Phases of Competition: Customer

UNIT 4
Phases of Competition
Customer
- The customer is absolutely key to successful entrepreneurship, but nevertheless,
some entrepreneurs make the mistake of taking their eye off the customer.
- Without customers there is no business. Your business has to provide customers
with a valuable product or service at an acceptable price.
- Customer validation of your idea for a new product or service is crucial and there
are some very useful tools available for doing that in a systematic fashion. One such
tool is an experiment board or validation board.
- See? Say? Hear? Feel? Think? Do?
Meaning
- Value of the product
UNIT 5
Design Thinking
- Design thinking focuses on the customer and, crucially, it also focuses on meaning.
Steps in Design Thinking
Step 1: Empathize
- To figure out what the customer‘s problem is.
a. You can go out and ask the customer
b. You can imagine what the customer wants.
Step 2: Define
- You do this based on the insights you gained from talking with prospective
customers. Your goal is to figure out – based on what customers have told you –
what is the ACTUAL problem.
Step 3: Ideation
- This means brainstorming ideas for how to solve the problem you‘ve just defined.
Stay focused on just this one problem. But try to come up with lots of ideas. Now
sketch up your best ideas and show them to prospective customers. Your sketches
don‘t need to be perfect, just enough to explain what your idea is about.
Step 4: Prototype
- You will probably select an idea that seemed to be well received by the
prospective customers you talked to. Good ideas often combine something that is
already being used with a novel idea. And don‘t forget to ask yourself what meaning
the product or service can create
Step 5: Testing or Validation
- This is where you take your prototype product or service to prospective
customers and ask them to try it out. Just like in the first step, where you
went out and talked to customers, you want to stay objective and allow
people to express their true reactions to your prototype.
Lean Startup
- Continuous innovation
- The whole point of entrepreneurship is testing and learning faster than your
competitors.
- The core idea behind the lean startup movement is to avoid spending a
bunch of money and time on something that may well fail when you try to
sell it.
Three steps of lean startup method
Step 1: Build
- Fourth step of design thinking, prototype
Step 2: Measure
- Fifth step of design thinking, testing or validation
Step 3: Learn
- Either go forward with your idea, which might involve building a better prototype,
or you adjust your idea.
UNIT 6
Effectuation
- Using what you have to develop a solution
- What you have available will at least partly define the goal
- Requires creativity and the ability to see possibilities
Causation
- You start out with a goal and then decide what you need to get there
Open Innovation
- That means involving people or companies outside of your company in your
development
Co-creating
- Co-creating with customers is a commonly used method that involves asking
customers to help you develop a product or service that you then hope these
customers will buy.
- Involving customers in the development of new products or services in active
roles.
- Seen as being in line with customer orientation and with the growing trend of
customer empowerment
Effectiveness of co-creation depending on new product radicalness and whether

new products are radically new in terms of utilitarian functionality or in terms of
hedonic qualities
- The research indicated that co-creation contributes positively to market success

when utilitarian radicalness is high – meaning that there is radically new technology
or functionality – but negatively when utilitarian radicalness is low.
- When hedonic radicalness is high – which means that the product will deliver a
radically new meaning for customers – co-creation contributes negatively to market
success, but when hedonic radicalness is low, the contribution is positive.
UNIT 7
9 Components of Business Model

1. Value proposition
- Crucial part of every business model canvas.
- Where you describe the value that your customers will gain from your product or
service
CUSTOMER COMPONENTS
2. Customer Segment
- It‘s usually better to start out with one well-defined customer segment rather than
starting out with the idea of serving multiple customer segments
3. Channel
- How you can get this value to the customer
- In deciding on channels you should think about where your customers are likely to
want to buy and where they are likely to be
4. Customer Relationships
- You need to make choices about the level of personal assistance you need to offer
versus self-service or automated services.
OPERATIONS COMPONENT
5. Key Activities
- These are the activities that you, or your company, needs to do to deliver the value
proposition to your customers through the desired channels and based on the
customer relationships you put in place.
6. Key Resources
- What resources do you, or your company, need to have to be able to deliver the
value proposition to your customers through the desired channels and based on the
customer relationships you put in place.
- Human resources, intangible resources, financial resources
7. Key Partners
- Partners might allow you to reduce costs and streamline your operations.
- Partnering might help you reduce risk and uncertainty.
- Partners might have resources you don‘t have and can‘t get or the ability to
conduct activities that you can‘t.
8. Cost Structure
- The costs inherent in your business model. What do your key resources and your
key activities cost? What do your partnerships cost? What does it cost to maintain
your customer channels and your customer relationships?
- You need to take into account fixed costs such as salaries, rent, utilities,
connectivity, etc. You also need to account for variable cost such as the costs of
developing new products and services.
9. Revenue
- This is all about money coming in. First you need to consider what value your
customers are really willing to pay for and how they would prefer to pay for this
value.
UNIT 8
Commercialization
- Finding ways to market and sell your product or service.
4 Ps of Marketing
1. Products or Service
- Satisfies a need or want
2. Price
3. Place
- Putting the product or service in a place where people will buy it
4. Promote
Core question of marketing

- This question used to be about how sellers could sell. But, more recently, the
question is more about helping buyers to buy.
- Customer power is increasing in the digital age: Customers demand relevant
information when they need it, anytime 24/7.
- Customers can share experiences, compare and rate products and services online.
Four areas of customer demands

1. People want to be able to buy and use your product or service whenever or
wherever they want
2. People want the information you provide in your marketing to add value and
meaning to your product or service.
3. People want a product or service that is personalized to their particular needs and
wants.
4. People want it to be very easy to buy and use your product or service. So don‘t put
them off by making things complicated.
Social media
- Has become a part of everyday life for millions of people. Businesses are eager to
find ways to leverage social media in the innovation process,
Big Data
a. Structured Data
b. Unstructured Data
- The growth of big data has led to intense growth in the demand for sophisticated
data analytics
Steps of the decision-making process followed in making a purchase

1. Customer recognizes a problem or need
2. Customer searches for information
3. Customer sets out and visits a few shops giving out the products or service
4. Customer makes a decision for a specific brand and model of the product and a
place to buy them
5. Evaluate the product

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UNIT 4

Effectiveness of co-creation depending on new product radicalness and whether

- The research indicated that co-creation contributes positively to market success

9 Components of Business Model

Core question of marketing

Four areas of customer demands

Steps of the decision-making process followed in making a purchase

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