Developing a Growth Strategy for Situational Markets - Article
I’m happy to announce that the 2024 spring issue of Strategy Magazine is focused on situational markets, with a lead article by yours truly! The title is “Developing a Growth Strategy for Situational Markets.” The editor at Strategy Magazine is a stickler for precision of thought. It was a great experience working with him. Here’s the magazine cover.
Below I share snippets from the article which you can also find on the Stone Mantel website.
The Problem
“The way that strategists think about their customer markets is based on the outdated idea that each person represents a unit within a market. Today, many companies still use terms like ‘mass market’, or ‘all the people are customers’ strategy, and ‘segmentation’ strategies, which means ‘only certain types of people’ are our customers. When companies define a ‘market’ as a certain number or type of customer, they put artificial constraints on their solutions, with the most glaring being that certain solutions are only for certain people. These constraints hinder innovation and limit growth.”
The Definition
“A situation is a set of circumstances, or a moment in time in which an individual, has a need. Needs that arise in particular situations are always the same, and they can be anticipated and designed for. The most lucrative situational needs to solve are common, frequently occurring situations that many people experience.”
The Methodology
“Developing a situational market strategy involves three steps. The first step, Assess, entails fully evaluating your data and insights by asking questions such as “Do you have the tools to evaluate and prioritize different situations that people find themselves in?” Understanding the landscape is crucial before starting the next step. The second step, Discover, involves embarking on a journey to discover new ways to address the situations that are important to your customers. This journey involves engaging directly with customers to gain valuable perspectives. Finally, Define, necessitates articulating a clear strategy that bridges the gap between your capabilities and your customer’s situational needs as well as defining actionable steps and demonstrating how your offerings meet their needs. This step ensures that your market strategy is tailored to meet the specific demands of situational markets.”
The Case Example
“To illustrate the three-step approach to crafting a market strategy for situational markets, let’s look at a renowned anecdote involving Clayton Christensen and a certain restaurant chain. For years, Christensen told the story of a restaurant chain seeking his counsel on growth. Through firsthand observations, he gained valuable insight by asking an unconventional question: “What did you hire this product to do?” Focusing solely on milkshakes, he learned that the motivation for buying a milkshake varied between morning and afternoon, constituting two distinct “jobs to be done” based on the situational context.”
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