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  • Defining The Focal Market: Professor Ethan Mollick @emollick

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    Ridhya Mahajan
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    This document discusses how to define a focal market by understanding market adoption curves and identifying early adopter "beachhead" customers. It explains that the market follows an S-curve as different customer groups adopt over time from innovators to early adopters to early majority and late majority. Founders should analyze which customer segment is in the beachhead position based on their openness to new ideas, ability to reference other customers, opportunities for learning, and coherence with the business strategy. Choosing the right early adopters helps guide product development and facilitates broader adoption across the S-curve.

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    This document discusses how to define a focal market by understanding market adoption curves and identifying early adopter "beachhead" customers. It explains that the market follows an S-curve as different customer groups adopt over time from innovators to early adopters to early majority and late majority. Founders should analyze which customer segment is in the beachhead position based on their openness to new ideas, ability to reference other customers, opportunities for learning, and coherence with the business strategy. Choosing the right early adopters helps guide product development and facilitates broader adoption across the S-curve.

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    © All Rights Reserved
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    175 views10 pages

    Defining The Focal Market: Professor Ethan Mollick @emollick

    Uploaded by

    Ridhya Mahajan
    This document discusses how to define a focal market by understanding market adoption curves and identifying early adopter "beachhead" customers. It explains that the market follows an S-curve as different customer groups adopt over time from innovators to early adopters to early majority and late majority. Founders should analyze which customer segment is in the beachhead position based on their openness to new ideas, ability to reference other customers, opportunities for learning, and coherence with the business strategy. Choosing the right early adopters helps guide product development and facilitates broader adoption across the S-curve.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
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    DEFINING THE FOCAL MARKET

    Professor Ethan Mollick


    @emollick

    WHARTON ONLINE Entrepreneurship


    Thinking through focal markets

    • Approach from Gans and Stern


    – Understanding the market s-curve
    – Identifying beachhead customers
    • Knowing when to enter the market

    WHARTON ONLINE Entrepreneurship


    Market segments

    WHARTON ONLINE Entrepreneurship


    The Market S-Curve Results from Differences Across
    Potential Adopters
    Adopter Group Characteristics Value Creation Drivers
    Innovators Adoption for adoption’s sake; Cool Technology; Ability to
    willing to work with bugs “Experiment”

    Early Adopters Application enthusiasts; Seeking a The Ability to Gain an


    Revolution; Demanding but Advantage from the New
    Collaborative Product; Having the Product
    Before Others
    Early Majority “Main Street”; Seeking Evolution Demonstrated ROI; “Plug-and-
    from an Existing Solution; play”; low transition costs;
    Persuaded by Similar references; requires standardized support
    Late Majority Well-served by existing solutions; Willing to Adopt the “Minimum”
    Seeks commodity technology Required; Only Adopts Because
    Others Have
    Laggards Willing to pay a cost not to adopt Zero?
    resistant to technology adoption

    Source: Gans and Stern


    WHARTON ONLINE Entrepreneurship
    It also tells you about strategic challenges

    Early Adopters Early Majority


    Want to change the game Wants proven solutions
    Chasm
    WHARTON ONLINE Entrepreneurship
    Chose your customers: S-Curves

    • What are the beachheads?


    • Where are the lead customers on the adoption curve?

    Late Early Early Late


    Majority Majority Majority Majority
    Early Early
    Adopters Adopters
    Laggards Innovators Innovators Laggards

    Time Time

    Source: Gans and Stern


    WHARTON ONLINE Entrepreneurship
    Chose your customers: entrepreneurial sales strategy
    Referencing: Learning: Coherence: Does
    Does this Does this this beached “fit”
    beachhead beachhead with your
    facilitate follow- generate entrepreneurial
    Potential on segments? opportunities for strategy?
    Beachheads further learning?

    Source: Gans and Stern


    WHARTON ONLINE Entrepreneurship
    S-Curve also suggests strategy

    New product
    Improved product Re-segment
    WHARTON ONLINE Entrepreneurship
    Deciding which segment to go after

    • Where on the S-curve?


    • Are they referenceable, valuable for learning, and coherent?
    • Do they match development of the overall market?

    WHARTON ONLINE Entrepreneurship


    WHARTON ONLINE Entrepreneurship

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