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Table of Contents

Growth and Competitive Strategy in 3 Circles, v. 1.0

by Joel E. Urbany and James H. Davis

6.6 Chapter Summary

Let us summarize the chapter’s key concepts by returning to the Kindle example from Chapter 5 "Sorting Value". What are the implications of the growth strategy framework for Kindle’s possible outlets for growth? We can get some initial speculative insight—subject, of course, to the need for additional research.

  • Kindle’s Area A: Kindle’s positioning as a dedicated electronic reader is very clear, as it was essentially the pioneer. Its features build to the core benefits of focused reading and undistracted immersion, as well as inexpensive access to books.
  • Imperative 1: Correct deficiencies. There may be some borderline deficiencies here, particularly related to navigation. While the system moves relatively quickly, the difficulty of using the tiny joystick can be frustrating both in terms of speed and accuracy of navigation.
  • Imperative 2: Solidify and update Area B. If book selection is currently roughly equivalent (and limited) between Kindle and iPad, then this may be an area we can expect differences to emerge because it is both important to customers and a function of building and shifting partnerships with publishers, which could quickly add access.
  • Imperative 3: Neutralize Area C. There is, of course, some overlap here with Imperative 1. We designated navigation as more of a deficiency because it has an immediate, potentially dissatisfying effect in simple operation of the device. Related, but perhaps not as immediately urgent, is the availability of touch-screen technology and color. The point here is not simply to mimic the iPad but to enable design changes that will improve the user experience for the focused purpose. It is conceivable that no changes should be made regarding the Kindle navigation if most users perceive minimal effects on the user experience or if such changes reduced the speed of the device.
  • Imperative 4: Reduce and eliminate nonvalue. Since the Kindle is already believed to have value because of its simplicity and single purpose, it is fair to suggest that there may be few areas in which to reduce the reading-focused capability. However, it is important to note the mantra of “keeping Kindle simple” is strategically very important, as there may be temptation to gravitate toward greater capability.Brown (2010, January 28).
  • Imperative 5: Build and expand Area A. To be selective here, we will focus on an Area G item that is important to readers, particular on niche genres or topics. Collectively, readers demand a large book selection. Currently, each competitor in the eReader market is limited to a select number of publishing relationships. Blogger Damon Brown (cf. note 16) offers the following advice:

There are hundreds of medium-sized (or smaller) publishers available within and outside of the United States. Amazon wisely is going after the smaller guys, too, with its recent royalty (and rights!) heavy contract option appealing to self-publishers, a group Apple didn’t acknowledge (during a keynote address).

The development of reading-related applications and more extensive study, which allowed the sizing of benefit and interest segments in the reading market, could be important vehicles for reaching readers more effectively than Apple does.

The importance of the 3-Circle framework is that it allows a systematic walk-through of the dimensions of value currently available on the market and a rigorous review of growth strategy questions with emphasis on all the important value dimensions in the market (but current, known dimensions and those not so well known). The goal is to stay focused on how our organization might build a unique position by developing important value for customers that competitors cannot match. A critical issue in this is the notion of capability—once we develop ideas for building growth strategy, how do we execute them? Capabilities, resources, and assets are the focus of the next chapter.