In The Mid-Range Motorola Must Pull Marketable Products From Its Pipeline
Motorola’s mid-range goal should be to revive their brand relevance by developing and pulling new products out of the pipeline. Management should use the “utility-usage” technique which was outlined in the last article to translate utility directly into product features. Simply stated, use usage type and occasion to drive new features for new designs. Use these new models to position Motorola within specific marketspaces based on a combination of demographical, geographical, and lifestyle characteristics. At the beginning of this timeframe, Motorola should be well underway in dimensionizing the utility of key buyer groups; consider and/or use the key utility factors of Nokia cell phone buyers (Nokia is the world leader in terms of market share for cell phones) for features of new Motorola models. An extremely effective approach is to juxtapose features of new Motorola models with “missing” Nokia features – in other words, features that Nokia buyers want for their Nokia cell phones but don’t have. This is a “killer” strategy which would likely develop dominance for given buyer groups – the “trick” is to make it applicable to a widely reaching buyer group.

Recapture Share and Own Key Marketspaces For the Long Term
Motorola seems to be lacking a long-term vision for its cell phone business – which in a way is understandable given its current dire straights. But after they develop solid short-term measures to keep their cell phone business from crashing, they need to create an effective long-term strategy. This strategy should be simply this: recapture share and own key marketspaces. For a mid-range strategy, we talked about translating usage types and occasions into features to develop new designs. For Motorola’s long-term visioning, they should take it a step further and look to new benefits which fill desires and latent utility of key substantial buyer groups.

Tap Into Latent Demand
The long-term strategy for Motorola to exploit new benefits and tap into latent demand can be effective when executed by using orthogonal innovation of looking across other industries. In other words, what are the benefits accrued to customers or buyer groups in other industries which can be translated into features for Motorola cell phones? This is another point where breakthrough innovation can occur on a long-term and habitual basis. The essence of this strategy is to continually tap into latent demand for key customer groups – giving them benefits that they didn’t think about and want until they got them. This is how Motorola can own and dominate whole areas of a market space. The invention of the cell phone, iPod, and VCR are all examples of products which tapped into latent demand.

Motorola’s “Magic Show”
Motorola is in bad shape now, but given the right combination for the three-prong lock — short-term, mid-range, and long-term strategy – they can reclaim their market share, profitability, and strong brand equity. They need to minimize the bleeding in the short term by harvesting and milking revenue from their most popular current products – but without reinvesting in them. In the mid-range of two to four years, they need to “pull rabbits out the hat,” and introduce products which have features directly translated from the utility for key customer groups. Long-term, they need a “whole magic show,” impressing customers with “new tricks” that they didn’t even imagine before – features which tap into latent demand benefits. With this blueprint for success, the “motor” will rev back to life in Motorola.

Find New Channels of Potential Business – Blue Ocean Spaces
Small retailers are going to have to look for Blue Ocean Spaces, and find new channels of potential business. While these businesses are too small to own a marketspace, they can certainly carve out profitable niches. There are three areas which small retailers can focus on to develop new business: geographic, demographic, and usage (both occasion and type). They can carry merchandise and services centered around a locale – and have offerings which are highly relevant to a given community. This is a Blue Ocean which large national chains will find very difficult to follow because many are very centralized in structure. As a smaller craft in the Blue Ocean Seas, local businesses can more adeptly cater merchandising, marketing, and operations to uniquely fit communities, towns, cities, and regions.

Look Beyond Current Buyers Demographics
Small businesses can also look outside of the demographic profile of current buyers to target additional customer groups. This can be done effectively by evaluating alternative or complementary industry buyer groups. Small retailers can look for synergic “hooks” to fulfill the needs for either of these groups. A business mentioned in the WSJ article, Charles Mayer & Company, is an up-scale boutique seller of china, crystal, and decorative accessories in Indianapolis. An example of them targeting a complementary buyer group would be to develop an interior design service which shows home- and condo-owning customers the appropriate matches of various pieces to rooms and homes being re-modeled or built. This look across industries would also yield very synergistic opportunities to bundle with partner companies. To further extend our previous example, Charles Mayer & Company could join with an interior design firm outright to provide pieces for a price discount or items which are exclusive to the given designer.

Blue Ocean Spaces Through Alternative Usage For Product Or Services
The third way a small retailer can discover or create a Blue Ocean Space is through alternative usage for their goods or service offerings. This can take the form of different types of usage for their offerings, or different or varied occasion usages for their goods and services. Possible variations on usage fit well with the previously mentioned opportunities to bundle with other goods and services. Alternative uses for a small retailer’s goods or services can be uncovered by looking at a buyer’s experience with related products or services. These retailers should observe and evaluate these buyer’s experiences before, during, and after a given product or service is used. This will yield rich insight into how to extend, alter, or retract their offerings in terms of recommended uses for their given products and the services they offer around them. For example, small auto repair shops have observed the success of “oil change only” shops such as Jiffy Lube, and now include even more discounted oil change services of their own as a front-end bundled offering when repairing other parts of a customer’s car. In this case, the usage occasion was changed from a scheduled maintenance item to an upfront service and opportunistic sale for a small retailer.

