April 2011 | Nano Tools | Marketing
Create long-term sustainable advantages through market segmentation and granular data.
Creating a sustainable advantage is challenging even in the best circumstances. But it can be particularly difficult when there is minimal differentiation between you and your competitors, when you are competing almost exclusively on price, and/or when you’re doing business in a stagnant market.
Many organizations are already collecting the kinds of data that can help them identify that advantage, but they’re often not making the connection between that data and their decisions. Market research can be a powerful tool for strategic decision making, helping to identify the varied desires, motivations, and actions of consumers, who can then be grouped accordingly. Armed with those consumer groupings, firms can assess alternative segments to target and ultimately serve that segment(s) with a unique offering.
The principles above were implemented by Shell Oil in the early 2000s after recognizing that short-term tactics would only lead to a “prisoner’s dilemma” (in which two players are likely to avoid cooperative strategies that might actually be in their best long-term interests) and declining long-run industry viability. To create a long-term competitive advantage, Shell employed a process which typifies advanced marketing research, including:
Shell’s efforts illustrate the need for advanced marketing research with corporate integration for implementation. This effort was led by Professor Reibstein.
Nano Tools for Leaders® was conceived and developed by Deb Giffen, MCC, Director of Innovative Learning Solutions at Wharton Executive Education. It is jointly sponsored by Wharton Executive Education and Wharton’s Center for Leadership and Change Management, Wharton Professor of Management Michael Useem, Director. Nano Tools Academic Director, Professor Adam Grant.
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