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BB-152 Killing a Profitable Product with Strange Differentiation v05

[Building Blocks] BB-152 Killing a Profitable Product with Strange Differentiation
Building Blocks (BB-152) - Killing a Profitable Product with Strange DifferentiationChasing new Customers without regard for maintaining existing Customers canresult in the shrinkage of Strange Differentiation and the destabilization of aProduct's Competitive Advantage. Competitive Story:Jetson Gears is catching up with the market leaders Spacely Sprockets andCogswell Cogs. To drive growth, George Jetson decides to devote all of his R&D tosatisfying the needs of those Customers who are most unsatisfied with hisProduct. In the meantime, Spacely Sprockets and Cogswell Cogs expend thesame R&D but raise the Willingness To Pay (WTP) of all Customers evenly. Jetson Gears starts with a"Niche Focus" strategy, offering alower quality Product butfocusing on the unmet needs ofa subset of Niche Customers. Next, Jetson Gears changesstrategy and instead focuses onfixing the problems of his mostdisgruntled potential Customers. The new strategy is a failure.While the total market has grownsignificantly, Jetson GearsMarket Share has dropped from20.6% to 14.4%. The new strategy has reducedthe Strange Differentiation ofJetson Gears. The Product'sStandard Deviation (SD) hasdropped from 49.4 to 43.7. Customers who hate JetsonGears get a double-investment(of $20). Customers who loveJetson Gears get no additionalinvestment ($0).Original ProductDefinitionsWillingness ToPay (WTP) MatrixAdd Most Valueto LowestWTP CustomersJetson GearsSort by WTPDecreasingRank by IncreasingCustomer ImportanceResultsBefore R&DResultsAfter R&DStandard Deviation(SD) BeforeStandard Deviation(SD) AfterEvenly ImproveSpacely SprocketsCogswell Cogs Table Creator CustomerDistributions Scale Demographic Sorter Counter Generation Simulate Market Simulate Market Statistics Statistics Scale Demographic Building Blocks (BB-152) - Killing a Profitable Product with Strange DifferentiationChasing new Customers without regard for maintaining existing Customers canresult in the shrinkage of Strange Differentiation and the destabilization of aProduct's Competitive Advantage. Competitive Story:Jetson Gears is catching up with the market leaders Spacely Sprockets andCogswell Cogs. To drive growth, George Jetson decides to devote all of his R&D tosatisfying the needs of those Customers who are most unsatisfied with hisProduct. In the meantime, Spacely Sprockets and Cogswell Cogs expend thesame R&D but raise the Willingness To Pay (WTP) of all Customers evenly. Jetson Gears starts with a"Niche Focus" strategy, offering alower quality Product butfocusing on the unmet needs ofa subset of Niche Customers. Next, Jetson Gears changesstrategy and instead focuses onfixing the problems of his mostdisgruntled potential Customers. The new strategy is a failure.While the total market has grownsignificantly, Jetson GearsMarket Share has dropped from20.6% to 14.4%. The new strategy has reducedthe Strange Differentiation ofJetson Gears. The Product'sStandard Deviation (SD) hasdropped from 49.4 to 43.7. Customers who hate JetsonGears get a double-investment(of $20). Customers who loveJetson Gears get no additionalinvestment ($0).Original ProductDefinitionsWillingness ToPay (WTP) MatrixAdd Most Valueto LowestWTP CustomersJetson GearsSort by WTPDecreasingRank by IncreasingCustomer ImportanceResultsBefore R&DResultsAfter R&DStandard Deviation(SD) BeforeStandard Deviation(SD) AfterEvenly ImproveSpacely SprocketsCogswell CogsTable Creator CustomerDistributions Scale Demographic Sorter Counter Generation Simulate Market Simulate Market Statistics Statistics Scale Demographic

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Created by: Berlin
Created at: 2018-12-19
On NodePit since: 2021-02-05
Last update: 2024-04-25
Created with KNIME version: v4.3.0

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