At Simon Associates Management Consultants (SAMC), we have recently been working with clients who are struggling with an abundance of competition in their "red oceans." As you may know, we are Blue Ocean Strategy® professionals and corporate anthropologists. And, we are big believers that people cannot see what is often before their eyes.
Red oceans are a metaphor for a highly competitive market space where businesses follow a traditional methodology promoted for years by Michael Porter and others. The thinking goes like this: carve out your market, differentiate your product and service offerings, and find your market space at the right price point to generate a good margin. The only problem is that today, there is too much supply and competition and too little demand for products, services and solutions.
In a business slump? Maybe you need to go exploring!
The best way to do that is to "hang out" and watch your customers—and non-customers—get their jobs done.
At SAMC, that's what we specialize in: helping clients realize the great potential of finding their "blue oceans" where they make the competition irrelevant, capture and create new demand, go after unmet needs, and value-innovate (not value-incrementalize) their offerings. As John Seely Brown, visiting scholar at USC and the independent co-chairman of the Deloitte Center for the Edge, famously said, "The way forward is all around you." You just have to see it.
Today, I want to show you how to go visually exploring. This is a key part of how you can begin to see how your clients are really struggling to solve their problems, often with your own products. And what does that struggle represent? Opportunity!
Go Hang Out
I know it sounds simple but when our clients ask where they should begin visually exploring, we suggest that they "go hang out." To start you on your way, I recommend a great article in The Atlantic which explains how the research firm ReD conducted ethnographic research, or "deep hanging out," for Absolut Vodka.
ReD consultants went from party to party to watch how consumers bought, shared and drank vodka. What they learned was that vodka out of context was just another drink, but to those they observed, Absolut mattered. It went beyond the simple act of buying a bottle of vodka and giving it to the hostess. “We wanted to know what they are seeking,” Min Lieskovsky, one of the ReD operatives, told The Atlantic. “Do they want the ‘perfect’ cocktail party? Is it all about how they present themselves to their friends, for status? Is it collaboration, friendship, fun?”
What mattered most to the party goers and their hosts, ReD discovered, were the narratives that accompanied the drinks. "We found that there is this general shift away from premium alcohol, at least as it’s defined by price point, toward something that has a story behind it," Lieskovsky said. "They told anecdotes from their own lives in which a product played a central role—humorous, self-deprecating stories about first encountering a vodka, or discovering a liqueur while traveling in Costa Rica or Mexico." Only "hanging out" would have revealed this crucial insight.
It's all about engaging with customers in unexpected ways.
Here are 2 examples that illustrate this point:
Healthcare Client: For one of our healthcare clients—the CEO of a Midwest safety net hospital—we sat with him in the medical center's lobby and watched people use his facility. Watching the flow of foot traffic allowed him to see for himself what was really happening as people came and went. He needed to create a welcoming environment for the medical center's primarily low-income patients and their families, and it didn't take him long to see how challenging it was for people to find their way through the hospital's various wings and corridors to get where they needed to go. Literally by just "hanging out" with us, our healthcare executive was able to observe the very real obstacles people encountered as they attempted to navigate through the maze. It was hardly the warm and caring atmosphere the hospital brand needed to exude.
Another "aha" moments occurred when one of the hospital marketing staff realized that his father had no relationship with a primary care physician. This fact led us to discover that only 66% of men in the U.S. have primary care doctors. For this medical center, going after non-users with unmet needs—men—constituted a huge and unexpected opportunity to acquire new patients and was truly a "blue ocean strategy."
Manufacturing Client: For another one of our clients, we hung out with the company's own employees, sharing lunches and sitting next to them as they did their work. What we were trying to learn was how they were dealing with their customers, internally and externally. In one instance, we listened to how the sales team was trying to cold-call prospects, discovering in the process that the potential buyers didn't answer their phones. We observed their frustration. As we dug deeper, we began to learn more about the people they were trying to reach. Their old buyers were retiring and the new ones were of a younger generation, unfamiliar with the sales people, and sought solutions using the internet before they engaged a salesmen in their decision process. Ironically, the salespeople begrudgingly knew this. They just weren't ready to accept the fact the the purchasing process, and the actual purchasing person, were both changing—meaning, they had to change as well.
How can observing make the competition irrelevant?
While you are "hanging out," the key is to always be thinking: How can I use these insights to change the solutions my company is providing?
For that Midwest hospital, we helped them realize that patients felt very "alone" when they walked through their doors. They were just "another" healthcare provider. But, what if they could create a culture that ensured that no one was ever alone when they entered there? You can read the full story in my book, "On the Brink: A Fresh Lens to Take Your Business to New Heights," but changing the way the hospital thought about the patient was transformative, both for the organization and for physicians sending their patients there.
For the manufacturer, the realization that the next generation of buyers did not deal with salespeople like their predecessors had in the past was the "big idea." In fact, and much to their chagrin, the younger, millennial generation didn't really use the telephone at all. They went exploring on the internet and had an entirely different approach to evaluating their options.
Changes to make your competition irrelevant do not have to be hard or expensive
Often, they can just be about the way you engage with customers and help them through whatever challenges they are facing and which you are supposed to be solving.
For most of us, it is hard to shed old habits and ways of doing things that seem so sacred. It is equally hard for people to rethink their process for new times when for so long, it has worked so well—but now isn't.
To make your competition irrelevant, like our clients in healthcare and sales, you really have to stop, rethink the buyer and the buyer's journey, and then adapt to changing times before you have neither clients nor competitors. No one is waiting for you to deliver better products, services or solutions. Like the dinosaurs, you've got to adapt or die.
A video on making your competition irrelevant
I invite you to watch this video and listen to how we work with clients to help them make the competition irrelevant. Then try to apply some of the tools we share in our anthropologist's tool kit, designed to help you and your team more easily "see, feel and think" about your current business and your future customers with fresh eyes.
Want to learn more? Check out these 2 blogs on the subject.
- Blue Ocean Strategy® Needs Lots of Exploring
- 3 Ways Anthropologist's Toolkit Can Revitalize Your Company
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Want to find your Blue Ocean Strategy and see how it might help you find your customers of tomorrow? Please contact us at firstname.lastname@example.org.
From Observation to Innovation,
Corporate Anthropologist | President
Simon Associates Management Consultants