jerryking + michael_raynor   6

Market Segmentation
Jim, I believe you can best help your sister in her market segmentation challenge by taking a hard look at the behavioural approach to market research popularized by folks like Clayton Christensen, and his disciples, Mike Raynor at Deloitte Research and Scott Anthony at Innosight. Here is the short introduction to the approach (http://www.forbes.com/forbes/2003/1013/082_print.html). The slightly longer, but more detailed version can easily be found online in the Spring 2007 MIT Sloan Management Review article, “ Finding the Right Job For Your Product”. Once you’re on top of it, you might share it with your sister as she thinks about the print market in Halifax.

The course you’re contemplating recommending, segmenting by target attributes (i.e. using D&B data and looking at size of company), seems straightforward and easy but that’s because that’s the data--the only data--to which you readily have access. The danger of recommending this traditional approach to segmentation is that if your sister pursues it, it will surely lead her into to zero-sum competition with other print & ad agencies in the Halifax. She will be hard-pressed to find sustainable new opportunities this way.
market_segmentation  market_research  marketing  Michael_Raynor  Clayton_Christensen  advice 
november 2011 by jerryking
Creating A Killer Product
10.13.03 | Forbes Magazine | by Clayton M. Christensen & Michael E. Raynor.

Three in five new-product-development efforts are scuttled before they ever reach the market. Of the ones that do see the light of day, 40% never become profitable and simply disappear.

Most of these failures are predictable--and avoidable. Why? Because most managers trying to come up with new products don't properly consider the circumstances in which customers find themselves when making purchasing decisions. Or as marketing expert Theodore Levitt once told his M.B.A. students at Harvard: "People don't want to buy a quarter-inch drill. They want a quarter-inch hole." ...Managers need to segment their markets to mirror the way their customers experience life--and not base decisions on irrelevant data that focus on customer attributes. Managers need to realize that customers, in effect, "hire" products to do specific "jobs."...Why not put in tiny chunks of real fruit to add a dimension of unpredictability and anticipation--attacking the boredom factor. A thicker shake would last longer. A self-service shake machine that could be operated with a prepaid card would get customers in and out fast.

Improvements like this would succeed in building sales--but not by capturing milk shake sales from competing quick-service chains or by cannibalizing other products on its menu. Rather, the growth would come by taking business from products in other categories that customers sometimes employed, with limited satisfaction, to get their particular jobs done. And perhaps more important, the products would find new growth among "nonconsumers." Competing with nonconsumption often offers the biggest source of growth in a world of one-size-fits-all products. ...One option would be for RIM to believe its market is structured by product categories, as in: "We compete in handheld wireless devices." WRONG!!!!!!!!!!!!!...But what if RIM structured the segments of this market according to the jobs that people are trying to get done? Just from watching people who pull out their BlackBerrys, it seems to us that most of them are hiring it to help them be productive in small snippets of time that otherwise would be wasted, like reading e-mails while waiting in line at airports....Features that do not help customers do the job that they hire the BlackBerry for wouldn't be viewed as improvements at all. ...Brands are, at the beginning, hollow words into which marketers stuff meaning. If a brand's meaning is positioned on a job to be done, then when the job arises in a customer's life, he or she will remember the brand and hire the product. Customers pay significant premiums for brands that do a job well.
Clayton_Christensen  Michael_Raynor  Innosight  prepaid  innovation  market_segmentation  customer_experience  arms_race  branding  product_development  education  Colleges_&_Universities  Theodore_Levitt  disruption  new_products  customer_segmentation  observations  nonconsumption  hiring-a-product-to-do-a-specific-job  one-size-fits-all  BlackBerry 
september 2009 by jerryking

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