actionable market segmentation v1.4.ppt - … market segmentation – how to assess market ......

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John Brian SutterMIDIOR ConsultingJuly 15, 2010Actionable Market Segmentation

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© 2010 MIDIOR Consulting All Rights Reserved© 2010 MIDIOR Consulting All Rights Reserved

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Actionable Market SegmentationJohn Brian SutterMIDIOR ConsultingJuly 15, 2010

blog.midior.com

www.midior.com

Follow us on Twitter: @midiorite 2


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Actionable Market SegmentationJohn Brian SutterMIDIOR ConsultingJuly 15, 2010

MIDIOR Overview

Our premise is simple - inspire excellence in developing products and leveraging technology.

MIDIOR is a one of a kind firm, uniquely qualified to help our clients reach new levels of innovation and efficiency. We are technologists with a passion for delivering business results. We are innovators with our eyes on process for sustainable and repeatable results. We are hard to define - and yet we fit right in the middle of the solution to our client's dilemmas - right there at the intersection of technology and business. Every industry, from manufacturing to financial services to education, is entirely dependent on building competencies in the acquisition, development and deployment of technology. It's as fundamental as knowing how to work the phones - yet it is a complex subject, where success is dependent on the right combination of skills and expertise.

At MIDIOR, we help our clients improve profitability and growth by increasing their "return on technology." In particular, we focus on improving the relevance and leverage of our clients' product and technology portfolios against business objectives. Whether we are working with a software vendor hoping to accelerate their product development cycle, a financial services firm looking to achieve an order of magnitude cost reduction, a manufacturer of industrial supplies trying to define a product roadmap, or a retailer hoping to double throughput at point of sale, our role is clear: leave behind a client who is more adept at taking advantage of technology.

Follow us on Twitter: @midiorite 3


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Actionable Market Segmentation – how to assess market opportunity for new products and services and turn that analysis into actionable steps that will increase market share and win sales.


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Theme: The collection of key measures will help you make better product decisions. (or at least build a case for product investments and marketing programs)

Goal: increase market share and win sales.


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What is Actionable about Market Segmentation?


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‣ Key Buying Factors

‣ Need States

‣ Usage/Purchase Occasions

‣ Occasions

‣ Lifestyles

‣ Psychographics

‣ Demographics

‣ Geo-graphics

‣ Behaviors

Segments = Data (about customers)


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‣ One to One Marketing

‣ Market of One

‣ Usage/Purchase History

‣ Loyalty Programs

‣ Review and Attitudes

Market Segmentation

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9Segmentation can be very different depending on your product, your customer, and the marketplace.


10Managing the Product Successfully means Measuring Product Success Factors

WHERE IS THE OPPORTUNITY FOR CUSTOMER SUCCESS?

TRANSLATION: WHERE IS THE REVENUE?

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Actionable Market Segmentation

ASSESSMENT SALES / MARKETING ENABLEMENT THE SCOREBOARD

MARKET OPPORTUNITY ANALYSIS

1 - A Data Framework to measure opportunity by Segment and an actionable dimension

2 - Prioritize investments in Product and Marketing

3 - The right framework facilitates product decisions on a ongoing basis

KEEP SCORE AND COMMUNICATE PROGRESS

★Review Action Plans and Programs★Communicate Progress★Schedule Updates to the Market Analysis★Product Management Dashboards

EXECUTE ACTION PLANS

Programs and tactics drive sales activities supported by specific targets of opportunity: The right Customer, The right Product Mix, The right messages

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Do product managers value market opportunity analysis?


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MIDIOR Product Management Survey for 2010

Market research and competitive analysis - Part of the job description?

Amount of time spent on Market research and competitive analysis

(where this is part of the job description)


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Market Opportunity Study

FROM THE MIDIOR PLAYBOOK

Uncover the current state of your product(s). Identify and qualify Competitive Threats Establish a framework for monitoring success in the marketplace Create Business Scorecards for sharing information within your organization Recommends the best mix of investment and resources to generate revenue and opportunity in the right markets.


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Market Opportunity Study getting to The Money Slide15


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Where in the world will customers buy your product and services?

What if you could answer that question with fact based information?


17It’s all about leveraging data

Collect Key Metrics at the Entity Level (Customer) Interview Key Constituents & Stake Holders



Define the Industry Segments & ICPBand data attributes for entities into groups

Uncover the current state of your product(s). Identify and qualify Competitive Threats



Hoovers | OneSourceSFA / CRM | Industry Websites | Google

Product Strengths / WeaknessesMarketplace FactorsCustomer GoalsNew Requirements / New OpportunitiesCompetitor Awareness + Strengths / Weaknesses© 2010 MIDIOR Consulting All

Rights Reserved© 2010 MIDIOR Consulting All Rights Reserved

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Market Opportunity Workstreams

DEFINE SEGMENTATION FRAMEWORK

WHAT IS THE IDEALCUSTOMER PROFILE DEFINE THE SEGMENTS Framework for Roll up

VOICE OF THE CUSTOMER RELATIONSHIP MGRInterviews (40)

CLIENT INTERVIEWSInterviews (40)

Qualitative Data

CLIENT AND PROSPECT ATTRIBUTES

CRM Extract BUSINESS ENTITY Extract(Hoovers, OneSource)

Quantitative Data

VOICE OF THE MARKET SECONDARY RESEARCH(Analysts)

PRIMARY RESEARCH(Interview Competitors)(Product Evaluations)

Market Data

Other Data for 360 Analysis: Product Costs, Operations Measures, Enhancements, Sales Operations, etc.


