Are Underserved Markets Your Hidden Source of Revenue?
When you first dreamed of starting a business, chances are you had an ideal customer in mind. Perhaps it was the busy professional in need of your dog-walking service. Or the classic car enthusiast looking for a source for vintage parts.
While these ‘typical’ customers make up the lion’s share of your market, lesser known targets could also be a source of significant revenue. These ‘underserved markets’ can be harder to find, but are well worth seeking out.
But First, An Example
The last place you might expect to find a vegan food truck would be a NASCAR event, especially when the profile of a typical fan includes an affinity for all-American fare, like burgers and barbecue. Yet not everyone who enjoys the thrill of high speed, bumper-to-bumper action may want to sink their teeth into a pulled pork sandwich.
Which leads to the underserved market of vegans at stock car races – and some interesting economics.
Let’s say you operate the only vegan food truck at the Daytona 500, which boasts an average of 250,000 visitors and attendees annually. According to Vegetarian Times, 3.5% of the American public is vegan, which means roughly 8,750 potential customers would be in attendance. If even half of them visited your truck and spent an average of ten dollars apiece, you’d pull in $43,750 selling to an underserved market. Now that’s a lot of bread, vegan or not.
Keys To Finding Your Underserved Markets
Finding and capitalizing on underserved markets takes unconventional thinking. First, you need to look for unique opportunities that can be broken down into two categories, existing but untapped, and situational.
These are the ones you can identify beforehand (like when you’re lying awake at night thinking about your business). Ask yourself how your product or service might address the needs of atypical customers. You may be surprised at what you come up with.
For instance, one underserved market for funeral parlor owners happens to be wedding planners. Believe it or not, this is a growing trend born out of a scarcity of reception spaces and a desire for unique venues. (Read more about it here.) The takeaway in this example is that no thinking is off limits.
Situational opportunities tend to pop up quickly, requiring a rapid response to make the most of them. For example, let’s say you rent out hangar space for private pilots and you’re located near a convention center where you’ve learned that a vintage car show will be held. Your underserved market might be owners of rare and expensive vehicles who prefer to prep their autos in the secure confines of your facility – for a price you determine.
The key to tapping underserved markets is a willingness to take your thinking off the beaten path. Like a vegan food truck at a NASCAR event, you might find the possibilities to be unexpectedly rewarding.