strategic market management

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48 Part Two Strategic Analysis Tlw athleti(: shoe illdustl)' segme llts illto the St'liOllS athletes (s mall ill J1umher bllt in/ - luelltd ), the IVcekcl1(1 w,lITiors , and the G1S1WI W(:'<lrers lIsin g athleti(: shoes for street wear_ Hccognizing that the cas11al wearer segment is K() percent of the market and does IIOt really IWl'd pcrformance , st'vcra l shoe finlls have emp loycd a sl -y le-Focllsecl strategy as all altl'nl,ltiv(' to the p(-' r!i)flllancc stratei--,')f adopted hy snch finns as Nih:_ Mu il iple Se g nll'nls ve l'sus a FoclIs Sla-ategy T\ v() disti nct scglllc'l1tal"ioll str' lt q.(i{'s arc possihk'_TIl(-' fir st [-OC11S(,S Oil a sillgle sl'gmcllt , w hi ch ca ll1 }(' 11111('h smaller thall til(-' market as a wboll-_ \Val-Mali , now the Ltrgl'st V_S_ rdail c r , starll'd hy l'o llcl'll tr atillg Oil cit ics wi th popl1latiolls lilld er 25,()(){) ill c1ewll C( ' lltral staU's , ,I Sq!;I1ll'lIt tol- ally Il cgl ect('d by its competitio11 , til(' large di sco lill t chaills_ This nlral gcograpllic I()C II S strah't;; was diwctl y wspo llsihlc li)r several sig llifi- ca ll t SeAs , ill(, h,dillg al l alld l"('spo1lSiv(' war('llOlise sllppl y S),sk lll , a low-cost , III ol"il'at('(1 \\'()I"kl() I-(,(" 1"(,Iati vely illC'XPl'lIsivl' retail s pace, and a 1( ', 111 alld m ('<111 , halld s- on Inallagcl1l('llt slyle_ V nioll Balik, (; ,tiili'r11ia's l'iglltll largest h' lIlk , 111akcs 110 cH()rt to servl' il1dividllals ,lIld tl1lls provides a S(' I'Vic(' opnatioll tailorl'd to IlIlsinl'ss aCCOllllts that is Ilion' CO llinlitl< 'c l alld CO lllpreh( ' 11 Sive th,1I1 those or its ('() Illp etitor s_ ' All all( ,rnativ(' til a 1()(,llsillg str<lteg), is to illvolvc 'lI,d tip lc SCgIl1C lltS_ C( ' lwr,,1 "Iotors prOl ides tl1<' ci;lSsic III tl1(' til(' fi nll positiollcd the Clwvrold lill- l)l- ic('- conscio ll s 1)1I ),c' rs, tlw Cadillac I()r til<' high ('Ild , <lnd til<-: Oldsll1ohiit- , POllliac, al1(l Bllic\< ror w(,II-ddi, l('d S('gll1<'lltS ill l)('tI-I'('(:' n_A gr'lIl1 i1ated potato com- p"n ), I,,\., developed dilTc rl ' llt str<l[-( 'gi es 1'01' r C';lc hill g f':Ist - f"ood cha in s, hospita ls a III I 11IIrsing hOIlH' S, alld schoo ls <llld collq.(l's_ III Illan\ ilHlll str i('s aggn'ssive I-irnls ;lIT Inovillg toward Illlll tip lt,-sCg lll l' lIt strat('gies_ CaIIIJlIll'11 SOlq), I-or exal11pit-, Illakes its ll<l cho ch('('s(' SOIIP spicil'r 1'01' cllstonH'rs ill T( 'xas alld C;,i1i[ ' ornia alld olll'r" a Crcole soup ror sOlltlll'r11 mark(-'ls and a ITd-I)(',ln smq) 1-01' Ili spanic mar-k('ts_ III New York , (;,1Illpl)('11 li st'S prolllO- tiolls linkillg SWanSOl1 I-!"Or.l 'll dillllers with til( ' Nt'w York Ciallh rootbali tc'alll , <I III I ill th( -' Si('IT,l N('I ' ada 1ll( lllIlt<li llS, sk ier s arc