What is Market Saturation Evaluation?

Feb 23, 2023

What is Market Saturation Evaluation?

Generally speaking, Market Saturation Evaluation is a process of assessing the level of market share that a particular product or service has achieved in its target market. It involves evaluating how much of the potential market has already been captured by the product or service and whether there is still room for growth.

This evaluation typically involves analyzing several key factors, including market size, market share, customer demographics, competition, and potential for growth. By understanding the level of market saturation for their product or service, businesses can determine whether to focus on increasing market share or expanding into new markets.


Market saturation evaluation can be a valuable tool for practices looking to find the best location for their business.

Here are some ways in which it can help:

  1. Identifying underserved areas: By analyzing market saturation, practices can identify areas that are underserved by their particular type of service or specialty. This can help them to target locations where there is a higher demand for their services and less competition, increasing their chances of success.
  2. Evaluating competition: Market saturation evaluation can help practices to evaluate the level of competition in a particular area. By identifying areas where there is high competition, practices can avoid oversaturated markets and focus on areas where they can gain a competitive advantage.
  3. Understanding customer demographics: Market saturation evaluation can also help practices to understand the demographics of the areas they are considering. By analyzing factors such as age, income, and education levels, practices can identify areas where there is a higher demand for their services and tailor their marketing efforts accordingly.
  4. Identifying growth potential: By evaluating market saturation trends over time, practices can identify areas that are growing and likely to continue to do so in the future. This can help them to target locations where there is potential for long-term growth and success.


The Locate™ method to Market Evaluation:

Locate™ uses Competition Ratios to measure the extent of practice competition within your market. They are calculated by total population divided by the number of practitioners and should be compared to the market saturation standards for each practice type.

For example, a ratio of 2,000 for General Dentistry within a defined market area is considered saturated. Each practice specialty has a respective standard saturation ratio, or what we call a RealRatio*.

What is a RealRatio?

A RealRatio is a proprietary ratio of population to practitioners used to evaluate competition ratios to indicate when a market generally is considered to be saturated. For example, the RealRatio for a General Dentist is 2,000. A ratio higher than 2,000 would indicate the market has potential for an additional practitioner(s). A number below 2,000 indicates the area is already oversaturated and should be evaluated carefully. Each practice specialty has its own RealRatio value.

The Locate™ Advantage.

Locate™ also uses Census Block Groups (CBGs) instead of Zip Codes or Concentric Circles to measure any market information. CBGs are the smallest geographical unit for which data is published, allowing for the most precision and relevance in your results. Other methods are dangerously outdated and do not reflect patient behavior, which may generate irrelevant results and market data.

Overall, market saturation evaluation can provide practices with valuable insights into the market conditions of different locations, helping them to make informed decisions about where to locate their business for the best chance of success.

Click here to learn more about your market. Live Market Finder – Locate ™ Location Strategy Services (formerly Realscore) | Locate™ (locatestrategy.com)

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