Market Sensing

Segmentation, Targeting, Positioning

“Where do we start from”

Rajesh Pandit
Suri Valluri
 Business Market Management

Managing New Business

Market Offering Channel
Offerings Realization Management
Market
Sensing Gaining
Customers

Understand Understanding Creating Delivering Sustaining

firms as Value Value Value Reseller
customers Relationship

Crafting Sustaining
Market Customer
Strategy Guiding Principles Relationship
• Value as the cornerstone
• Focus on business market processes
• Doing business across borders
• Importance of relationships, networks 2
Market Sensing

• Process of generating knowledge of the

market
• Used by everyone in the organization to guide
their decision making
• Market driven process
• Learning about present and prospective
customers, other actors and the environment
that affects these customers

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Market Sensing
Defining the Market
• Market Segmentation A
• Determining segments of interest

Monitoring Competition
Market Sensing • Competitor analysis B
• Formulating and • Improving monitoring performance
testing market views
• Guiding decision
making Assessing Customer Value
• Value assessment
• Customer value management

Gaining Customer Feedback

• Customer satisfaction
• Net Promoter Score
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A. Defining the market

A2.
A1. Market
Segments
Segmentation
of Interest

• Decides how the firm views

– A market
– What its prospects are
– Course of action to be pursued
• Identification of significant differences in requirements
and preferences for market offerings
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 A1. Market Segmentation
Four criteria to judge the validity of segmentation

Can the size, growth,

and market potential
Can marketing and sales Measurable of a segment be
programs be formulated measured?
for attracting and serving
the segments?

Effective
Actionable Profitable
Segmentation
How profitable is the
marketing effort?
What is the payoff?
Can segments be
Accessible
identified and
reached successfully?

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Shift in Segmentation approach

Progressive Basis

Conventional Application of the market

Basis offering
Industry
Customer capabilities
Customer size
Customer’s business priorities
Geography
Usage situations

Profitability
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A2. Determining Segments of Interest

• Articulating who you should not sell to!

Segment Size and

Growth
(Market Potential, Total
Market Demand)
Segments of
Interest
Sales and Profit
Potential

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Determining Market Potential

• Build up method
– Market potential estimates from sub-segments using
secondary or primary research and combining them
• Chain Ratio method
– Identifying large number of prospective customers and
assigning various ratios
– Documenting assumptions and validating as you
progress is critical
• Index method
– Factors as proxy

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Choose your “Pond”

• Hush Puppies vs Nike

• Walmart

• American Express cards

• Ability to create new segments!!!!

• Coca Cola – Roberto Goizueta, CEO

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 Choose your “Pond”

New
Needs

Existing

Existing New

Customers
Source: Ansoff 11
Your sector

• Growth opportunities in your sector

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Exercise

WHAT IS YOUR “POND”!

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Establish the genetic code
• How people make decisions?

• How they work together?

• Mindset starts at the top

• Should reach all the way to the bottom!

– Creating transformation leaders at all levels to establish
new beliefs!
• “Business development is everyone’s responsibility”
– Gary Wendt, CEO, GE Capital Services
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Footwear Salesperson

• Sales Person from two footwear companies

were sent to a Remote Continent.
– On landing one person immediately called and
said there is no business here, I am coming back
on the same ship

– On landing the second person immediately called

and said that I am settling down here, send a
container full of footwear.

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Caution!

• Complacency

• “Decaying” strategies
– Successful present is already history

• “Curveball”
– Honeywell example

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Macro environment

• Volatility in economy, society

• Opinions of Economists, Market Experts
– Global and Local views on Recession, Stock
Market, Currency, Commodity
• Dramatic currency fluctuations
– INR depreciation of 20% in 4 months followed by
10% appreciation in 1 month
• Shift to Relative Performance Metrics
• International Trade situation
– Societal condition driving Protectionism 17
Market Sensing
Defining the Market
• Market Segmentation A
• Determining segments of interest

Monitoring Competition
Market Sensing • Competitor analysis B
• Formulating and • Improving monitoring performance
testing market views
• Guiding decision
making Assessing Customer Value
• Value assessment
• Customer value management

Gaining Customer Feedback

• Customer satisfaction
• Net Promoter Score
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B. Competitor Analysis

• Competitor’s Future
Goals
• Current Strategy
• Capabilities

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 Competitor Intelligence System

Step3.
Take action Focus

Step2.
Analyze data Techniques

Step1. Sources
Build the
foundation
Preparation

Source: Fuld Intelligence Pyramid 20

Competitor intelligence

• Preparation - Assemble research team

- Learn the industry
- Use intelligence checklist
- Collate articles
- Set up search strategies

- Industry experts, analysts

• Sources - Sales literature
- Tradeshows, Conferences
- Annual reports, Regulatory filings
- Market and brokerage reports
- Suppliers, Academicians, Sales reps
- Help wanted ads, Media

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Competitor intelligence

• Techniques - Benchmarking
- Scenario building
- Profiling
- Porter’s framework
- Timelining/ Trend analysis
- Set up search strategies

• Focus - Review critical uncertainties

- Point to opportunities
- Warn of threats
- Anticipate objections
- Identify “Hot buttons”

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Positioning your product

“Positioning is not what you do to a Product.

Positioning is what you do to the Mind of the Prospect”

- Al Ries & Jack Trout

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 Differentiation Variables
Product Services Personnel Channel Image
Features Ordering Ease Competence Coverage Symbol
Performance Delivery Courtesy Expertise Written &
Audio Visual
Conformance Installation Credibility Performance Atmosphere
Durability Customer Reliability Events
Training
Reliability Customer Responsiveness
Consulting
Repairability Maintenance Communication
& Repair
Style Miscellaneous
Design

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Value Proposition Elements

Desirable & Deliverable &

Relevant Profitable
Points of
Parity

Points of
Contention

Points of
Difference