tr(',lt cd to hot S()l IP sa 'llpl t's_ l)(- ' vclopillg 11Illltipl(' strat (,gics is (:()s tl y <llld o[-tc'n nlll st 1)(' jllStil-i(,d by an (' llh ,lIlC(,d ,l ggn'gat(' impa('t. '1'11('1"(' ca ll Iw impor[" ,lllt s),\)('rgi('s Iw l"VC(' ll SC'g lll<-'llt ollnillgs_ For CX; lIllp k" ill tll( , alpilH' ski illdllstrv, tl,(, image dc vcloped hy lti g ll -pt-'r!C)l"T1I;111l'e sk is is ill1POlt,lllt to sal( ,s al- th(' rt'lTC 'a tiollal-ski . ('lld 01 - the illlSill css_ Thll s, ,l that is wc·,lk at tlw Ili g h c lHI willhavc dimc l,]t)' at the low cnd _COIlVl'rsely, a sllcct'ssflll high -e nd firm w ill wa nt to exploit !"llat Sllceess by haV ing l'lltries ill thc otlwr seglllt'llts_ A kl')' SIIC- n,ss rador ill the g(->lwral ,l viatio ll indll stry is a hroad prodnd lin t', ranging from fixc·d- gear, singl e-l' ngill t' pistoll aircraft to tnrhoprop plant's , I wcallse cllstOJllers t(,lld to trade IIp and wil l switch to ,1 diff erent finn if tilt' product lint' has major g; lp s_ CU STOMER MOTIVATIONS I\I -t(' r i(I('lliiCvillg ('llsl()III('I- \('g lll('llI s, III(' 11('\1 , 1( ' 1) is III "1111'.1,1"1 11"-11 IIltiltl:ilitll'\: \\'11;11 li,' s 1)('I,illrillll'il' 1"II 'r- I':I\(' ri('(""illliS') ,\,"II1t )\\ ,1"' '' .1 1, .1 1 tlil l, ,1'1 '" II Chapt er .:3 Extenwl a1ll1 Customer Ana.lysis 49 is he lpld to li st the segme nts and ll1oti vatioJl priorit ies or each, a\ shown ill Figure :3..5 for ,lir travele r s. Int ern et retaiJ e rs have that there are distinct shopper segme nts, and ('<lch has a v('r), ditlerellt set of' tirivillg moti v ations. ,I Newbie shoppers-need a simple in[e rhl ce , as wcll as a lot o/" hand-Ilolding and reaSSlll"111 Ct'. Reluctant shoppers - lIc'Cd i 111(lrInatioll , I' (' ;lSSII 1'<1 n ('(' , and ac"('c'ss to I iv(' cusl- ol1wr suppo rt. Frugal shoppers-l1t'(,d to Iw convillc t, d that tl1<' pric c is good alld they dOll't have to search (·Ist'whcn '_ Strategic shoppers-nl'cd ;lCCCSS to th e opiniolls or pcns or eXjlnts , ,Int! c hoic es in cO llfi g llrin g the protillctS tlll' V 1)11),- Enthusiastic shoppers-nl'l'd CO llllllllllitv tools to sitare tllcir l'nc('s , as well as t'llgagillg tools to vit'w tl1<' llH'rC!,;lll<lis(' ant! jlnso llali l'.l' t! ITeo Inn1(- '11 chi ti 0 n. '_ Convenience shoppers- (l ll c' largesl ,t; l"Ollp) wallt.' ellici( ' nt '''\li gation,,, lot of- illl-orinat-ion rrolll C llst (lIl1ns ant! (- '\pcrts , alIt! sl ljwri()r CIlSt(JIIH'I- se lvin' , SO\li(-' )lloti vatiol1s will he lp to ddin(' st ra tegy A tmck , I()!" exampk , Inight Iw tI('.,iglled ,lilt! positioll('(1 wit h respect to power. BeI(»'( ' 111<lkillg sllch .1 strat<-gic ('0 111 - 1"illl1cnt , it is crllcial to kl10w whe n' powl'r fits in tlw IIHJtivatioll set. Otll<'r Iliotiv<l- IllIns ma y not defint' a strategy or dilferentiate a 1 1i1Si lw<;s , hI 11-n' plTSl'llt ,I dinl<'nsioll Ii II' witich <It!