In business, “white space analysis” has become the ultimate buzz word.
Referring literally to the areas of a page without print or pictures, white space is a metaphor for an unoccupied market that is ripe for plucking. It is the identification of gaps in an industry where new competitors could grab a significant amount of market share and gain a powerful competitive advantage.
By exploiting gaps in the market, new players force incumbents to adapt or lose out altogether, so how can businesses find white space opportunities to capitalize on? Let’s find out.
What is white space analysis?
At its core, white space analysis is an effective practice that allows organizations to identify unmet buyer needs. It looks at how to address customers who are not completely satisfied with current products and services – whether that be within a brand’s own product line or the wider industry.
For example, when Amazon identified that people wanted to buy books online, they uncovered a white space and capitalized on it by creating the world’s first digital bookstore. By seizing an opportunity, Amazon carved out its own niche in an established market and has dominated the space ever since.
Ultimately, white space analysis enables businesses to discover opportunities for innovation. Once a company knows they have successfully identified white space, it can then create solutions to fill the gap and reap the benefits of creating a competitive advantage.
How to identify white space opportunities
Find your competitive advantage
Conducting a robust competitor analysis can help businesses find market segments where no competitor currently has a product or service. In this sense, white space analysis can help both newcomers and traditional brands identify opportunities in their industry.
Today’s businesses need to be strategic in how they define their product and brand strategy. Competitor analysis is an important first step toward developing a brand that stands out from the crowd. Identifying white space can offer additional insights into the market and help guide businesses toward innovation and success.
Take Airbnb for instance. Airbnb entered the hospitality market as a challenger brand. But they succeeded because Airbnb offered something different. They provided benefits for both renters and local hosts – an easy-to-use platform, low costs, local experience and the added extra of household facilities. These elements gave Airbnb a competitive edge over traditional hotels. That is white space.
When analysing the competition, it’s also important to know your competitors’ strengths and weaknesses. This allows businesses to identify white space opportunities where competitors are failing to provide an effective solution for customers. If a product or service needs improvement, your business will benefit from offering a better solution than what is currently available in the marketplace.
Diversify your product offering
A great starting point for innovation is to conduct white space analysis within your own company. Ask yourself what is missing from your product line? Where are customer needs not being met? Where is the white space inside your business?
Think of Uber. An innovative brand that disrupted the taxi industry. When Uber realized that customers might also have a requirement for food delivery services, they launched Uber Eats to satisfy a totally different customer need. They identified white space within their own service and in doing so, diversified their business.
Once you’ve conducted white space analysis and identified white space in your own product line or services, finding areas where you could add value, you can then decide how to innovate.
Listen to your customers
Customer needs can be identified through primary and secondary market research, interviews, reviews and surveys. These types of qualitative research will provide you with a fuller view of how your brand is perceived by customers, how customers use your products or services and where there might be room to improve or innovate.
Expand your target audience
Depending on the size of your market, it may be possible to target specific audience segments with different products or services.
For instance, McDonalds sell a variety of burgers and fries appealing to the average customer, who wants reliable, tasty yet fairly unhealthy food. However, by introducing a vegan alternative in 2020, the fast-food giant was able to appeal to an entirely new consumer base.
When considering whether to target a new audience, companies must change their strategy accordingly and create a new product, feature or service which fit the segment’s needs best.
White space analysis with Relative Insight
Brands, agencies and organizations are leveraging Relative Insight for white space analysis. Relative Insight is a text analytics software that provides businesses with an effective solution to analyze qualitative data, whether that be voice of the customer feedback, reviews, surveys or competitor data.
The platform takes two or more bodies of text and compares them, pinpointing the words, phrases, topics, grammar and emotion that are more prevalent in one data set over another.
- Establish a unique brand identity – Comparing the website copy and outbound socials of your competitors will enable you to establish your own unique tone of voice and brand identity. Our Heatmaps feature allows you to visualize which competitors you are most and least different to, and highlight what subjects your competitors are more likely to talk about.
- Understand competitor strengths and weaknesses – Comparison enables businesses to understand where competitors are missing the mark. By comparing company reviews of your competitors, you will be able to highlight their strengths and weaknesses and discover customer frustrations that require a solution.
- Analyse the language used by the public vs your brand – Through comparison, you can find where there are disconnects and discrepancies between your brand language and the language of your consumers, to ensure you create messaging that is authentic and relevant.
- Trend/ topical analysis – Relative Insight is often used to track trends and understand customer behavior. Our software can analyze customer data over time to pinpoint how consumer opinions and brand perception have changed, revealing trends you might not have known to look for.
Watch an on-demand recording of Relative Insight’s Spotlight Series event, where we revealed new ways to find competitor insights and discussed new white spacing methods to decipher what’s really going on in the minds of consumers.
Uncovering white space through white space analysis provides businesses with opportunity – to diversify, to grow and to compete for market share on a whole new level.