This is adapted from http://www.pragmaticmarketing.com/pragmatic-marketing-framework The “real world” process is obviously less linear and more on-going …. Every one of the above processes can be further studied by attaching analysis tools to them, but the key is to first find out where the gaps, problems, missed opportunities exist. Consider: What missing, what OK to miss? Market Analysis (Where Going? Why Successful? How Get There?) Distinctive Competence / Competitive Analysis: Why successful there? Market Research/Market Problems: Where Market and Competitive Analysis: Clients, Industry Experts, Internet Employ: Porter’s Forces, Blue Ocean Strategy, Other Frameworks Technology Assessment: How Quantitative Analysis Before and After Launch: Market Sizing: Market Segments? After Launch: Product Performance / Win-Loss Analysis: Feedback? Against Metrics? Internal Impact? Product Strategy: Business Case: include Buy, Build, Partner Pricing: Its own field of study Product Portfolio: Consider portfolio – which do in biz case and is required in most non-startups Innovation: Competence, Analysis, BUT CREATIVITY Product Planning Positioning: in terms of clients Sales Process: repeatable , depending on target market – per lecture 6 MRD: as discussed Product Roadmap: part of vision and selling process … next few quarters … User Personas / Use Scenarios: Starting Design Release Milestones: approx order if Agile Program Strategy (Marketing Strategy) Marketing Plan: Will Discuss Customer Acquisition / Retention: Advertising, etc. ; but also how to retain Launch Plan: Much of what remains in matrix, initial marketing plan (collateral, training, press releases, train support, early customers) Buyer Personas / Success Stories: Very helpful for sales … Emsense .. Went to raise $ based on a Coke Success Story Thought Leaders: Become and represent … Lead Generation: Help Sales with …. Sales Readiness: Channel Training: How training sales Collateral and Sales Tools: What materials they need White Papers: including white papers Competitive Write-Up: helpful… but don’t give to clients Channel Support: Presentation and Demos “Special Calls” – Product Managers can becomes Super Sales Engineers Event Support Answer Desk – and addl support
A classic example of a well-executed defensive block using Competitive Intelligence was that of Johnson & Johnson when Bristol-Meyers decided to launch Datril to compete directly with Johnson & Johnson&apos;s successful Tylenol brand. Datril was to be priced 35% lower than Tylenol.Johnson & Johnson learned of Datril before its launch, and informed Bristol-Meyers that it was cutting the price of Tylenol to match that of Datril. Johnson & Johnson even extended credits to its distribution channels to make the price cut effective immediately. This move was intended to prevent Bristol-Meyers from advertising Datril as a lower-priced alternative to Tylenol. However, Bristol-Meyers responded by accelerating the launch of the television advertising campaign. Finally, Johnson & Johnson countered by convincing the television networks not to run the Datril ads since they no longer could truthfully claim that Datril was priced lower than Tylenol. Johnson & Johnson&apos;s efforts were successful and Datril achieved less than a 1% market share. Tylenol sales soared on the publicity and lower prices.
Applying Innovation Intelligence for Market Segmentation and Targeting
Applying Innovation Intelligence for Market
Segmentation and Targeting
Business Forecasting 2014 – Predictive Intelligence Summit
San Francisco USA
Tuesday 19 August 2014
Founder & Chairman, Aurora WDC
Managing Director, Center for Organizational Reconnaissance
Intelligence Has Always Been About Removing Illusions To
What Business are We in and Where are New Opportunities for
How do we structure and align those business units to most
effectively compete for and win Market Share?
Which customers are available to us and how can we convince
them to select us over any and all functional equivalents?
Intelligence has Focused on Decisively Minimizing Threats &
Minimizing Competitive Threats
Understanding Threats to Current Business Status Quo:
Competitors, Legislation, Technology Shifts, Obsolescence,
Substitutes, Customers Backwards Integrating, Vendors
Forwards Integrating, etc.
