings on disruptive technologies and disruptive investments that can change the world quickly, which means they come with some volatility. Disruptive innovation involves the technologies used to make them easy to use and available to the larger, non-targeted market. New-Market Disruption is one kind of disruptive innovation that has gained visibility in the industry. Here’s a deep dive into this unique concept and three examples of how it impacts the market.
New Market Disruption Explained New-market disruption occurs when an organization develops a new segment in an existing market to reach unserved or underserved customers. In addition, this concept always Targets non-consumption. Makes revenue at lower prices per unit sold than the incumbent businesses. Provides lower performance for existing customers but elevated performance for non-customers.
3 EXAMPLES OF NEW-MARKET DISRUPTION Three examples of new-market disruption in action inspire your organization’s strategy:
Personal Computers and Smartphones Throughout the years, the capabilities of personal computers improved to the point that mainframe computers became virtually obsolete. Later, smartphones became an innovation that brought computing technology to another new market segment. Where people previously had to purchase a personal computer to access the web, now they have the option to do so from the palm of their hand for only a fraction of the cost. As time progresses, smartphone capabilities—poised to disrupt the digital photography industry—are improving to the point that personal computers are becoming less necessary.
Transistor Radios Another example of new-market disruption is the introduction of the transistor radio, which shook up the radio market in 1954. For 30 years, the market was dominated by large, expensive stereo systems. The 몭rst portable transistor radio targeted the less wealthy. While the transistor radio was low quality, it provided mobility at an a몭ordable price. The quality of portable radios later improved dramatically with the introduction of another tech such as the Sony Walkman, MP3 players, the iPod, and smartphones, rendering in-home stereo systems less attractive.
Shared-Mobility Services While owning a car has advantages: 몭exibility and personalization. It’s not 몭nancially possible for many people and often is not needed for people residing in the city environments. To cater to this population, shared mobility services provide 몭exibility at a price tag that is better than purchasing a vehicle. This example illustrates the concept of a new-market disruptive innovation providing a level of performance deemed too low by mainstream market customers but acceptable by members of the new market segment. Learning and comprehending disruptive innovation can enable leaders to assess their organization’s position in the competitive market, understand the factors in몭uencing disruption, and craft strategies to avoid or drive disruption.
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