PR or first-past-the–post?

Tony

Friday, May 7, 2010

Product strategy needs to recognise that market behaviour is more akin to first-past-the-post than to Proportional Representation.  More akin to Cup football than to Formula 1.

Don’t panic, I’m still not going to talk about politics (see my previous blog).

I spend a lot of time with technology companies, most of whom think that their technology is wonderful (it usually is), and many of whom spend ages trying to optimise it.

 

It is a well-known discussion that technology companies need to turn their technology not only into proper products, but also into proper solutions to real customer problems.

 

It is also well-known that different customers have different problems, and require different solutions.  Hence the importance of market segmentation.

 

There is a real danger that if a company tries to please everybody, rather than focussing on serving some segments really well, it may come out near the top of every purchase decision, but not quite at the top of any of them.  Thereby winning no business.

 

By finishing second in every race in Formula 1, however, a driver can do very well in the championship race, and can even in principle become World Champion, if the other drivers share the wins between them.

 

Similarly, in a Proportional Representation system, if you do reasonably well, you will win a reasonable number of seats. 

 

 

  

By finishing second in every purchase decision, a company gets zero income.  In business, you need a strategy of winning some contests and ignoring some, rather than doing reasonably well in lots of them.

Similarly, you don’t win the FA cup unless you win every game you play.

 

And in today’s first-past the post electoral system, you need to win constituencies in order to get seats in parliament. 

- Tony

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