White Space Analysis is one of the most respected and complex means of maximizing sales and revenue opportunities. By identifying gaps in the market, companies can generate new White Space market opportunities, in the form of cross-selling, blue ocean opportunities, and new pipelines to name a few!
In this article
- What is White Space Opportunity?
- How does White Space Analysis increase sales?
- The process of White Space Analysis
- How White Space mapping works
- White Space Analysis template and how to use it?
- Why many companies hesitate to use White Space Analysis
What is White Space Opportunity?
The process of accumulation and analysis of a company’s data and sales records and combining this with industry research and knowledge to uncover new opportunities to scale up revenue is called White Space Analysis. A company may use a White Space Opportunity as a way to navigate through a crowded playing field. It is similar to a brand positioning matrix (such as the one above), however, with quite a few differences and added layers of complexity.
Let’s take a look at a company that used White Space Analysis: McDonald’s. Observing a consumer trend and desire for healthier and lower-calorie options, Mcdonald’s began to release healthier options in their fast-food menu. One notable success was simply switching one ingredient in their McMuffins; from margarin to real-butter. This change resulted in a 50% increase in sales, reportedly from ingredient-conscious consumers.
This is how simply understanding business trends, changing consumer needs and options can signify opportunities in the market to increase revenue.
How does White Space Analysis increase sales?
White Space Analysis, although not completely identical, can often lead to discovering a new business model, pipeline or product, or even a blue-ocean opportunity (above). Though, this is not always the case.
White Space Analysis drives revenue, or reduce costs through a number of different outputs:
- You have all the given customer database information. So you don’t have to invest money in obtaining customer data.
- You can find the gaps in customers’ needs through a comprehensive assessment of their situation.
- Finding White Space opportunities makes you navigate through the red ocean in a better way. This gives you a headstart to outpace your competitors in a crowded field.
- The company can make better-informed decisions during periods of widespread market changes or economic uncertainty.
- Can better retain your existing customers.
- Find opportunities to cross and upsell to your existing customers.
- Be aware of gaps in the market that your competitors might try and close.
To build a White Space Market, you must have extensive knowledge of the industry as well as future trends. You may then capitalize on the valuable insights gained via market research to take advantage of White Space Opportunities.
The Process of White Space Analysis
White Space Analysis can help boost your sales revenue and business growth if implemented correctly. The process of White Space Analysis starts with you creating a dashboard and following the given steps.
Overview of the available White Space
You must overview your customers’ current investments. The data regarding the previous product and service purchases, the time period, the frequency must be accumulated and analyzed to derive an overview of the available White Space.
Find the right customer account
You may have a large customer pool, but you must discover those customer accounts that offer the maximum investment potential in the future, but they need not be the largest buyers presently.
Creation of new opportunities
After gathering all the useful data and coming up with new products or pipelines to offer to the right customers, you may create a new opportunity for your business.
How White Space Mapping works
White space mapping can be done through three different perspectives:
Externally Focused Perspective
Through this lens, white space mappers locate gaps in existing markets and products that can be converted into profit. Here are three common results that externally focused White Space Mapping identifies if done right:
- White Spaces with little to no presence of competitors.
- Non-consumers who can be converted into potential clients.
- Completely new markets that can transform the way your company/industry works (Blue Ocean strategy).
There is no fixed way to pursue White Space mapping in this manner. For example, when Sony’s Camera product team started scoping out the digital camera market, they located the gaps where non-consumers found no product to serve their purposes for digital cameras with interchangeable and non-mirror lenses at a moderate price. Sony produced the NEX-7 to fill this gap and was met with eventual success.
Internally Focused Perspective
This method involves a lot of introspection to map out your company’s existing abilities as well as threats from competitors. Here, White Space Mapping works almost like an offense team that identifies its own limitations that are preventing it from opening up to new opportunities, products, and markets.
This is usually why leading mobile phone companies release an in-between phone between two major model releases – to satisfy those clients who want to make a cheap purchase immediately without waiting for the next upgrade but want something new from their old phones. OnePlus identified this White Space and released the Nord smartphone.
Future Focused Perspective
This method involves applying strategic foresight to identify potential White Spaces that may evolve in the future so that the company is ready to leverage them. Having a future-focused White Space Analysis can help firms get insights from strategic foresight exercises and can have an impact on the development of all their strategies of growth.
The process usually takes place through workshops, brainstorming sessions, and hours of research. A lot of intuition is required in this method of white space mapping.
White Space Analysis template and how to use It
Some experts have managed to reduce the sophisticated and intuitive processes involved in White Space Analysis into templates that can be used by companies. This involves an X and Y plane analysis keeping the customer accounts on one plane and the services or products offered on the other plane.
You may color code your research to identify the areas of low engagement, middle engagement, and high engagement, as well as find opportunity areas and white spaces (see above).
By comparing your customer accounts with the various products/services that they used previously, you may find the opportunities and White Spaces to focus on and provide meaningful products and services to fill the gaps.
Why companies hesitate to use White Space Analysis
Amidst the benefits of White Space Analysis, many companies are still not actively searching for White Space Opportunities. A recent study by the Harvard Business Review explores in detail the hesitancy of companies when it comes to entering the White Space market opportunities. The study states the uncertainty involving the return on investment as well as the inability to gather useful data insights are the common concerns leading to hesitance to use White Space Analysis.
In addition, there is a fear that poor implementation of plans to leverage White Space Opportunity may lead to wastage of time, efforts, and financial resources, thereby furthering the companies’ reluctance to undertake White Space Analysis.
Final thoughts on White Space Analysis
White Space Analysis is a much-respected tool in the world of revenue and operations that can help companies build their niche in a crowded market. This is an effective practice that helps you gain powerful insights from the existing customer data to offer products and services that better suit their requirements. White Space Analysis gives you a competitive advantage over your competitors to maximize the benefits of delving into uncharted territory.
If you found this article useful, you’ll probably learn the newest form of the MEDDIC sales methodology; MEDDPICC. Our full guide on MEDDPICC is here!