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Market Opportunity Framework

• Step 1 Define the Segments (Industry)

BANKS (Large)BANKS (Central Banks)

COLLECTIVE FUNDS

INSURANCE COMPANIES

NON-PROFIT / ENDOWMENTS

PENSION FUNDS (Corp)PENSION FUNDS (Public)

SOVEREIGN WEALTH FUNDS


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• Step 2 Define the Geographies of interest for the Industry Segments

NORTH AMERICAUNITED STATESCANADA

EMEAUNITED KINGDOMSCANDINAVIA AFRICAWESTERN EUROPEIRELANDEASTERN EUROPEMIDDLE EAST

ASIA-PAC CHINASINGAPOREHONG KONGEMERGING ASIA1

AUSTRALIANEW ZEALANDJAPAN

1 NOTE: EMERGING ASIA = Malaysia, Vietnam, Thailand, Korea, Kazakhstan


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• Step 3 Define the measures that quantify revenue opportunity

ASSETS UNDER MANAGEMENT IN USD ($B)BASED ON ASSETS UNDER MANAGEMENT > APPLY BASIS POINTS FORMULA TO CALCULATE REVENUE POTENTIAL

OTHER MEASURES / FORMULASCOMPANY SALES REVENUEMARKET VALUEPROFITSGROWTHNUMBER OF EMPLOYEESNUMBER OF LOCATIONS


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• Step 4 Determine your current product’s relative strengths and weaknesses in the geographies of interest

WHAT DO CUSTOMERS SAY?INTERVIEW CUSTOMERS

WHAT DO RELATIONSHIP MANAGERS SAY?WHAT’S HAPPENING ON THE FRONT LINE?SALES WIN / LOSS REPORTS

WHAT DO YOUR OPERATIONS / SUPPORT PEOPLE SAY?SUPPORT REQUESTS

WHAT DO THE ANALYSTS SAY?INDUSTRY REPORTS

CONSULTANT’S ASSESSMENTPRODUCT WEBPAGES / COMPETITOR WEBPAGESINDUSTRY ARTICLESPRESS RELEASES


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• Step 5 Organize and Group Geographies by Markets. Score each Geography by Product Readiness Scores

AT A HIGH LEVEL, PATTERNS CAN EMERGE THAT ARE ACTIONABLEPRODUCT READINESS SCORES WITHIN MARKETS OF OPPORTUNITY


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Now that we know the Size of Each Market, let’s calculate what clients will pay for the product and determine the real market opportunity. © 2010 MIDIOR Consulting All

Rights Reserved© 2010 MIDIOR Consulting All Rights Reserved

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Group Category Competitor A Competitor B Competitor CBusiness Overview Client Service & Relationship Model

Differences between full service and custody only clients

Liability TransfersOperating ModelProducts/Services

Competitive Landscape Competitive standing in each segmentCompetitive advantage in each segmentCompetitive deficiency in each segment

Innovation New Market Opportunities (upcoming legislation, geographical differences, segment differences…)

Industry/Client TrendsNew Product OpportunitiesProduct Differentiators for full service vs. custody only

Product Perception Internal ComplaintsClient ComplaintsProduct Strengths Product Gaps/WeaknessesSalesRelationship management and client serviceOperations

Strategy Pricing Strategy (bundled, lowest price, charge back…)

Client Segmentation

Competition Tab


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“We would like to see packaged products so that ‘Security Services’ is one stop shopping.”

FRANKCURRENT CLIENT


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Market Opportunity Analysis

Data and Information about each segment

All new opportunities for your product

Your existing clients

Your competitor’s existing clientsSpecific Insight on which product + marketing needs

fit the right segment for driving specific revenue


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Sales Enablement > Ideal Customer Profile

• SELL THIS

Revenue > 200 M

Employees > 1000 Industry: Financial Services High Tech Healthcare

NOT THIS

> opportunities for channel partners

US Government Agencies

Intl Government Agencies Education

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Sales Enablement

• Key Selling messages via BrainShark

• The elevator pitch

• Success Stories via Enterprise Social Media

• Export lists of ICP profiles

• Standard Product Manage Best Practices

• Work with Marketing on Action Plans


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34Keep Score using a Dashboard that leverages the data you collect


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The Product Manager’s Dashboard

• Create Product Manager’s Dashboard with the data from Market Opportunity Data using a graphics tool (Swiff Charts or Adobe Flash)


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Lessons learned


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“Who is our top competitor? DB2 for AS/400”


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Who remembers OS/2?

“I wouldn't want to be in your shoes. I wouldn't want to have to compete with the IBM company.”

Jim Cannavino, head of IBM's personal-computer business

1989To : Bill Gates, Chairman of Microsoft Corp.


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• Did you know: OS/2 was adopted widely in the financial services sector early on because of its reputation for dependability. And banks are traditionally squeamish about moving off of any system because of concerns about losing customer data.

•"It's very reliable, and you want it to be reliable and stable. OS/2 is doing what we want," said Ron Ferri, a technology relationship consultant at FleetBoston Financial Corp. "You could run with that for a while, until vendors moved off it.“

• ComputerWorld Aug 11, 2003

Who remembers OS/2?


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Study the Market by creating a Framework for the data and build a practice of collecting feedback.


★Keeping Score using tools that leverage market opportunity data can have a very positive effect on the entire team. It creates enthusiasm and encourages focus for meeting sales goals.


In addition to standard Product Marketing practices, help direct the Sales Team with qualified lists and tools.


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Thank youJohn Brian SutterMIDIOR ConsultingJuly 15, 2010

Follow us on Twitter: @midiorite

[email protected]

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actionable market segmentation v1.4.ppt - … market segmentation – how to assess market ......

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