The Manager's View provides solutions and advice based on management and marketing principles that are used by GWR Research (www.gwrresearch.com). Many of the posts are related to or are taken from the author's books "The Manager's Guide to Building a Successful Business" and "Developing Successful Marketing Strategies". More information on the books is available at Amazon.com, BarnesandNoble.com or Businessexpertpress.com
How Can You make the Competition Irrelevant? “Hit ‘em where they ain’t.”
I was recently asked to write a blog on Blue Ocean
Strategies that was introduced by +W. Chan Kim and +Renee Mauborgne in their
book Blue Ocean Strategy.
Everyone should read the book if they are looking for ways to
grow their business by creating uncontested market spaces. The book is an
excellent read and gives many compelling examples.
If I were to give a summary of the book it would be by using
a quote by Wee Willie Keeler, a great baseball hitter in the late 1800s and
early 1900s, who said, “I hit ‘em where they ain’t”.
At 5’4” and 140 lbs., Willie was a batting champion and is
in the Baseball Hall of Fame.
For businesses, the Blue
Ocean Strategy is a study on building a strategy for any business to “hit ‘em
where the competitors ain’t”. “Blue Oceans” are areas where there is little
competition from rivals. “Red Oceans” are where rivals are congregated,
fighting for customers using similar business approaches.
A place to begin a “Blue Ocean” strategy project is with the
Strategy Canvas. This canvas depicts how players in an industry set their
strategies on multiple strategy dimensions.As you can see in the example below it shows how Southwest
Airlines strategy differs from the other airlines. This difference has led to
Southwest’s success in an industry full of failures and troubled airlines.
Blue Ocean Strategy Canvas
This is an excellent starting point for any company wishing
to determine where to move strategically within an industry to find blue ocean
Once a business has determined areas that can be exploited
to create a “blue ocean” the book provides a well-constructed approach to
developing a “blue ocean” strategy and for dealing with hurdles that will stand
in your way.
When introducing a new product or service to the market a key, and often critical, consideration is the price for this offering. I have seen folks simply take the cost of production and use a percent mark up as a pricing model. This is the simplest model and it provides a good example for the need to consider other pricing model options. Here are 10 things to consider before setting a price for your product or service: · Mark up Based on Cost Vs Retail . In the opening paragraph I gave the example of a model being used that marked up a product by a percent over the cost. The cost used here is generally direct cost or labor and materials. If someone wants a 30% of the asking price to be the mark up, then using 30% of cost won’t provide the desired outcome. Simply put, it is the wrong math. If something costs $1 to make and it is marked up by 30% for a selling price of $1.30 then the profit of based on the asking price is 23.07%. To arrive at
Here is the third example of developing a marketing strategy project for a new product. This is a fictional company developed by a team of MBA students in my marketing strategy course at the University of Houston C.T. Bauer College of Business. Executive Summary Avenir is a forward thinking and progressive technology company seeking to positively impact the lives of our customers, collaborators, and shareholders through the creation of new technology. We were established in 2001 and are proud to employ 211 hardworking individuals at our Houston, TX headquarters. Avenir designs, markets and licenses the K-1 battery, a new kinetic powered battery that will enhance cellular telephone battery life. The K-1 battery will alleviate the need to constantly charge cellular phone batteries through electronic devices. Our new battery offers a significant leap forward in the world of portable electronic power to the cellular customer. Our collaborators will se
Here are some more thoughts on why newspapers may still be a wise investment and how they may find ways to develop a stable of print and digital products that complement each other. Virtually all newspapers have websites that look good and have great functionality. So why aren't they all producing acceptable amounts of profit? The question probably should be asked differently, "What do consumers and advertisers expect from newspapers?" Then ask, "What do they expect from the Internet?" The answers are different but there is overlap. The area of overlap is the area of opportunity for creating a business that is needed by consumers and advertisers and capable of creating value that translates into profits. To determine the real value of the website it is useful to measure the total advertiser dollars spent on a website only ad buy versus those being bundled with a newspaper or distribution ad buy. These stand-alone purchases might give so