In this article, Blue Ocean for Solopreneurs. Reconstruct Boundaries with Path 3 of Six, we break down path 3 of the six paths framework.
Path 3: Look Across the Chain of Buyers
In most marketing and sales training, you are prompted to develop a buyer persona. The buyer persona will be focused on your opinion or history of who purchases your offering. In the absence of other processes, this a great exercise. Some businesses resist strategic thought about buyer personas.
Blue Ocean Strategy invites the participant to broaden the definition of the buyer.
As a sole proprietor, small business owner, or division leader, there are more possible definitions of buyer than you may realize. When Joann K, a distiller with a growing spirits brand seeks to sell her products to Walmart, she has to sell first to a buyer like Kelvin R, a liquor distributor in Kentucky. He is the one that buys her product and secures placement in Walmart for Joann K, who is one of his suppliers. He has to close that sale with the buyer at Walmart. That buyer’s concerns are governed by price, financing terms, delivery, and supply chain issues. The customer who buys from Walmart is a buyer that ultimately accounts for depletion and necessary reorders of the liquor but their concerns are secondary to the liquor distributor.
Joann has to consider all three buyers as she creates her product. Design, distribution, price, and all other features of the Buyer Utility Map have to be considered.
When you are reconstructing market boundaries, you have to look across the entire chain of buyers. As you do so, you discover alternative buyers that may greatly expand your offering.
Let’s use a real example.
One of my recent Blue Ocean Strategy engagements involved the creation of a global online portal for a specific community of faith. The concept was fairly straightforward. The initial launch would include the upload of tens of thousands of “congregations” or churches into a database that would be reflected as profiles and dots on a global map. Each congregational leader would be invited to come on the platform and take ownership of the data associated with their respective dot on the global map.
Connectivity that was heretofore unavailable outside of secular networks would now be available. As the community launched, the initial buyer was that congregational leader. All efforts were made to identify those individuals and bring those people as “buyers” onto the platform.
Over time, as congregants began to adopt the platform, buyer groups began to appear. How? They began to ask for recommendations, services, and connections. One prominent group was made up of participants who wanted online theology training and certification. The founders of the community recognized this group as a buyer and set about the task of building an online theological institute. Upwards of 200 people now take classes toward their certification. This classic example of matching need with product would not have happened without a blue ocean-inspired willingness to look across buyer groups.
Challenging industry standards and conventional wisdom about which buyer group to target can lead to the discovery of a new blue ocean of uncontested market space.
Who influences the buy decision?
If you’re offering a product or service to a specific buyer group and find your revenue waining or your profits being pinched, what might you do to look across different buyer groups? Who influences the buy decision? Who else, outside your industry may benefit from your offering?
Example: When a couple heads down the path to divorce, divorce mediation and collaborative divorce are now options. Why? The complexity and expense of a contested divorce led to a new buyer group. Couples who didn’t want to deal with the complexity and expense of the contested option. An entire blue ocean industry now exists thanks to someone’s initial willingness to look across buyer groups.
In closing Blue Ocean for Solopreneurs. Reconstruct Boundaries with Path 3 of Six; reconstruct boundaries with path 3 of six, ask yourself.
What is the chain of buyers for my industry?
On which buyer do I typically focus?
If I shifted the buyer group of my industry, how would it unlock new value?
If you’re intrigued by these questions and the blue ocean strategy process, consider learning more about our 2021 Blue Ocean Strategy for Sole Proprietors Mentorship and Implementation Cohort. We’ll take small groups through a 6-month process of blue ocean strategy implementation. To learn more, contact the Blue Ocean Strategist, Sherman Mohr.