This document discusses differentiation strategies for businesses. It begins with an introduction to Mark Tapley, a consulting firm that helps Ukrainian companies with business challenges through professional development events, research, and consulting. It then discusses Porter's generic strategies of differentiation and cost leadership. The main part of the document explains the 3V model of differentiation consisting of a Valued Customer, Value Proposition, and Value Network. It provides examples of analyzing customers and attributes to identify differentiation opportunities. The document emphasizes tailoring offerings to meet customer needs better than competitors.

1. Leading through
differentiation
Antonina Armashula
Co-founder, Marketing Director
Mark Tapley
Copyright © Mark Тapley, 2009
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2. INTRO. ABOUT ME
Copyright © Mark Тapley, 2009
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3. INTRO. ABOUT MARK TAPLEY
We help top managers of Ukrainian companies solve their
business challenges by integrating global expertise into
their everyday work.
Professional development events
Benchmarking research
Consulting
Marketing and Sales
HR and People Skills
Corporate Performance Improvement
Information Management
Copyright © Mark Тapley, 2009
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4. INTRO. OUR CLIENTS
Copyright © Mark Тapley, 2009
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5. PORTER GENERIC STRATEGIES
Market segmentation
Cost leadership Differentiation
Copyright © Mark Тapley, 2009
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6. DIFFERENTIATION
Process of distinguishing a product or offering from
others, to make it more attractive to a particular
target market.
Demonstrating unique aspects of a firm’s product and
creating a sense of value.
Must be valued by BUYERS
Need to differentiate from competitors’ products as
well as firm’s own.
Copyright © Mark Тapley, 2009
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7. 3V MODEL
London Business School, N.Kumar
Valued Customer
Value Proposition
Value Network
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8. 3V. VALUED CUSTOMER
Strategic segments that
require changes in the
company, not just
marketing mix
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9. VALUED CUSTOMER. EXAMPLE
Large enterprise
Have experience, trust and culture
for investing in employees’
development
Have budget fro trainings,
consulting
Consider educational events part
of compensation or motivation of
staff or partners
Events are the major
communication channel with
clients
Copyright © Mark Тapley, 2009
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10. VALUED CUSTOMER. EXAMPLE
Basic Active
Usage Green field Competitor #2
Influence Popular guy Friends
Buyer Together with parents Self
Payer Parents (60%) Parents (40%)
Criteria Functional, Price limit Price to peers, Image
3 year position in Strong Weak
segment
Age 10-18 8-30
Town size Less than 20K More than 20K
Idol Big city students ?
Other comments Regional offers? Heavy VAS users
Wallet share possibly bigger
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11. AIRLINES. CUSTOMER SEGMENTS
Business travelers (company pays)
Entrepreneurs (self-paid)
Vacationers (self-paid)
Family-related (depends)
Copyright © Mark Тapley, 2009
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12. 3V. VALUE PROPOSITION
Offer that describes the
quantifiable benefits
that individuals or
organizations making an
offer promise to deliver.
Its development is based
on a review and analysis
of the benefits, costs
and value that an
organization can deliver
to its customers.
Copyright © Mark Тapley, 2009
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13. TO PUT IT SIMPLY
PRODUCT + SERVICE + PRICE + ATMOSPHERE +
SMILE + EMOTIONS… =
EVERYTING THAT CLIENT RECEIVES WHEN
MAKING A PURCHASE
Copyright © Mark Тapley, 2009
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14. EASYJET CASE
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15. ATTRIBUTE ANALYSIS
1. Isolate a relevant point-of-difference between you and
one key competitor
2. Identify a single customer solving a specific problem
3. What is worrying the customer?
• Costs, time, travel, risk, storage, handling,
downtime, parts and supplies, training,
productivity, replacement
4. What are you good at?
5. What are you bad at?
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16. ATTRIBUTE ANALYSIS
Important So-so Not
Food
Safety
Connections
Departure time
Frequent flyer program
Price
Close to city
Internet access
Duty free
…
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17. FOUR QUESTIONS
1. Which attributes that our industry takes for granted
should be eliminated?
2. Which attributes should be reduced to below
industry standards?
3. Which attributes should be increased to above
industry standards?
4. Which new attributes should be created that the
industry has never offered?
Kumar N. “Marketing as strategy”
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18. Performance
Customer benefits Low Med. High
–
Safety
–
1. __________________
Punctuality
2. __________________
Low price
3. __________________
Comfort
4. __________________
Convenience
5. __________________
Frills
6. __________________
Miles
7. __________________
Destinations
8. __________________
_________________
9. __________________
10. __________________
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22. EXAMPLE: XIAMETER
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23. DIFFERENTIATION VS CANNIBALIZATION
The share of a
product increases
when it is the
intermediate
option but
decreases when it
is an extreme
option
Tall Grande Venti
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24. OPT-IN VS OPT-OUT
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25. PSYCHOLOGY AND COMMUNICATION
Value +
Losses $2,500 cash back
Cash back is more
valuable than a price
reduction.
Value -
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26. 3V. VALUE NETWORK
How to deliver our
offer to our client at
a profit
Copyright © Mark Тapley, 2009
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27. EXAMPLE: EASYJET
Decreasing variable costs
Unbundled the offer, eliminating services or reducing performance to
No free food or drink, lower secondary airport fees, lower commissions
with direct channels, no printed ticket costs
Decreasing fixed costs
Low-cost headquarters, young staff, outsourcing, single plane type (1st
time purchasing, training costs), cost-saving culture
Generating additional revenue
Volumes via making fixed costs ‘sweat’
More daily flights via quick plane turn-around times: Boarding (no
seat assignments), secondary airports (less congestion), point-to-point
(no waiting for connections), one plane type (inter-changeable pilots
& attendants, spare parts, technical service), early check-in
requirement, staff in-flight cleaning, pilot culture, no kitchen
More seats (no business class, no kitchen, minimal leg room)
Price discrimination (dynamic pricing)
Ancillary revenues (food, insurance, car rentals, etc.)
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29. СПАСИБО!
www.marktapley.com
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