Maximizing Market Opportunities
Identifying New Sales, Revenue and Profit Centers
Develop New, Innovative Products & Services
Benchmarking Cost Reduction and Efficiencies from Direct Rivals
& Best-of-Breed non-competitors
Three Key Business Trends Driving Business Evolution
Human Capital & Enterprise Collaboration
Everyone in the Firm becomes a Virtual Member of the
Intelligence Apparatus, Better Engagement by Rank &
File, Shared Visibility of Issues & Actions
Corporate Governance & Risk Oversight
Board-level Priority Ensuring Reliability of Management’s
Earnings Forecast & Assessing Risks to Status Quo
Business Model Disruption & Value Innovation
Predicting the Outcome of Competitive Battles by
Anticipating Changes in Product/Strategy Dynamics
Principles of Defensive Warfare
Only the market leader should
consider playing defense.
The best defensive strategy is the
courage to attack yourself.
Strong competitive moves should
always be blocked.
Principles of Offensive Warfare
The main consideration is the
strength of the leader's position.
Find a weakness in the leader's
strength and attack at that point.
Launch the attack on as narrow a
front as possible.
Principles of Flanking Warfare
A good flanking move must be made
into an uncontested area.
Tactical surprise ought to be an
element of the plan.
The pursuit is just as critical as the
Principles of Guerrilla Warfare
Find a segment of the market small
enough to defend.
No matter how successful you
become, never act like the leader.
Be prepared to bug out at a
-- Jack Trout
• Finding market small
enough to defend
• Prepared to bug out at
• Moving into
• Element of surprise
No 2 or No 3
• Avoiding leader’s
• Attacking leader’s
• Attacking themselves
with new ideas
• Blocking competitive
Marketing WarfareMarketing Warfare
Managers caught in this kind of competition almost
universally say they dislike it and wish they could find
a better alternative. They often know instinctively
that innovation is the only way they can break free
from the pack. But they simply don’t know where to
Chan Kim and Renee Mauborgne
Competing head-to-head can be cutthroat
especially when markets are flat or growing
Business model How you make money
Networks and Alliances How you join forces with other companies for mutual
Enabling process How you support the company's core processes and
Core processes How you create and add value to your offerings
Product performance How you design your core offerings
Product system How you link and/or provide a platform for multiple
Service How you provide value to customers and consumers
beyond and around your products
Channel How you get your offerings to market
Brand How you communicate your offerings
Customer experience How your customers feel when they interact with your
company and its offerings
Description of type
10 Types of Innovation
Knowing Why They Buy
“Companies may know a
good deal about their
customers. They know
nothing, as a rule, about their
non-customers -- the people
who should be their
customers but buy from
someone else. Why do they
do that? And yet it is the non-
customer where important
changes always start first.”
Look Beyond the Current Business
Success Breeds Complacency
“It is a classic conundrum for business titans: How much
money and attention should be focused on a new, but
growing, operation that is far less profitable than the core
- Prof. Clayton Christensen, The Innovator's Dilemma
Customers “Hire” Products to
Do “Jobs” for Them
Concentrate Less on
What Customers “Want” and
More on What Customers “Need”
Value Chain Evolution Theory
• Disruptive Business Models: Vertically Integrating VC to Improve
What’s “Not Good Enough” in the company’s products and services
judged by customers.
• Performance Defining Subsystems: Companies must control all
those activities and combinations of activities in the value chain
that drive the product performance characteristics that matter
most to customers.
• Specialists will seek to control performance drivers based on
asymmetric differences in Motivation and Skills around a modular
interface in the VC. (Sword & Shield)
Disruptive Innovation Theory
Better Products Brought to
Target Overshot Customers with a
Lower Cost Business Model
Compete Against Nonconsumption
Nonconsumers or Nonconsuming Contexts
Customer Demand & Signals of Change
1. Non-Market Contexts: External Forces (Government, Economics,
etc.) Increasing or Decreasing Barriers to Innovation
2. Undershot Consumers: Opportunities for Up-Market Sustaining
3. Overshot Consumers: Opportunities for Low-End Disruption, Shifting
Profits by Specialist Displacements (Modularity) and the Emergence
4. Non-Consumers: Opportunities for New Market Disruptive Growth
Established Companies almost always
Lose to Disruptive Innovators
Performance-Driven Organizational Reconnaissance Engages the
Workforce in Collaborative Intelligence and Analytics to Anticipate and
Act on Industry Change to Ensure Good Governance for Stakeholders
Likely Outcome of
Intelligence Should Concentrate on
Five Domains of Business Problem Solving
Ensuring against risk to the core business is critical to making
sure there is time for investments in new growth to start
paying off. Maintaining a positive status quo by protecting the
core is the chief role for managers in every business, with one
caveat: good businesses can often be the foremost enemy of
Cannibalization of a company’s current market share should
not exclude innovative ideas that might be foreign to the
corporate immune system.
