The Big Question
Many companies are increasingly finding that their existing product-driven businesses have difficulty growing and differentiating themselves from their competition. In addition, their quest to find new markets and new products to expand their portfolio is becoming more complex because of rates of innovation, speed of competitive follow, and confusion in incorporating newness and change into their existing and established organization.
Here is the big question: Which of the following is most important to focus resources on to better serve their existing customers and to find new customers and markets?
- Identifying and generating improvements to existing products
- Developing new products and offerings
- Reevaluating and accelerating their positioning and communications to selected markets
- Defining and commissioning new channels to reach the existing and redefined markets
- Reassessing and honing pricing strategy to capture real value added
The Good Marketer
The answer is all of the above. A good marketer recognizes that these are not independent efforts. Any work done on one requires work on all the others. Yes, focus intensity may be in one or two marketing arenas, but all must be assessed if success is to be achieved.
Improvements in existing products are most likely going to move the needle a small amount. New products alone are going to take time to cause change to take place in any existing market and a new market initiative is often difficult to penetrate. Channel modifications can create more confusion than expected. And the worst sin of all is to increase prices without increasing value.
Good marketers do not incrementalize. They understand the interdependence of all these actions. They especially do not commit the most grievous sin of simply raising prices because their bosses see that as the easiest fastest profit remedy. They begin with an intense assessment of the existing and potential markets.
The Key is Market Analytics
A market analytics study incorporates a comprehensive assessment and analysis of the critical components of your business interaction with a defined market. Obviously, the design is dependent on the nature of your market and the competitive environment. However, for most business to business markets, the study should be able to answer most or even all of these questions:
- How important are our product attributes to the market and how do the major competitors (including us) perform against those attributes?
- What benefits (outcomes) do the specifying customers in the market want to achieve? How do they perceive their primary suppliers performing relative to those outcomes?
- How can we distinguish between what customers say is important and how they actually behave vs. their stated importance?
- How do these attributes and outcomes vary by different segments of the market, or what segments are derived from different responses to attribute and outcome importance?
- How will price changes impact competitive share and how does that differ among the defined segments based on attribute and outcome importance?
- What is the right balance between price and share that maximizes our profits?
- How would customers value a new product concept that we are considering bringing to the market? What would they be willing to pay for the concept?
- How would customers value some new offering features we may bring to the market? How does that value differ across the customers?
- What new features would provide us with a “blue ocean” of opportunity?
- How do customers perceive our brand vs. competitive brands?
- What are the underlying structural components and attitudes of the market that define where we need to focus for future growth?
The answers to these questions enable businesses to answer the big question: “What is most important to focus resources on to better serve our existing customers and to find new customers and markets?”