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How do you know if a category is saturated?

Posted by Tasnim Ahmed

February 17, 2021

Whenever an entrepreneur enters a market, it’s very important that they do some kind of research regarding the market size, competition and the like. It’s even more crucial that you have an idea about the viability of the business that you’re planning to establish. But, how do you determine if a market is saturated? Or if there’s any scope for you to enter the said market? Will it be viable in the long run? All these questions need to be answered, whenever you make any business decision. To know your company’s share in the market, you just need to divide your total sales by that particular industry’s total sales, and you will have your share in the market. However, what if in your research you notice that there isn’t much demand from new players, and the market is saturated? Do you abandon all your plans and just give up? Or rather you make a new strategy?

Market saturation in simple terms means that a market is not generating any new demands for a particular product or service. Reasons can be many for this type of a scenario, namely many producers, outdated products, decreased requirement etc. The main outcome of a saturated market is that the growth opportunity is stunted; which may or may not be the case.

Saturated market also means that there’s a demand and profits can exist. So, how does one succeed in a saturated market? Innovation, consistency, creativity and strategy will help you deal with the phenomenon, and stand out in the market. Consider the ways mentioned below to help your business get noticed in a market filled with competition.


Make research and development the core tools of your business and products. There’s nothing in this world which says ‘Buy Me’ apart from cutting edge innovation in whatever you’re selling. Be it software, consumer durables or service, everything and anything needs to be consistently worked on, and differentiated from your competition which in turn will get you sales by setting you apart from the rest.

Price bracket challenge

This is an interesting and a double-edged knife sometimes to work with. However, you get this right and you would have already created a space on your consumer’s mind. Never compete with your competitors in a price war. It just shows you’re desperate to sell your product. Either choose to ballpark it in the region where every other competitor is playing in the market so that your price does not shine rather your qualities do, or price it at a premium to show that you’re different than the rest. This needs to be taken into great consideration, as you either make yourself dear to the budget conscious, or play the high street game.

VAS: Value-added services

What else is special in your product that separates you from the herd? That’ll always be the key and will always give an edge. Any value addition to your product is winning the game in the long run. Again, the key word here is “Being Different”. Different from the rest.

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Exceptional customer service

Exceptional customer service is one of the simplest ways to cut the clutter in an over saturated market. Sell the same stuff or service or product; however, if your customer service is bang on, then you would be decimating your competition by not even trying to do so.

A saturated market does not mean that the market is dying; it means that the market is so big that it needs many layers and there are still many eager buyers who are keeping all the players invested, otherwise it would have been an open field. Unique sales strategies and effective marketing are always the key points and the game plan, that will help any entrepreneur and company to survive in a saturated market. The challenge is to never fall in a price war and make your product just another commodity, but rather making the prospective consumer see your value and the positive addition that you would do to them if they choose you.

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Tasnim Ahmed
Tasnim Ahmed

Tasnim Ahmed is a content writer at Escalon Business Services who enjoys writing on a multitude of subjects that include finops, peopleops, risk management, entrepreneurship, VC and startup culture. Based in Delhi NCR, she previously contributed to ANI, Qatar Tribune, Marhaba, Havas Worldwide, and curated content for top-notch brands in the PR sphere. On weekends, she loves to explore the city on a motorcycle and binge watch new OTT releases with a plateful of piping hot dumplings!

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