Developing a theoretical and practical understanding of market research, planning and control, was the profound role upon studying Commercial Aspects of Product Design. As well as highlighting and providing a clear guide on studying the external and internal market share based on the market-led orientation and the strategic marketing decision making in corporation with understanding and meeting consumers’ needs and wants. All those terms were new to me and I thought why do we need a complicated plan that is time consuming to achieve a successful business? Afterward I found that it is an important factor affecting the long-term direction of the business. (Drummond, Ensor & Ashford, 2001)
As being a faculty member in product design at Imam Abdurrahman bin Faisal University in Saudi Arabia, and in term of teaching design process, marketing was considered as a secondary thought, we aimed to consider the market research investigate the stake holders among the segmented sample study, in order to develop a small structure about the main element to focus on while developing the concept design. Therefore, I haven’t got any further experience within the real field. I was enthusiastic and eager to. I was expecting the lectures rapped in a narrow range among selling and promotions, but afterward it was essential and clear how anticipation and adapting those strategies to change and keep in touch with the external competitor environment as well as matching the consumer desires with the organizations capability. So, while I was a teacher assistant we built our own structure and adapt it for the design studio lectures as shown on the next figure.
- FIGURE 1: PRODUCT DEVELOPMENT PROCESS.
As a result, providing what the market wants is recognised as well as the awareness of the competitor’s proficiency and strategy is required (Drummond, Ensor & Ashford, 2001). In my personal perception, I thought that an innovative product and design will have a great opportunity to attract investors and buyers in the market, but I was wrong. In fact, it need to appeal to the market place by starting to focus on the customer and user demand in identifying the product opportunities, the market segmentation, set target prices and be aware of the risks that might affect the organisation. However, those needs might change with the passage of time. Blackberry is a good example where they developed a great market share and a long-term trust between the company and its customers. Although they were one of the firs companies enhanced the touch screens in comparison with Nokia who profound that technology but kept it behind the scenes, both companies faced deterioration in the sale volume and became as cash cows while the iPhone raised as a Star (BCG Matrix, developed by the Boston Consulting Group). However, the demand of developing the internal operating system is a huge investment for unique platform products where it is simpler to develop a built-on technology. On the other hand, they studied the probable risks to limit as possible, especially when they wanted to redrive consumers to a new innovative technology.
In agreement, Davidson (1997) believes that companies should “Keep in touch” with their market’s changing needs to avoid the strategic drift or strategic wear-out. According to Keeley (2013, P.9) he asserts that companies need new discoveries and strategies to drive growth and survival. He thinks that efficiency is no longer enough, organic growth is critical to achieve breakthrough results. Moreover, customer engagement innovation is about understanding the aspirations of customers and users, and using those insights to develop meaningful connections between them and the company. Increasingly, this method takes place in the social media space, where companies and consumers become trusted partners among this process and they experience and test the products to supply with feedback. In illustration, this trust relationship plays a profound role on the success of Snapchat company. Where they show off their new hardware and software to some consumers who were hired as developers (Keeley, 2013, p.57). This type of internal analysis is adapted by Osterwalder, Pigneur, Bernarda and Smith (2014, P.49) as the product market fit where it is considered as the second phase in searching for Fit of the Value Proposition around products.
- FIGURE 2: THE PRODUCT MARKET FIT IN VALUE PROPOSITION DESIGN COPYRIGHT BY ALEX OSTERWALDER AND TEAM, 2014
It takes a place in measuring the efficiency of validating the assumption underlying the value preposition through the extent of customer care. That leads to understand the business to business (B2B) transaction by involving the stakeholders to evaluate and use that product or service. Unfortunately, this model doesn’t highlight enough in marketing, copywriting and persuasion techniques. It doesn’t guide the user into creative thinking and honest self-evaluation as well as the customer behavior or the user experience.
As a result, I found an interesting template called “value proposition canvas”, a chart that maps the key things that make up your product and why people buy it. This approach covers what really drives consumers, rather than just describing their social and economic characteristics by achieving their underlying motivations, their objectives and what holds them back. This will result in uncovering a new or better opportunities to satisfy consumers.
- FIGURE 3: THE VALUE PROPOSITION CANVAS INCLUDES ELEMENTS FROM BEHAVIORAL PSYCHOLOGY AND DESIGN THINKING.
