Wednesday, November 11, 2015

Knowing your market

            The common theme around the readings this week was the ever-changing nature of markets and how proper identification of one's place in said market is crucial. What Happens Next?, Ten IT-enabled Business Trends for the Decade Ahead and Global Trends 2030 provide a forecast for what is to come while Cola Wars breaks down how two giants utilized various franchising and product offerings in order to secure a larger market segment than the other in strategizing that read like a Harvard Business Review case homage to Spy vs Spy. Competitor Analysis and Porter’s Five Competitive Forces on the other hand took the theme of Cola Wars and analyzed the forces and strategies at work. The Cola Wars case began as a case of the threat of new entry as trademark infringement lawsuits were seen as a way to limit the threat from new entrants before settling into a rivalry between existing competitors with Coke and Pepsi duking it out. In the 2000s the Cola Wars would move to see the two companies changing strategy to diminish the Threat of Substitutes that comes from non-carbonated soft drinks, absorbing companies focusing on tea, bottled water and energy drinks.

            For companies to be successful they need to have not just a proper understanding of their product, but also of the overall market, their competitors and possible angles to capture more of the market. Companies need to move to have a strategy and structure that doesn’t follow pre-conceived norms for the sake of doing what other companies are doing. They need to realize what works, what doesn’t and create a process that is a reflection of them while also realizing these rules might not apply for all companies. A different company might have a focus on a different market segment or image as a retailer, opting for the air of a high-end provider of a product or the most economical option for another. This is especially true of companies looking to capture a large segment of emerging markets in countries like India. GE’s decision to emphasize their operations in healthcare demonstrates this strategy in practice. In order to develop for this market, costs must be much lower and part of that is having a supply chain that doesn’t require transportation costs from half-way around the world. A product must also reflect the actual needs of its market and not first world needs with features gradually paired down. By moving operations to India as a part of its commitment towards “Make in India”, they were able to fill a need and secure a strong foothold in the market by developing for a product in its intended environment and were also to do so in a way that cost 40% less(http://www.genewsroom.com/press-releases/ge-healthcare-strengthens-%E2%80%9Cmake-india%E2%80%9D-capability-accessible-affordable-healthcare). By identifying who they wanted to be in that market and what that market was really like, they were able to craft a winning strategy that will improve millions of lives.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.