The definition of a relevant market is based on the interchangeability and substitutability of competing products or services. This concept is fundamental for companies to clearly identify in which market they compete and to develop effective business strategies.
The relevant market is not limited to a geographic space, but also considers temporal and material aspects. The temporal dimension is crucial for analyzing market conditions over time and adapting strategies accordingly. On the other hand, the geographic delineation of a market takes into account both the supply and demand for goods or services, covering specific areas where they are marketed and solicited.
Identifying substitute goods is essential for understanding competition in a relevant market. Furthermore, the material delimitation refers to the products or services exchanged, including their close substitutes, within a specific time frame. These aspects are crucial for entrepreneurs to make informed decisions about prices, sales strategies, and marketing to attract consumers and ensure the success of their businesses.
Consumers are fundamental in defining a relevant market, as they determine which products or services are substitutable for each other and how far they are willing to travel geographically to acquire them. In this sense, companies compete in terms of offering the same utility or usability to consumers. Therefore, it is important to consider all these aspects when defining a relevant market to succeed in a competitive business environment.
