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Chapter 5

HEIP 144 Chapter Notes - Chapter 5: Switching Barriers


Department
Entrepreneurship and Innovation
Course Code
HEIP 144
Professor
Jay Smith
Chapter
5

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Discovering New Points of
Differentiation
Most profitable strategies based on this
Companies can differentiate at every point where it comes in contact with customers
Consumption chain: customer’s experience with a product or service
If companies open creative thinking to consumption chain they can uncover new
opportunities
Mapping the consumption chain
Assemble groups from different areas of the company
Especially those in contact with customers
Identify steps through which customers pass from becoming aware of product to
dispose or not using it
Every product will have a different consumption chain
How do people become aware of the need for the product/service?
Differentiate an everyday consumer product
Makes customers aware of a need that had gone unrecognized in the past
How do consumers find your offering?
Must make product available when competitors are not
Must make product ubiquitos
Must offer product in places competitors do not
Make search process:
Complicated
Convenient
Less expensive
More habitual
Must allow consumer to tailor search experience to needs
How do consumers make their final selections?
Narrow down possibilities
Selection process must be comfortable
Encourage people to come to your business through selection process
Selling is not done by the salespeople but by the selection process the
cusomers create for themselves
How do customers order and purchase your product or service?
Connect customers directly to the company system
Allow direct drop shipment
Allow automatic restocking
Benefit of differentiaion is that it imposes a switching cost
Expensive to swithc, creating a deterrant to competition
How is your product or service delivered
Affords many opportunities for diferentiation
What happes when our product or service is delivered?
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