Latent demand is a product or service that doesn't exist that customers would buy if it did exist. In other words, it is a customer need that is unmet by currently available products on the market. The following are common types of latent demand.
TechnologyTechnical challenges that make the product impossible. In some cases, a technical breakthrough leads to a large number of new products. For example, the commercialization of the internet in the mid-1990s led to thousands of new products within a few short years.In some cases, technology rushes forward with functions and features faster than consumer preferences change. In other words, there would often be demand for old products if they were re-introduced.
CostThings that could technically be built but are too expensive to be viable. An innovation that suddenly reduces costs can make new products possible. For example, the costs of launching spacecraft into space have been reduced with time allowing for new commercial opportunities.A higher quality version of an existing product such as artisanal food.
An new target market for an existing product. For example, skin care products for men that were traditionally sold to women.
MonopoliesDissatisfied customers who are stuck with a dominant product or service. Such customers represent pent-up demand for any competitor that can improve things.A common problem that people have that goes unsolved due to failure of imagination.
Newly discovered customer preferences such as a new fashion style that is suddenly popular.
CultureA product that is popular in one culture can often spread to another culture if adapted to local preferences.A product or service that saves customers time or labor. For example, the microwave oven tapped latent demand for faster preparation of food.
A new technology or business model that doesn't sell well for many years until someone makes it more usable. All other things being equal, people will typically buy a product that doesn't damage quality of life or the environment over one that does.
This is the complete list of articles we have written about business models.
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