So, understanding customer wants well enough is important in order to create a superior value. However, Marketers believe that the customer orientation is considered as on element of the market orientation (Never and Slater, 1990). Their prime emphasis is to understand what is going on outside the organization, by considering the competitor’s restrictions, to develop inside. Although this might be costly and time consuming, but it affected positively on the market dominance .
companies such as Colgate Palmolive, where they utilized this strategy to adjust their product, price and customer service to suit their customers and provide good value. They produce variable products to meet the consumers need such as the demand of whitening and sensitive. And every time they release products depending on the outcome of consumer’s feedbacks. Therefore, it is considered one of the largest leading companies.
As a result, I have adopted the strategic planning framework (SOSTAC) with the strategic business plan, where I started focusing on the Situation analysis, including two main areas: the external and internal analysis. Along with the external environment analysis, I studied the macro environment in adopting the “PESTEL frame work” and “Porter’s 5 forces” in order to understand the priority, using relevance information’s, understand what we can do, what are we capable of. PESTEL frame work are trends affecting my organization positively or negatively. For example, shipping stuff in trucks will negatively cause me more money, whereas in term of social trends, the number of baby born will affect positively to sell more. Therefore, it determines basically to predict the worst and best case scenario in order to limit the risks. In term of the industry analysis, the porter’s 5 forces play an important role to understand the level of competitors and creates a greater insight for the company to understand the relationship that exists within that industry, mainly to understand the dynamic of the market and where the power lies (Porter, 1980). I considered the political, economic, social, technological, environmental and legal forces, whilst the strong competitive forces might be a threat, especially that I am aiming to inter an existing product to a new market where there are strong competitors taking place in the market such as Colgate and Oral-B. On the other hand, those forces considered as weak could open up opportunities, in term of the suppliers where the company owns its own factory Powered by Sunshine.
Then I started analyzing the micro environmental analysis, by modelling the product lifecycle. It contains the introduction, growth, maturity and decline period where each product goes among those steps. In my situation, Radius company is established and well known in the United States. However, one of their future goals was to share their products with the global market. Therefore, they were considering to step further to the expansion of the company. As a result, I adopted that idea and started considering and studying that idea. Therefore, I considered the position of the company within the competitors and to be more focused I concentrated the study on children’s toothbrushes and found that although Colgate is establishing a great foundation of consumer trust with a 27% share of value sales (Euromonitor International, 2016), Radius has a great opportunity to compete, its price is slightly more than the competitors but it provides the consumer with a better quality and a long-lasting brush. This was shown as well by adapting the Generic Strategy Diagram (Porter,1980).
In order to understand the dynamics of the market and the competitors, where it is considered as a big orientation of the market analysis, what are they offering to the market and to meet the needs and wants to the consumers better than the competitors, I applied two main tools developed by consultancies: The 7Ps & The BCG Matrix. The competitor analysis was mainly around the 7Ps considering: the product, price, Promotion, place process, people and physical evidence.
To further understand the market, I started looking on Office for National Statistics (2014) and it shows that there is a recent deteriorate with live births. As a result, the number of sales might limit, Therefore the price should be taken in consideration. So, it allowed me to observe how issues identified in the PEST report have had an effect on sales.
According to Henderson (2013) “To be successful, a company should have a portfolio of products with different growth rates and different market shares”. Therefore, before starting analyzing the BCG Matrix upon the products that are already in the field and the new proposals, I looked at the company’s segmentation and analyses the Kids products in specific. Then analyzing the market share formula. This helped me to analyses the top market share companies in oral care and learn from their success. Afterward, I looked in the interaction between the consumer and the organization as the key element for achieving its board objectives. In market segmentations, I aim to raise the awareness on the importance of cleaning kid’s teeth.
Just like other everyday products that have “evolved” through beautiful, functional design, every one of Radius products is totally unique, devised for a specialized purpose, utilizing different materials and manufacturing techniques. Therefore, I adopted the Two-level channel of the chain distribution. Where the cycle starts from the resources to manufacture and ends on the retailers toward the consumers. This method helped me to be aware upon the different between consumers and customers and compare it with the B2B transaction theory.
Although the philosophy of brushing teeth is global, the idea of “on size fits all” is not applicable. Therefore, the company segmented each type of consumer in the Product segmentation section. Therefore, I looked in the internal analysis, considering the core competence theory and it has been claimed that its core competency is Radius Kidz toothbrush, and worked as a trade mark and can’t be copy.
