In order to survive and thrive in the long run, every company needs to think about how to create more value. In principle, there are several avenues for generating value:
In 2020, my colleague Rita Zehetner published a blog article, where she provides a step-by-step framework on how to grow in existing and into adjacent markets. In her article, she argues that entering completely new markets poses a very high risk of failure.
However, there may be situations where the biggest innovation potential lies exactly in these white spaces, the uncharted terrain of new markets. Even if it is difficult to identify, assess and capture totally new markets, I am convinced that it is possible, and that ODI offers the right tools to do so. Let’s approach new markets by tackling the following three questions:
While in existing markets the focal point is on the job that job executors are trying to get done, we have to take a higher perspective when addressing totally new markets. Here the challenge is to identify all possible jobs-to-be-done in a certain area. We suggest to do this by creating a so-called “Job Inventory”.
The Job Inventory can be approached in two ways: Generally speaking, innovators may start out from a technology or a group of people when thinking about a new market. Starting with a technology in mind, possible new markets are identified by considering jobs that the technology in question could address. If you start with a group of people in mind, the resulting job inventory will comprise all kind of jobs these people are trying to get done.
Once a broad Job Inventory is created, the next step is to use clustering and correlation analysis to consolidate the information, and identify topics that cover as many jobs as possible.
See how this approach was employed by a mixed team of Jobs-to-be-Done Innovation Strategists and the New Business Development team of a leading daily media company. Existing users of daily media products were asked what jobs, tasks, and objectives they seek to address in their daily life related to a media product. This generated a long list of jobs-to-be-done, which were then quantified in a large-scale survey. The simple question of that survey was: How relevant is that specific job, task or objective on a quantitative scale? A statistical clustering and correlation analysis revealed seven major jobs-to-be-done that translated the original long list of tasks into a reduced set of jobs (e.g., “stay conversant in a popular topic”) that could then be used as jobs-based market definitions for that media company (see picture below “Why do people hire a daily quality newspaper?”).
Evaluating the attractiveness of completely new markets is the next challenge. Knowing market opportunities is not enough, internal criteria such as (core) competencies or strategic directions have to be considered as well. Therefore, it is even more important to proceed systematically, to define each market in the same way and to use the same criteria for evaluating market attractiveness.
Our partner Strategyn has developed a Market Selection Tool for this purpose, which you can download on their website. The Market Selection Tool includes more than 40 unique criteria to consider when evaluating which market to pursue. These criteria are, for example, the size and growth rate of the job executor base, the frequency of job execution, the percent of underserved customers, the willingness to pay more to get the job done better, but also company-internal criteria like feasibility with current capabilities or organizational aspects.
Once the most promising market has been selected and defined through the Jobs-to-be-Done lens, the procedure from here on does not differ from that in existing markets. Now we reduce our flight altitude again, to take a closer view at under- and overserved needs in that market by using Outcome-Driven Innovation® (ODI).
However, when tackling a new market, there is a high probability that not all the necessary resources and competencies are available in your company. If this is the case, consider creating an ecosystem of partners who combine their strengths to better serve the customer’s job-to-be-done. To that end, check out our blog on creating an innovation ecosystem with the Jobs-to-be-Done framework.
In a nutshell, the advantages of Outcome-Driven Innovation® (ODI) – consistent customer-centricity, data-base and the systematic approach – are as helpful for identifying totally new markets as they are for existing markets. Let’s set off together for new shores!
What about your experience in growing into totally new markets? Should you have feedback or questions, just drop me a line:).
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