A Simple Market Focus can be a Powerful Advantage

Customer Value cartoonToo many companies merely give lip service to focusing on the market and customers. A real market orientation involves offering more customer value due to an outstanding understanding of the customer and competitors that permeates the organization.

Based on 9 years of data, Kumar et al find that ‘market orientation has a positive effect on business performance in the short and the long run.” It can take some time for the market orientation to have a positive effect, so management needs to provide support. At the beginning of the 9 year period, a company with a market orientation had an advantage. Later on, the nature of competition changed and a market orientation was necessary to compete successfully. Still, the study finds that under highly competitive pressure, a company can gain advantage with a market orientation.

At a multi-million packaging company, I led the shift from a product to a market focus. Initially, the company produced the plethora of products the equipment could produce. As a result, the company was mediocre in most markets, and poorly performing in some, having suffered a significant loss the previous year. I coached the management team to explore market options, utilizing the extensive knowledge in Sales, Production and market analyst assistance.

Given the company’s sophisticated capabilities, market trends and the high margins, we selected the high end market segment as an area of focus, shedding the high volume, low margin product lines. The company pulled together to pursue high quality packaging accounts and to move into a new, higher end product line. The new business added considerable profits to our bottom line, returning the company to profitability.

Over a dozen more options for competitive advantage are discussed in the article “14 Sources of Competitive Advantage.” The article is not only based on extensive experience but also includes considerable research and data on each option.


Tove Rasmussen, your partner in business growth @ Partners Creating Growth, offers business expertise worldwide to help organizations grow, and disadvantaged regions thrive.  Tove@PartnersCreatingGrowth.com


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