We continue to believe that done well, market segmentation is not just a critical marketing tool, but can be the defining element of your overall strategy. In our previous blog post, we shared of the most common difficulties in getting to a workable needs-based segmentation. So what can you do to avoid those mistakes above and unleash the power of an effective segmentation?
In our Grassroots Strategy workshops with clients, the highlight of the week is often market segmentation. Done well, it is one of the most important changes in the way you think about your business and customers – the customers you choose to serve and how you serve them impacts both the revenue and the expense sides of your income statement. But too often, teams struggle to do it well.
In 1998 Concur revolutionized the software industry by introducing their Software as a Service (SaaS) pricing and delivery model, rather than the traditional license and maintenance model. The model was revolutionary at the time because for a fixed monthly fee, customers got access to a continuous stream of small upgrades, rather than getting stuck on an old version and facing a big upgrade expense when they chose to upgrade.
Fast forward to today, and it is hard to imagine buying most software through anything other than SaaS. Now a recurring theme that we hear from our non-software customers is that they want to move their business to a subscription-based model, but is XaaS (anything as a service) really the best answer for everything?
It turns out that, as is true for most things, XaaS is not the best fit for every offering. There are seven things that need to be true for XaaS to be the optimal answer for your business.
Decision making in times of unusual uncertainty is one of the greatest, perhaps the single greatest, challenges of leadership. Navigating the current COVID-19 crisis and crafting appropriate responses has been a challenge for leaders around the world. And whatever happens, we are likely to have years of second-guessing as to what we could have done differently. To some extent this is inevitable – with so many unknowns, it is a certainty that we either over-reacted or under-reacted, deploying certain measures either too early or too late; and we may never know which, as we cannot go back in time and try something different.
With all the major sports leagues shut down, perhaps it is more important than ever that we keep alive that grand American business tradition – the sports analogy. So here it goes: boxer Mike Tyson once said “Everyone has a plan ’til they get punched in the mouth.” At this point in the Covid-19 crisis, that sums up where most companies are with regards to their 2020 plans – we are reeling from being punched in the mouth.
Our hearts go out to all those who have lost loved ones, and our thanks to those who have been risking their lives on the front line fighting this invisible enemy. As we write this, there appears to be a light at the end of the tunnel, people are talking about plans to re-open the economy. But to Mr. Tyson’s point, those can’t be the same plans that we had coming into the crisis. You’ve been punched in the mouth, what do you need to change before the bell rings to start the next round?
What do Rock ‘n’ Roll, innovation and defense technology have in common? If you’ve heard this story, you probably have a guess. If not, it might surprise you to find the answer is one person: Skunk Baxter.
Pricing is one of the most important levers your organization has, therefore pricing decisions are some of the most important it will make. Set the price too high, and you won’t sell anything. Worse yet, set the price too low and you are leaving money on the table.
That leads to the question, what department or function within your organization is in the best position to set the price in order to maximize earnings?
Rethinking your plans in light of the unthinkable To call these times turbulent is an understatement. Obviously reducing the risk to lives is paramount, but the unprecedented threat of the Covid-19 virus and the necessary response are already wreaking havoc across the economy, with some second and third order effects that may be felt for… Continue reading This is a Time for Thoughtful Re-Planning
In 1759, Arthur Guinness leased a disused brewery in Dublin and began producing beer for the local market. Like most brewers of his time, he produced a variety of beers to meet a variety of tastes. But by the late 1770’s, Guinness was becoming known for his porter. The dark beer that used roasted barley to produce a deep brown color and rich complex aroma had become quite popular, especially among the dockhands in Dublin. In 1799, faced with a shortage of capacity, Guinness made the bold decision to discontinue production of his various other ales and focus exclusively on the porter – the beer we know today as Guinness Stout.
This historical tale underscores one of the most powerful and difficult challenges of strategy – focus.
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