1. Submitted By :- Ayush Arzare
Submitted To :- Dr. Rashmi farkiya
2. 2° C r e a t i n g N e w M a r k e t S p a c
e : :
Creating new market space is critical for smaller start-up
companies as well as the world’s largest companies.
Markets must be created and re-created to keep
sustainable, profitable economic growth and competitive
advantages.
Six Basic Approaches:
1: Across Substitute Industries
2: Across Strategic Groups Within Industries
3: Looking Across the Chain of Buyers
4: Looking Across Complementary Product and Service
Offerings
5: Looking Across Functional or Emotional Appeal to Buyers
6: Looking Across Time
Home Depot (hardware store for ordinary home
users, with expertise sales people).
3. 3° C r e a t i n g N e w M a r k e t S p a c
e : :
1Looking Across Substitute
Industries
Ask 4 basic questions
Reduce: What factors should be reduced well below the industry
standard?
Eliminate: What factors should be eliminated that the industry
has taken for granted?
Create: What factors should be created that the industry has never
offered?
Raise: What factors should be raised well beyond the industry
standard?
Home Depot (hardware store for ordinary home
users, with expertise sales people).
4. 4° C r e a t i n g N e w M a r k e t S p a c
e : :
2
Across Strategic Groups
Within Industries
This refers to a group of companies within an industry that pursue a
similar strategy.
Two dimensions for strategic groups:
Price
Performance
These two generally follow each other.
Polo Ralph Lauren – Trading both up and down:
haute couture & the classical lines.
5. 5° C r e a t i n g N e w M a r k e t S p a c
e : :
3
Looking Across the Chain of
Buyers
The target group is a chain of customers directly or indirectly involved in
the buying decision:
1) The purchasers
2) The users
3) The influencers
These groups may overlap, but often differ.
Challenging an industry’s conventional wisdom about which of these
groups to target may lead to the discovery of new market space and
thus create value.
Bloomberg (Finance) – Selling an easy-to-use,
broker-friendly system to traders (users), not IT
managers.
6. 6° C r e a t i n g N e w M a r k e t S p a c
e : :
4Looking Across
Complementary Product
and Service Offerings
Other products and services often affect the value of product and
services. Think about what happens before, during and after the
product is being used.
Book Superstores, adding
entertainment and help to find a book,
by staff with extensive knowledge
about the products… instead of
clerks…
7. 7° C r e a t i n g N e w M a r k e t S p a c
e : :
5
Looking Across Functional or
Emotional Appeal to Buyers
Functional vs. Emotional appeal could be challenged in order to create
value.
Often companies looking for just functionality tend to stuck with JUST
functionality.
The same is told for companies looking the “emotional value.”
Starbucks – The Coffee Bar: Selling coffee is
not only a product… is an experience.
Swatch – Turning budget watches into
fashion accessories.
The Body Shop – Stripping away emotional
appeal and saving costs.
8. 8° C r e a t i n g N e w M a r k e t S p a c
e : :
6
Looking Across Time
External trends affect businesses over time. Recognising these trends
and where they are heading can unlock innovation and create new
market space.
Enron (before they thought of a new trend in irregular
accounting practices) – Saw the logical conclusion in the
deregulation of the gas industry which enabled them to
buy where it was cheap and sell where it was expensive;
thus unlocking trapped value.
They later went on to innovate in accounting… but that is
another story.
9. 9° C r e a t i n g N e w M a r k e t S p a c
e : :
Our Example
Hence, using approach 1, 3, 4 & 6 Creating
new market space!
Google recognised the trend of the information-based
society and was able to withhold substitutes by creating a
new advertising model, focusing on users and
influencers, rather than purchasers (those buying
advertising space) first hand. They also recognised the
complementary value of information related to what is
being searched for by adding connected advertisements to
the search results.
