Expanding into new markets
One of my favourite strategy tools was outlined by Chris Zook in his book ‘Beyond the Core’ in 2004. It is useful when you are thinking about where and how to expand your business beyond its current markets, products and services. Zook’s tool is shown in summary form below.
It relies, first of all, on really understanding what it is that makes a business successful, what it is that creates its profitable core. The core question is: what are you really good at? Where do you make money and why? What is it that is distinctive about you, the market, and the competition that allows you to succeed?
These questions are not always easy to answer, because businesses are so often so focused on delivery that they hardly give a thought as to why they succeed. Once you have answered the questions about your distinctive core, you can use the eight generic adjacency approaches to brainstorm, outline and consider many more potential options than you might otherwise.
Some of the ideas that come may feel pretty crazy, but don’t kill them prematurely. Let the ideas come – as many as possible – then stand apart and look at each one objectively.
How broad is your thinking about new markets? Are you thinking along the same ruts as ever, or should you be considering expanding your possible future options?