Barriers to Market Entry

Your constantly-updated definition of Barriers to Market Entry and collection of topical content and literature

What are Barriers to Market Entry?

A barrier to market entry is an obstacle (usually high costs) which prevents a product from gaining traction in a new market. Such obstacles can be natural (i.e., due to the nature of the product and the characteristics of its target market) or artificial (i.e., imposed by existing dominant players or governments to prevent newcomers and competition).

The difficulty in entering a market rests somewhere in between a monopoly (where entry is almost impossible) and a zero-cost market (where everyone can enter without facing any obstacles). While monopolies are not unheard of, in reality there is no such thing as a zero-cost market. Entering a market usually demands making an investment (even if only in time). Sometimes, this investment is significant due to the nature of the product or the market it tries to enter (e.g., high R&D costs, owning or controlling a resource, the size of the network of existing users)—these are considered to be natural barriers to entering a market. Those who do make such investments, however, then have a natural interest in preventing others from obtaining a foothold in a market—in order to limit competition and therefore maximize profit. As such, they may erect artificial barriers, through aggressive pricing strategies, advertising and image-making, predatory acquisitions, litigation, loyalty schemes, high customer-switching costs, or lobbying for government support. Regarding government support, special tax benefits for existing organizations can act as another barrier for newcomer entities.

Barriers to entry (both natural and artificial) can lead to monopolistic or oligopolistic situations in a given market. In a free society such as a liberal democracy, these then require state intervention in order to keep competition alive in that area. While such extreme circumstances are rare, designers should nevertheless be mindful of the extent of the range of barriers to entry.

Literature on Barriers to Market Entry

Here’s the entire UX literature on Barriers to Market Entry by the Interaction Design Foundation, collated in one place:

Learn more about Barriers to Market Entry

Take a deep dive into Barriers to Market Entry with our course User Experience: The Beginner’s Guide .

User experience, or UX, has been a buzzword since about 2005, and according to tech research firm Gartner, the focus on digital experience is no longer limited to digital-born companies anymore. Chances are, you’ve heard of the term, or even have it on your portfolio. But, like most of us, there’s also a good chance that you sometimes feel unsure of what the term “user experience” actually covers.

[User experience] is used by people to say, Im a user experience designer, I design websites, or I design apps. [] and they think the experience is that simple device, the website, or the app, or who knows what. No! Its everythingits the way you experience the world, its the way you experience your life, its the way you experience the service. Or, yeah, an app or a computer system. But its a system thats everything.

Don Norman, pioneer and inventor of the term user experience”, in an interview with NNGroup

As indicated by Don Norman, User Experience is an umbrella term that covers a number of different areas. When you work with user experience, it’s crucial to have a good understanding of what those areas are so that you know what tools are available to you.

Throughout this course, you will gain a thorough understanding of the various design principles that come together to create a user’s experience when using a product or service. As you proceed, you’ll learn the value user experience design brings to a project, and what areas you must consider when you want to design great user experiences. Because user experience is an evolving term, we can’t give you a definition of ‘user experience’ to end all discussions, but we will provide you with a solid understanding of the different aspects of user experience, so it becomes clear in your mind what is involved in creating great UX designs.

If you are new to the Interaction Design Foundation, this course is a great place to start because it brings together materials from many of our other courses. This provides you with both an excellent introduction to user experience and with a preview of the courses we have to offer to help you develop your future career. After each lesson, we will introduce you to the courses you can take if a specific topic has caught your attention. That way, you’ll find it easy to continue your learning journey.

All Literature

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