Budgeting Marketing Resources
In the short-term time horizon, Detroit automakers should gear 65 to 70% of their marketing budgets and resources for crossovers toward the price inelastic geographical/regions based on demographical factors.  They should devote a “trailing” amount of marketing resources of 30 to 35% to price elastic buying segments in given geographies and regions.

Game Plan Adjustments: Mid Range Structural Solutions
Detroit automakers, GM and Ford, can solve this ailment structurally in the mid-term by making adjustments to their “game plans”.  They should look to design and build smaller or mini-crossover vehicles to address the permanent and endemic outlook of substantially higher fuel prices and buffer against less discretionary spending in the mid-term future for Americans.  From a classic Blue Ocean perspective, they need to raise the dimensionality of gas efficiency dramatically for crossovers, and moderate or lower the sales price by making “light” crossover vehicles.  It can achieve this by building them with even lighter chasses.  Also, classically Blue Ocean, they can reduce the engine horsepower to minimum acceptable threshold levels.  It’s likely that consumers are willing to accept a lower amount of horsepower relative to increased fuel efficiency and a lower sales price.

By operating from a holistic perspective, GM and Ford can change the game by developing a wider range of these vehicles focused around various buyer groups according to lifestyle and usage.  They should offer a portfolio of core crossover vehicles with 1 to 2 models for each categorized buyer group. 

Can you think of anything else that you would do the increase crossover sales in the short term and mid term?  How would you categorize the major buyer groups based on lifestyle and usage?  Would you even use different categorization criteria?

I am willing to talk with blog participants live via phone for free consultations.  I am also available to companies, businesses and organizations for consulting engagements and speaking opportunities.  For any of these request, E-mail me .  I will help my readers in any way possible – I want to share my knowledge and expertise.

Mike Bolden marketing expert and blue ocean strategist – writing to inform, enlighten, and inspire.  Author of forth coming book, “Owning Marketspace”.  Available for consulting and speaking engagements.

Detroit Automakers Price Inelastic Price Elastic Blue Ocean Strategy Crossover Sales GM and Ford Turbo Tagger

Counter-Intuitive Locations Will Lead to Bluer Seas
An important way to target groups willing to trade up in price is to locate more stores in demographic areas that have high concentrations of these buyer groups.  While this sounds obvious, the tactics of this strategy for Chipotle’s value proposition are counter-intuitive.  Restaurant industry logic typically clusters competitor outlets in similar and close proximity. Running counter to this logic, Chipotle would be better suited near a mid-range restaurant, rather than near a fast food restaurant. Likewise, it should strategically positioned and pitched as THE “mid-range” option among fine and upscale dining establishments, not the “expensive” place passed by the fast-food strip.

How to Out-Maneuver Three Major Types of Restaurants
For all three of these types of restaurants, the Blue Ocean Value Canvas diverges favorably for Chipotle.  The fast food restaurant will be irrelevant because it won’t be in proximity, the mid-range restaurant will lose twice on price and quality, and the fine dining restaurant will be beat via a trificta of convenience/speed, price, and value.  The trick is that the buyer group who is willing to trade up price for quality will also act as an enabler to create a new restaurant categorization and value proposition. 

Winning Through Strategic Day Part Offerings
Within these demographically-favorable locations and near these up-scale restaurants, Chipotle must continue to target the lunch times and early evening/pre-dinner times. For lunch times, they should stick to their guns of high food quality/minimum service, and focus on value to retain repeat customers. This is particularly important for their restaurants located near corporate corridors and education centers. For evenings, pre-dinner should offer an indirect “flank” to direct head-to-head competition with the fine dining establishments.  During this day part, Chipotle can increase offerings – not necessarily service – by expanding the menu items for higher-end food and maybe even cocktails (they already offer beer).  Can you think of some other types of offering which you think Chipotle could do?  How else do you think Chipotle can expand it Blue Ocean?

I am willing to talk with blog participants live via phone for free consultations.  I am also available to companies, businesses and organizations for consulting engagements and speaking opportunities.  For any of these request, E-mail me .  I will help my readers in any way possible – I want to share my knowledge and expertise.

Mike Bolden marketing expert and blue ocean strategist – writing to inform, enlighten, and inspire.  Author of forth coming book, “Owning Marketspace”.  Available for consulting and speaking engagements.

Chipotle Chipotle Mexican Grill Blue Ocean Value Canvas Blue Ocean Strategy Buyer Groups High Food Quality Turbo Tagger