What does "market saturation" refer to?

Market saturation refers to the point at which a product has reached its maximum potential in a given market. This means that nearly all available customers have purchased the product, and there is little to no room left for growth in terms of new customer acquisition. At this stage, the market can be considered "full," leading to increased competition among existing players as they vie for the same customers.

The concept of market saturation is significant because it affects pricing strategies, promotional efforts, and product innovations. Companies may need to explore other markets, diversify their product offerings, or improve their products to stimulate sales within a saturated market. Understanding this concept helps marketers and business strategists in planning their market entry or expansion strategies effectively.