So, I decided to summaries the key findings of the situation analysis with the SWOT analysis of the company. As a consequence, it allowed me to investigate my company’s internal strengths and weaknesses as well as its external opportunities and threats.
The hierarchy of objectives is where both the objectives and the strategy are considered as the strategic choice. Therefore, the companies mission was to consider all the products to be functional and aesthetically appealing. According to Drummond (2001), A successful mission statement must be realistic and believable, unique, specific and aspirational. This resulted successfully the company in displaying their first revolutionary product, the RADIUS Original®, at the Smithsonian Institute National Design Museum.
Moving on to the strategic choices, where I adopted the Ansoff’s Matrix (1957) to develop a competitive advantage, and to generate growth. The Ansoff Matrix is focusing on the inside view of the product and the market, in four different aspects: the market pentation, the product development, the market development and the diversification. However, he didn’t consider creating a new market. On the other hand, Porter’s generic strategies (1980) is focusing on the outside world and the market position.
- FIGURE 4: ANALYZING THE GENERIC STRATEGY DIAGRAM, PORTER (1980)
In term of the risks decisions, the biggest organizations consider the blue and red ocean strategy, companies can pursue and create blue oceans of uncontested market space in an opportunity-maximizing, risk-minimizing way.
- FIGURE 5: THE BLUE AND RED OCEAN STRATEGY, ADOPTED FROM WAYENBERG, 2014
Most of the small, startup companies don’t have the budget cash and they have an innovative product to establish. So, they focus in being on a new market or industry, new demand, where there are no competitors. After succession, they become a red ocean, where they try to hold their position and beat the competitive. I found some similarities between the blue ocean strategy and Aaker’s (1995) where both consider to develop a new product, so that they generate growth, as well as the implement in deteriorating the cost.
Then I started looking on the different approaches to target different segments, where some of the products that are in the company segmenting on particular customers, such as the Original toothbrush and the Kidz toothbrush where they both afford pieces for left handed or right handed customers.
Translating those strategies to a specific action using the 7P’s market mix, was the next methodology, where I implement one of the main products that the company produce, and analyses it, that led me to learn how to be better than the competitive and how consumers will perceive the product. There is a debate in term of the 8th P (partnership), where meeting the customer need is essential.
The traditional tool for representing the timing of tasks is the Gantt chart. It contains a horizontal timeline represents the start and the end of each task. As part of the action factor, I never thought about having a long and short term plan before, I always end up with designing the product but never thought about what will be next and how to achieve those tasks. By the end, using the control factor I summaries the whole process by explaining the daily, weekly, monthly, and ongoing plans.
Overall the SOSTAC marketing process has been a vital tool in developing my own products in the future. I gain a great understanding on the market orientation and the market share, the analysis of the industry, the competitors and the consumers as well. The research has led me to understand the risks that I might face and to consider the consumer’s needs and wants while creating a new product or service. Creating a strategic plan with reliable goals to provide customer satisfaction. Going forward I will use those tools outlined above to build a framework and use it while teaching.
- Osterwalder, A. Pigneur, Y. Bernarda, G. and Smith, A. (2014) Value Proposition Design. John wiley & son: Canada P.49
- Drummond, Ensor & Ashford, 2001
- Keeley, L. Pikkel, R. Quinn, B. Walters, H. (2013) Ten types of innovation, the discipline of building breakthroughs. John wiley & son: Canada, P.9
- Ensor, J; Drummond, G; Ashford, R. (2008) Strategic Marketing Planning and Control. Third Edition. Oxford: Elsevier.
- Ferell, OC; Hartline, D. (2012) Marketing Strategy. Sixth Edition. Mason, USA: South Western Educational Publishing.
- Ulrich, K. & Eppinger, S. (2012) Product Design and Development. Mcgraw.Hill International Edition.
- Thomson, J. (2013) Value Proposition Canvas Template. [Online] Retrieved from: http://www.peterjthomson.com/2013/11/value-proposition-canvas/
- Figure 1: Product development process.
- Figure 2: The product market fit in Value Proposition Design, 2014
- Figure 3: The value proposition canvas includes elements from behavioral psychology and design thinking.
- Figure 4: Analyzing the Generic Strategy Diagram, Porter, 1980
- Figure 5: The blue and red ocean strategy, Adopted from Wayenberg, 2014