The first step in defining the market strategy is to determine which current product offerings to target at each of the outcome-based segments that have been discovered. This should be decided based on “fit”: choose the offerings that best satisfy the unmet outcomes of customers in each outcome-based segment. For example, we once helped a manufacturer of industrial pumps discover a segment of customers that were underserved because they frequently encountered conditions that led to cavitation (the formation of air bubbles). The company had a number of products that addressed this problem well, but it had never targeted those products at the underserved segment with the right messaging. Knowing to target those offerings at that segment was the first step to success.
In one of Strategyn’s first engagements, we helped Cordis discover that one of its existing products satisfied a number of outcomes that were not well satisfied by top competing offerings. The “un-messaged strengths” of this product were subsequently communicated to customers. The result was a significant increase in market share: from 1.5% to 5% over the next six months. Knowing that a product has features that are a competitive strength in a segment of the market is an important insight when it comes to aligning a product portfolio with customer needs.
Using ODI, Coloplast’s wound care division discovered a segment of wound care nurses that had 15 underserved outcomes, 10 of which were associated with making sure a wound did not get worse. While Coloplast’s competitors focused on how their products helped wounds heal faster, Coloplast decided to go with an outcome-based value proposition. It promoted the fact that its products would “prevent complications” and highlighted the product features that addressed the associated outcomes. With this new value proposition, the company achieved double-digit growth in less than six months.
