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Go deeper than your competitors in Stagnant market conditions

What can you do to build business intimacy with your current and future customers in stagnant market conditions?

Go deeper than your competitors in stagnant market conditions - article image

Stagnant trading conditions in Australia should force a renewed focus on market-share-switching initiatives.

Why the concern?

The chart below shows some apparent GDP stagnancy of Australian non-mining business sectors of around 3% growth for the last ten years — a clear step change compared to previous periods.

stagnant market - graph

(Sources: Courtesy of and with approval from Alan Kohler at The Constant Investor.

August 2016.)

The major challenge, in my view, is how to win and sustain the prize of higher profit ratios, clear market leadership and greater share of customers’ wallets when demand conditions are unambiguously stagnant at low growth levels.

You must start with a refreshed view of the racetrack, the market climate and headwinds, your own fitness, the competitors’ strengths and weaknesses, the landscape through to the finish line and the prize.

That will demand a renewed focus on switching customer share to you using deeper segmentation and customer experience development tools and insights.

The deeper you go, the better you’ll understand opportunity. Those new segments that are viable, should deliver new opportunities to grow your customer portfolio profit-mix potential when others are still taking macro stances towards markets.

How do you approach this?

Start by sketching the market structure. This should show the channels through the demand and supply chain and thus act as a reasonable proxy for high level market segmentation.

Market segmentation deep dives should then be done around core customer needs.

After all, market segmentation’s purpose is to identify the optimal way of grouping customers together; so that you can best identify your competitive opportunity, value proposition, clear positioning and sustainable competitive advantage.

Market research and strategy  can then proceed to create value for customers to encourage their volume-switching to you in tough trading conditions.

Additionally, big data management will be key to understand micro segments’ customer buying behaviour.

Head of Marketing at SAS, Iggy Pintado says, “The deployment of predictive analytics is rapidly becoming a key driver of innovation. Where it has long delivered incremental value at the operational level, enlightened C-Level executives now recognise that analytics has a critical role to play in uncovering insights for decision-making at board level.

Indeed, as data proliferates thanks to digital disruption, think about the encouragement of customer-driven social media transactions by big business; ever more numerous engagement channels; cloud computing; mobility and more. Trying to derive meaning from the information-inundation without analytics is uselessly slow at best, and impossible at worst.

Fortunately for our national competitiveness and future prosperity, we see Australian organisations in both the public and private sectors embracing analytics with gusto. And the technology to do so is here and proven. At SAS, we work with companies that are handling five billion transactions a month, yet can visualise from all that data in mere seconds,” Pintado concluded.

Marketing gun Tom Sullivan, General Manager – Marketing and Sales Excellence at Canon Business Services says, “Focusing on the unique value a solution creates for your customer is critical in any hyper-competitive market. E-Commerce and Digital platforms have opened the customer to full information on features and benefits as well as price of commodity items.

Customers are seeking value from their suppliers and partners to help in achieving their business goals. An effective value proposition focuses on the customer’s outcomes that a solution drives, and how it affects your customers goals.”

Often, growth opportunities through new segments and value propositions are right under your nose. It takes a fresh pair of strategic eyes, deep industry sector experience and knowledge, lateral innovative thinking and best-practice segmentation processes and skillsets to distil the options into realistic priorities.

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