The Theory of Natural Limits
Encyclopedia
The Theory of Natural limits was introduced by American economist and author Tom Osenton
is his 2004 book The Death of Demand: Finding Growth in a Saturated Global Economy (Financial Times Prentice Hall) and states that every product or service has a natural consumption level that is determined after a number of years of sales and marketing investment (usually around 20-25 years). In effect, a relative universe of regular users is naturally established over time after which any significant expansion of that universe becomes extraordinarily difficult. The point at which natural limits are reached is known as Innovation saturation
.
was launched in 1954 with 400,000 subscribers and grew through the 1960s, 1970s and 1980s until reaching 3.5 million subscribers in the late 1980s where it has remained ever since. With some estimates of up to 100 million sports fans in the United States, many at Time, Inc. believed that Sports Illustrated's subscription base could have been much higher. However, after many years of investment, the sportsweekly's natural and most profitable consumption level was reached where it has remained for more than 20 years.
Tom Osenton
Thomas George "Tom" Osenton is an American economist, publisher, educator and author. Osenton spent a quarter century in media including stints in television and consumer magazines...
is his 2004 book The Death of Demand: Finding Growth in a Saturated Global Economy (Financial Times Prentice Hall) and states that every product or service has a natural consumption level that is determined after a number of years of sales and marketing investment (usually around 20-25 years). In effect, a relative universe of regular users is naturally established over time after which any significant expansion of that universe becomes extraordinarily difficult. The point at which natural limits are reached is known as Innovation saturation
Innovation saturation
Innovation Saturation was introduced by American economist and historian Tom Osenton in his 2004 book The Death of Demand: Finding Growth in a Saturated Global Economy . Innovation Saturation is a business cycle theory that posits that every company experiences two major growth trends during its...
.
Statement of the theory
"Every product or service has a natural consumption level," said Osenton. "We just don't know what it is until we launch it, distribute it, and promote it for a generation's time (20 years or more) after which further investment to expand the universe beyond normal limits can be a futile exercise."Examples
For example, the American weekly consumer magazine Sports IllustratedSports Illustrated
Sports Illustrated is an American sports media company owned by media conglomerate Time Warner. Its self titled magazine has over 3.5 million subscribers and is read by 23 million adults each week, including over 18 million men. It was the first magazine with circulation over one million to win the...
was launched in 1954 with 400,000 subscribers and grew through the 1960s, 1970s and 1980s until reaching 3.5 million subscribers in the late 1980s where it has remained ever since. With some estimates of up to 100 million sports fans in the United States, many at Time, Inc. believed that Sports Illustrated's subscription base could have been much higher. However, after many years of investment, the sportsweekly's natural and most profitable consumption level was reached where it has remained for more than 20 years.