Market Segmentation Quantum Mechanics

Oftentimes I have been asked, do you think there is a market for this? Will people want this? The underlying question is not whether or a product has a demand, but whether there will be enough volume of sales given constraints. Because of my background in device physics, I can’t help but drawing allusions to energy levels of the Particle in the Box system in quantum mechanics.

In the real world there is a continuum of demand. Demand can be graphed as a continuous line that plays to every fancy and whim of human desire. Because there is no end to the detail and desire of individuals, this line is continuous. In the world of electronic gadgets, it scales up through every size of screen size and function imaginable to make an infinite expanse of performance, connectivity, size, and feature-set. There is no end to the definition and fine tuning of such demands. In a very real way, demand is a continuous curve that is completely insatiable. It is only when constraints are present, that single solutions fall out. I am reminded of the Particle in a Box model from quantum mechanics. The model is basically a plot of energy in a confined space. A particle given infinite space has continuous solutions, much in the same way our infinite imaginations create a continuous line for demand. When constraints are put on the system, such as physical confinement, discrete solutions are formed. These discrete solutions represent the only solutions that can exist. For single confined particle systems, these solutions represent discrete energy levels; for product demand, market segments. In our system the constraint of demand could be money to buy such products or even other products that fulfill portions of demand. When these constraints are present, we see a very different market segmentation that has solutions such as phone, laptop, desktop, and server.

This idea is not perfect. Multiple product solutions like netbooks, tablets, and laptops or smart phones and handhelds perhaps are solutions that are very similar and yet still exist. To further the model, we could start talking about another effect in physics, band splitting. Given the organic nature of people and the host of factors and constraints, market segmentation takes a bit more skill to assess its complexity. Markets make for very complex landscapes that are in continuous flux. Killer applications or changing perceptions and usage models vastly alter and reshape the system. In any event, making mathematical models do bring insight–but don’t retire market researchers just yet.

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