(- '<jllak pe d(Jrll1;tnu· 11111St Ilt' ol)tailll'd or tlie hat-tl (' will 1)(' lost. II' till' I"i",(' l11otivatioJl li)r 1)l1),('rs or gOllrJIld froi'.l'll-I()()(1 tiilllH'I-S is t,IS["(' , a vial)le firln ""I.,t I ll' ahle to ck liv er at least I-astc' _ I ) el ermjnjng Motjvations I"ig llrt , :3J) SlJggt::sts , COllSllme r 1l1otivatioJl allal ys is starts wit h thl' task or iti Cl1til)'- ill , \!, '1lOtivations ["or a give n segme nt. Althollgh a grollp of nlallagl'rs (',Ill id(,lltil), Illuli- 1<lli()II.', a mort:: va li d list is Ilsllall y oi>tailwti , getting Ciistollll'r\ to (lis(,IJss tile I !I l1dlll't or in a systemat ic way- \Vh y is it heing lIsecV \V!tat is titt' \\ -ilat is as.'ocial"ed w il -h a good or bad ll se !-"()r a Illoti v;ttiOfl slich as car ',. Ire-Iv, Inight he asked why sa rety is impoltallL Sncil proi)(' s might r('s ilit III IIII' ident-in catioll of more basic moti ves, such <IS thl' d('silT to [-('c'l Uillil and S( - 'CI11T 1 111 1\''- tl,a,l ,1I1 '( ioIIS_ ,\f" ,t!.IIH'lIt '\ lo li\';llio " l Id I' .. il Ii ' "'''' 1I"li:,1 . I( -' "-,, It·,- (-Il l) "' I)i",,1 \1- 1 ",<1,11,,\ , (';ISI -Io- u s(' dilvorts , I'rC«'H'lIt-fln'r Ilrt >, p,r; \lll" : 11111 ..... " ·\i l·(· \ ,1(':11 i( 1111 '1 S I 't in ' !I - ,I "d .Ie' ',( ·111 ·tllIl,,,, :;,;' ( " I',IIHl l ('1 \ 1 ,11 1' 11 11-' . f Itll l \ 11 ' 1' ,1 \1 ' \"1"

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48PartTwoStrategicAnalysis Tlw athl eti(: shoe illdustl)' segmellts illto the St'liOllS athletes(small ill J1umherbllt in/-luelltd),the IVcekcl1(1 w,lITiors, and the G1S1WIW(:'('C:lIISC'()I ' lhc ' il'n 'S() III'('C'.':llIdIIloli \': llioli . Disl'upti v('ilillova tioll s,in(,OIlIT;( ' 11[Fonv' "I , ,llIdcOlllpetellCiesandth'lt providefewsynergies. \1I('asttlliTeplwnoJll enaC\" 1' (011);11' a str.ploiting('\cesscapacityistheLos Allgell's,sports('lllpirt'01'.Jt:ny1311'-;,S, 13IIS,SOWIl.SIClllrsportsteallls,includingthe 1,ake'!",shClsh,tlJa11teanlandtIll'Killgshmley tealll,all0[' whichplayinhisJ7,.SOOs('atF01"l111i,llldap[l('arOilIlisPrime'Ti('kctrt-'giollalcahlechann('l,whichrcaclw,s II(',lrlv16 Illillioll110111('S,TIl('tl'alll,eralionsthatcal1addcapacity jllStbyaddillg ,I 1>lllt!)llto ;lCCCSSanotl1 Mol'(' di v(' rsiricdFinns I, 'lit!toslIlfer ('ronlsprcadill gtheir ],( ' SOIll'C('Sandclr1tur('toobroadl )"resultingill a I I " III('(,dahilityto g,linelT-ici(' nci ("'salldIllarkl'l leadl'l'ship,Morei'ocll sedrirl11s,COII"' I SI,l v,mayhndit diiTiculttolli anagemarketdynall1i csbecausl'or whatisknll cd ', I ral('gicstl1hhol'lllless"inChaptnH,Inane;(amplcof 11loderakdi ver sifi cation, 111 i1llglr,CincinnatiIkll kVl'i'ag(>ditslocal capahiliht 'sduringthc I10 cn"atl' a significant businl'ss 11)' providiil g call-c(, nt f-,],alld hack-olri('1'sClv ices I" oili erCOll1pani(>s,1 2 As ar('s ldt ,thl' l 'OI\lI)'