Outline of Chapter 3
Opportunities, especially breakthrough opportunities, come from understanding markets thoroughly.
1. customers who are willing to exchange something of value.
2. a group of potential customers with similar needs.
3. sellers offering substitute/various ways of satisfying customer needs.
Generic market: a market with broadly similar needs and sellers offering various –often diverse --ways of
satisfying those needs. may include sellers who compete in different product-markets;
1. probably be broader than the firm's target market.
2. might be composed of several different product-markets.
3. products from different industries compete for customers by trying to satisfy the same basic need.
4. may have only a tiny market share in the generic market but a large share in its product-market
Ie: sports: skis, roller blades, bicycles, and ice skates.
Entertainment: television, restaurant, movies, bowling, etc.
Seasonings: garlic powder. pepper. tabasco sauce. salt.
Personal Expression: Long-stem roses, Champagne, A greeting card, A telegram
Photo reproduction: digital camera, a computer video-cam, and a computer scanner
Recording devices: A pencil, a dictating machine, and a word processor
Music: transistor radio, an MP3 player, and a portable CD player
Junk food: Popcorn, soda, ice cream, cookies
Should not include competitor’s names.
Product-market: a market with very similar needs and sellers offering physically or conceptually close
substitute ways of satisfying those needs. Must have information about consumer needs, information
about the final customer (or user) of the product, a description of the type of product
Ie: The young adult exercise market
A basic difference between a "generic market" and a "product-market" is how similar the competing
sellers' products are.
NAMING PRODUCT-MARKETS AND GENERIC MARKETS
A complete product-market definition includes four parts:
should meet customer needs