Dr. Dawne Martin

MKTG 241

January 29, 2013

OPPORTUNITY IDENTIFICATION

LEARNING OBJECTIVES

• Review the Opportunity Identification paper

• To investigate trends in the external environment that offer new business opportunities

• Review “discovery skills” identified in the HBR article “The Innovator’s DNA”, December 2009

• Identify trends in the environment

• Determine how the trends justify the business opportunities

• For next time: Marketing for Entrepreneurs, Chapters 3

ONE-PAGE OPPORTUNITY IDENTIFICATION

• Due: Thursday, January 31, 2013

• Trends: Identify, document and describe trends relevant to the opportunity

• Opportunity: Describe the opportunity, including industry, business model and target market

• Justification: Expand on trends and how the trends suggest this opportunity

THE INNOVATOR’S DNADYER, GREGERSEN & CHRISTENSEN, HARVARD BUSINESS REVIEW, DEC. 2009

• Senior executives in most innovative companies take responsibility for creative work – spend 50% of time in “discovery skills”

• Discovery skills

• Associating

• Questioning

• Ask “Why?”, “Why not?”, “What if?”

• Imagine opposites

• Embrace constraints

CHARACTERISTICS OF A GOOD OPPORTUNITY

• Creates significant value for customers– solving an important problem, fulfilling a need – willing to pay premium price

• Offers significant profit potential – meets risk/reward expectations

• Good fit between entrepreneur’s capabilities and expertise

• Offers sustainability over time

• Can obtain financing

INNOVATOR’S DNA (CONTINUED)

• Discovery Skills (continued)

• Observing: potential customers, suppliers, competitors

• Experimenting

• Intellectual exploration

• Physical tinkering

• Engaging new environments

• Networking : with diverse individuals

GLOBAL TRENDS• Economic Trends

• Consumer Trends

• Financial Market Trends

• Technology Trends

• Social Media Trends

• Mobile Trends

• Demographic Trends

• Design & Fashion Trends

• Health & Wellness Trends

• Travel Trends

• http://www.globaltrends.com/features/strategy-a-leadership/67-10-key-trends-to-watch

ERNEST & YOUNG GLOBAL TRENDS

http://www.ey.com/GL/en/Issues/Business-environment/Six-global-trends-shaping-the-business-world

FAITH POPCORN:EN-GEN2011: FAITH POPCORN’S BRAINRESERVE PREDICTIONS

• EN-GEN: End of traditional gender roles – neither males nor female, just human

• Trends

• Women hold 51% of managerial & professional jobs

• 4 of 10 mothers are primary breadwinners, bring in close to ½ household income

• Single, childless women under 30 earn 8% more than male peers

• Number of women with 6 figure salaries increased by 14% in last two years

• Women’s health following men – increase in chance of heart attacks, heart surgery

GENDER TURNING POINTS: OPPORTUNITIES

• Merger of Artistry & Technology – simple, elegant design (Nespresso)

• Beyond the Bento Box – men & women experiment with interests and ideas normally associated with other gender

• Electric Shock: Electric vehicles combine women’s concerns for environment with men’s love of technology

• Recession Lift: Economy has made it difficult for men 45+ to compete – boom in male plastic surgery

• Veganomics: More sensitivity to sources of food and consumer products leads to growth in vegan values in all areas (bamboo floors, MooShoes)

• Robot Frenzy: Breakthroughs in robot technologies in medicine, manufacturing, prosthetics, military and more

BUSINESS MODEL BUILDING BLOCKS• Customer Segments

• Segments

• Needs require and justify a distinct offer

• Reached through different distribution channels

• Require different types of relationships

• Have substantially different profitability

• Are willing to pay for different aspects of the offer

• Segmentation approaches

• Mass market – don’t distinguish between customer segments

• Niche market – specific, specialized customer segments

• Segmented – serve multiple segments with different needs

• Diversified – serves two unrelated customer segments

• Multi-sided Platform (or markets) – two or more interdependent customer segments (Ebay)

BUSINESS MODEL BUILDING BLOCKS• Value Proposition: Creates value for a customer segment through a distinct mix of

elements catering to segments needs• Newness – meets a new set of needs – cellphones

• Performance – improving product or service performance

• Customizations – tailoring product and services to specific customer needs – mass customization and co-creation

• Get the Job Done– Rolls Royce manufacturers and maintains aircraft engines

• Design

• Brand/status

• Price

• Cost Reduction

• Risk Reduction

• Accessibility

• Convenience/Usability

• Channels• Functions:

• Building awareness among customers

• Helping customers evaluate value proposition/alternatives

• Allowing customers to purchase specific products or services

• Delivering value proposition to customer

• Provide post-purchase customer support

• Channels Types

• Direct – sales force, web sites, own stores

• Indirect – Partners stores, wholesalers

• Customer Relationships

• Personal assistance

• Dedicated personal dinner

• Self-service

• Automated service

• Communities

• Co-creation

BUSINESS MODEL BUILDING BLOCKS

• Revenue Streams• Asset sales

• Usage fees

• Subscription

• Lending/renting/leasing

• Licensing

• Brokerage fees

• Advertising

• Key Resources• Physical

• Intellectual

• Human

• Financial

• Key Activities• Production

• Problem solving

• Platform/network

Business Model Building Blocks

• Key Partnerships• Optimization and

economies of scale

• Reduction of risk and uncertainty

• Application of particular resources and activities

• Cost Structure• Cost –driven

• Value-driven

• Cost structure characteristics• Fixed costs

• Variable costs

• Economies of scale

• Economies of scope

BUSINESS MODEL BUILDING BLOCKS

IN YOUR GROUPS

• Work on your Opportunity Analysis

• Identify your customer base and your unique value