Most B2B companies regularly conducting market research typically concentrate their focus on developing a deep understanding of three primary areas:
- the market metrics (size and growth, share, etc.),
- the competitive landscape (competitors, strengths and weaknesses, etc.), and
- product and service performance with the current customer base (customer satisfaction, Net Promoter Score, etc.).
While we agree that the information generated by researching these three areas is critical in the creation of a well-developed strategic plan, there is another key area that should be addressed…technology.
Often overlooked by many market research efforts, we believe that now more than ever research needs to include an understanding of how current technology is affecting the market and what new and potentially disruptive technologies are on the horizon. The rapid development, penetration, and global spread of technology on the manufacturing floor, along the supply chain, within service departments or with the overall goal of adding value, makes including technology in market research an imperative.
Developing a unique way to incorporate and use existing technology or deploying new technology can have both a rapid and profound effect in the marketplace. Below are some examples of how technology can drive lower costs or increased value, either of which can be disruptive to the existing market balance.
Cost Improvement – In intensely competitive markets, where pennies can translate into millions of dollars in potential savings, employing technology that can generate a reduction in manufacturing cost can create a measurable competitive advantage. Typical improvements often include the increase of line speeds, material reduction, or a reduction in labor through automation.
Value Add – Product improvement is most often a result of value-added technology in manufacturing. Whether the improvements are generated from new materials, alternative processing methods, or added product features…the added value in a market quite often provides enough differentiation to drive share and/or increase the price.
Cost Improvement – Technology improvements in product and inventory tracking can often provide opportunities to reduce overall inventories throughout the entire supply chain, driving a reduction in overall working capital. This advantage can lower overall cost, therefore increasing the value.
Value Add – One of the most critical pieces of the supply chain is on-time delivery, or in many cases just-in-time delivery. Providing consistent performance in this area can deliver increased value to the customer, or put another way…poor performance in this area can dramatically increase the cost. Missing a just-in-time delivery can shut a customer’s plant down, costing thousands. Employing technology that can dramatically improve delivery performance can be a major source of differentiation, which can change the competitive landscape.
Cost Improvement – Employing technology that can improve service levels at a lower cost is a win-win for both suppliers and clients. I recently reviewed a system that automatically filled canceled doctor’s appointments within 5 minutes. The system keeps the doctor booked, negating the lost revenue due to the cancellation, while the patient taking the newly open appointment time got in to see the doctor much sooner than expected.
Value Add – Some examples of how technology is driving value can be seen in the introduction of smartphone apps into more traditional businesses. Whether improving access to customer service, expediting the ordering process, or providing fast and easy ways to provide critical information, technology provides faster, easier, and more communications options.
In today’s world, technology can not only deliver differentiated cost and service overnight but in some cases can provide a unique competitive advantage and competitive landscape. It is imperative to keep abreast of current technology and how it is being deployed. It is also necessary to understand what new technologies may pave the way for differentiation or even disruption.