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BOS: Reconstruct Market Boundaries

BOS: Reconstruct Market Boundaries. Bailey Anderson, Angela Chavez, Tucker DeVinny. Six Path Framework. Look Across Alternative Industries Look Across Strategic Groups Within Industries Look Across the Chain of Buyers Look Across Complementary Product and Service Offerings

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BOS: Reconstruct Market Boundaries

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  1. BOS: Reconstruct Market Boundaries Bailey Anderson, Angela Chavez, Tucker DeVinny

  2. Six Path Framework • Look Across Alternative Industries • Look Across Strategic Groups Within Industries • Look Across the Chain of Buyers • Look Across Complementary Product and Service Offerings • Look Across Functional or Emotional Appeal to Buyers • Look Across Time

  3. Path 1: Alternative Industries • Blue ocean strategy focuses on looking at alternative industries as opposed to just rivals within the current industry • American airlines can capitalize on this strategy by scoping out other modes or transportations such as charter bus transportation and trains.

  4. Path 2: Strategic Groups in Industry • Strategic groups are defined as a cluster of companies in a specific industry who have a similar strategy to follow. • Strategic groups can be formed based on levels of price and performance (Luxury brands competing while economic brands compete) • American Airlines competes with Delta, JetBlue, and Southwest at a similar price range. • Ultra-Low Cost Carriers (LCCs) like Spirit, Allegiant, and Frontier compete with each other at a much lower price point.

  5. Path 3: The Chain of Buyers • The Chain of Buyers • Purchasers: Office Equipment Industry • Users: Clothing Industry • Influencers: Pharmaceutical Industry • Target different customer segments • Large vs. Small

  6. Path 4: Complementary Product and Service Offerings • Untapped value is hidden in complimentary products and services • Look at the process before, during, and after the product is used • Ex: A movie theater with a babysitting service

  7. Path 5: Functional and Emotional Appeal to Buyers • Functional Appeal • Compete principally on price and function largely on calculations of utility • Emotional Appeal • Compete largely on feelings • When companies challenge their functional-emotional orientation, they often find new market space • Examples: QB (Quick Beauty) House, Cemex

  8. Path 6: Time  • Key insights to blue ocean strategies arise from how the trend will change value to customers and impact the company's business model • Three critical principles to assessing trends • Trends must be decisive to your business • They must be irreversible  • They must have a clear trajectory • Example: iTunes

  9. Questions?

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