How to Identify & Target White Space Customers

Discover the hidden market potential of white space customers. Learn how to identify untapped segments, minimize risks, and unlock new growth opportunities for your business.

White space customers represent those untapped market segments that often remain hidden behind the glare of familiar, established audiences. These customers offer a chance to expand your business by addressing needs that competitors have overlooked. Understanding how to spot these gaps can clarify where your future growth may lie while helping you tailor clear, focused strategies. Identifying white space customers involves not just analytical techniques but also a keen sense of customer perception metrics and customer behavior. When you see these untouched areas, you can pave the way for new opportunities that stand apart from your existing clientele.

Let's take a closer look at practical ways to identify and engage these promising segments in your market.

What are white space customers?

Ever wonder who your brand is missing in the market? White space customers represent untapped market segments that aren't currently being served by your brand or your competitors. These potential customers exist in gaps between established market segments—areas where needs remain unmet or underserved by existing products and services.

White space customers matter because they represent growth opportunities without the intense competition found in saturated markets. They're the people who might say, "I wish someone would make a product that..." or who cobble together solutions because nothing perfectly addresses their needs.

In the CPG world, white space customers might include:

• Consumers with specific dietary restrictions not well-served by mainstream offerings
• Demographic groups whose cultural preferences aren't reflected in current product lines
• People seeking particular product attributes (sustainability, functionality, convenience) that current options don't fully deliver
• Consumers at price points between existing market tiers

For example, a beverage company might discover white space customers in health-conscious parents looking for low-sugar, nutrient-dense drinks for school-age children—a segment that falls between sugary juice boxes and plain water, with needs distinct from both adult health beverages and toddler drinks.

White space customers differ from niche markets in scale and potential. While a niche might be inherently small, white space segments often represent substantial untapped demand that's simply been overlooked or misunderstood by market players.

Identifying these customers requires looking beyond your conventional market definitions and competitive landscape to spot emerging needs, behavioral shifts, and gaps in the current market offering.

How to identify untapped customer segments in your market

Are you looking at your market through the right lens? Finding white space customers means challenging your existing market frameworks and searching for gaps where unmet needs exist. This process combines data analysis, market observation, and creative thinking.

Start with these practical approaches to spot untapped segments:

1. Conduct gap analysis in your category landscape
   • Map current products against key attributes (price, benefits, ingredients)
   • Look for "empty zones" where few or no products exist despite potential demand
   • Identify underserved need states that fall between established segments
2. Analyze complaint data and product reviews
   • Mine customer service interactions, social media comments, and product reviews
   • Look for patterns in "wish it had..." or "almost perfect except..." feedback
   • Pay attention to consumers who are adapting or modifying your products
3. Examine adjacent categories for inspiration
   • Study how consumers are solving problems in related categories
   • Look for successful innovations in other markets that could translate to yours
   • Identify consumers who are crossing category boundaries to meet their needs

When conducting research with potential white space customers, use open-ended methodologies. Traditional segmentation surveys might miss these groups entirely if you're asking the wrong questions.

Consider this approach for a snack food company:

The key is looking beyond your existing framework to spot the opportunities others have missed. This often means challenging industry assumptions about who your customers are and what they truly value.

How to develop strategies that convert white space customers

Ready to win over these untapped segments? Converting white space customers requires more than just awareness—it demands a thoughtful approach to product development, positioning, and go-to-market strategy.

White space customers often need to be convinced not just to choose your brand, but to enter a category they've previously avoided or to think differently about solving their needs. Here's how to build effective conversion strategies:

1. Address their specific barriers to entry
   • Identify what's kept them from engaging with existing solutions
   • Develop products that eliminate these specific pain points
   • Create messaging that directly acknowledges and resolves their concerns
2. Build credibility through targeted proof points
   • Offer samples and trial sizes to reduce perceived risk
   • Showcase testimonials from customers with similar needs or backgrounds
   • Provide education about your unique approach to solving their problems
3. Meet them where they are
   • Identify the channels and touchpoints where these customers already spend time
   • Consider non-traditional retail partners that align with their shopping habits
   • Use messaging and imagery that reflects their lifestyle and values

For CPG brands, product formulation and packaging play crucial roles in converting white space customers. For example, a food brand targeting health-conscious consumers who avoid conventional snacks might focus on:

• Clear ingredient transparency on front-of-pack
• Packaging that emphasizes nutritional benefits without clinical language
• Flavor profiles that bridge familiar tastes with new nutritional profiles
• Sizing options that support their specific usage occasions

Remember that white space customers may require more education than typical consumers. They need to understand not just why your product is better than competitors, but why it's worth changing their current behavior or trying a new category solution.

At Highlight, we specialize in providing CPG brands with the insights needed to refine their products and resonate with their target audience. Our product testing software connects brands with representative testing audiences, ensuring that the feedback you receive is honest and actionable. By leveraging strict quality filters—discarding just 1-2% of survey data compared to the industry average of 30%—and achieving 90%+ completion rates, we transform the product testing process. Moreover, our rapid turnaround of about 3 weeks from recruitment to actionable insights means you get reliable data that empowers you to address white space opportunities faster.

If you're considering product renovation or looking to understand consumer perception better, we can help. Our solutions also include in-home usage testing to gather real-world feedback.

How to differentiate white space customers from your existing segments

How can you tell if you've found true white space or just an extension of current segments? Distinguishing genuine white space customers from your existing segments is crucial for effective strategy development.

True white space customers differ from your current segments in fundamental ways:

1. They have distinctly different need hierarchies
   • Their primary purchase drivers vary significantly from your core customers
   • They prioritize different product attributes or benefits
   • They evaluate success by different metrics than your typical customers
2. Their category engagement patterns differ
   • They may use products in unconventional ways or contexts
   • Their purchase frequency or consumption patterns stand apart
   • They may combine your category with others in unique ways
3. They respond to different messaging and triggers
   • Value propositions that resonate with core customers fall flat with them
   • They're motivated by different emotional or functional benefits
   • They have different reference points for evaluating products

When analyzing potential white space segments, create comparison matrices to highlight these differences:

This differentiation process helps determine whether you need to:

• Create entirely new products and brands for these customers
• Extend existing lines with significant modifications
• Adjust messaging while keeping core products the same

The clearer the distinction between white space customers and existing segments, the more likely you'll need a dedicated approach rather than simply expanding current strategies.

Final Thoughts

White space customer analysis is more than just a strategic exercise—it's a critical lens for understanding the hidden potential within your market. By systematically exploring unserved or underserved customer segments, businesses can uncover remarkable opportunities for growth that competitors might overlook.

The journey to identifying white space customers requires a blend of analytical rigor, creative thinking, and strategic insight. It's not about chasing every potential market gap, but carefully mapping where genuine customer needs intersect with your organization's unique capabilities. Think of it like solving a complex puzzle, where each piece of market research and consumer insight brings you closer to revealing a complete picture of untapped potential.

At Highlight, we've seen firsthand how thoughtful white space analysis can transform product development and market positioning. Our work with brands across industries consistently demonstrates that the most successful innovations emerge not from following existing paths, but from courageously exploring the spaces between them.