The ruthless cutting away of unnecessary costs in the value
chain is essential for a new market innovation strategy to work.
Create or build up that which is not yet good enough and
diminish or destroy that which is unnecessary.
Most of the unnecessary elements in the incumbent value
chain have long-since outlived their usefulness or were never
very important to customers in the first place.
Companies become too dependent on their best customers’
input for signals about how they should innovate, but new
forms of competition usually present themselves at the current
The day your customers begin complaining about how
complicated or expensive or difficult your product is, you
should ask, “why was it good enough for them yesterday” and
who has offered an alternative?
Traditional market segmentation based on demographic,
geographic or sociographic data are fleeting at best and illusory
at worst and many decisions have been based on flawed
definitions of the fastest growing markets.
Defining the market by the “jobs” customers wish to
accomplish is more helpful in defining fast growing target
markets. Focus groups are often the worst mechanism of
Differentiation is mandatory for all organizations to master and
new market or “novel” solutions to customer problems are often
ecosystems of providers working together to produce sought-
Companies must build a business model designed to test
breakthroughs in the market more regularly but kill off those
that do not work early on, so support and development
resources can be allocated to those that do.
STEEP (Macro Environmental) Analysis
Strategic analysis begins with environmental market scanning and impact
assessment. STEEP covers this broadest “high-altitude” point of view of the
market environment, covering five aspects impacting competitiveness:
1. Social: values, lifestyles, ethical norms, literacy, cultural attitudes,
customs, beliefs, education
2. Technological: digital communications, biotech, chemicals, energy and
3. Economic: balance of payments, inflation, fiscal/monetary policy,
spending, income growth
4. Ecological: climate change, resource depletion, sustainable development,
5. Political: regulation, legislation, lobbying, political party platforms, local,
regional and national
Level of CI Involvement in M&AStage
ID Evaluate Due Consum-
Criteria Targets Analyze Diligence Recommend Negotiation mation
Level of CI
Seven Steps to Effective Competitive Benchmarking
1. Determine functional areas within your operation to be benchmarked. This is
likely to be those areas that will benefit most from the benchmarking process,
based upon the cost, importance and potential of changes following the study.
2. Identify the key factors and variables with which to measure those functions.
Two general forms – wherewithal/resources and goals/strategy.
3. Select the best-in-class companies for each area to be benchmarked -- those
companies that perform each function at the lowest cost, with the highest
degree of customer satisfaction, etc. The companies you select will be those
that do whatever you’re measuring better than you do and/or are ones you
wish to emulate or copy.
4. Measure performance of the comparison companies for each benchmark
5. Measure your own performance for each variable and begin comparing the
results in an "apples-to-apples" format to determine the gap between your firm
and the best-in-class examples.
6. Specify programs and actions to meet and surpass the competition based on
a plan developed to enhance those areas that show potential for compliment.
7. Implement your improvement program by setting specific improvement targets
and deadlines, and by developing a monitoring process to review and update
the analysis over time. This will also form the basis for ongoing monitoring,
revision and recalibration of measurements in future benchmarking studies.
Growth Vector Analysis
Growth Vector Analysis (GVA) reviews the different product alternatives available to
the firm in relation to its market options, not already being pursued by competitors.
Four complimentary characteristics are used for defining common threads of
Product-Market Scope specifies particular industries to which a firm confines its position.
Growth Vector indicates the direction a firm is moving relative to current product-market posture
(market penetration, market development, product development and diversification).
Competitive Advantage defined as particular properties of individual product markets conveying a
strong market position.
Synergy is the combined effect on the firm’s resources that is greater than the sum of its parts.
Present Products Improved Products New Products
Existing Market Market Penetration Product Extension Product Development
Market Extension Market Segmentation / Product
Product Development / Market
New Market Market Development Product/Service Extension &
Feel free to ask for help:
Phone: +1 (608) 630-4242
Web: http://IntelCollab.com & http://AuroraWDC.com
Leadership to Act is
Based on Confidence
Intelligence Combats the Paralysis that