By: Jay Deragon, Strategist

Waves That Can

Change the Landscape

What Can A “Wave” Do?

A large wave can be destructive, disruptive,

damaging, forceful and surprising to

those unprepared.

A “Wave” Can Also…

create opportunities to those who know how to ride them.

For Business a “Wave” of Demand is a Good Thing

Demand comes from fulfilling buyer Intents.

Demand comes from creating excellent buyer experiences.

Demand comes from awareness of buyer experiences.

To Create “Waves” of Demand Use A Social Innovation Strategy

The Social “Wave” of Innovation

The Social “Wave” of Innovation

Requires a Different View of the World.

A View from the Buyers Perspective.

Social Waves of InnovationSocial Waves of innovation are created in the region where a market’s actions favorably affect both its cost structure and its value proposition to buyers. Cost savings are made by eliminating and reducing the factors an industry competes on. Buyer value is lifted by raising and creating elements the industry has never offered. Over time, costs are reduced further as scale economies kick in due to the increased relationship that superior value generates. Value comes from social innovation created to enhance buyer experiences.

Supplier Cost

Buyer Value

Social Innovation

Public Relations

Marketing & Advertising

Operations & Culture

Human Resources

On-Line and Off-Line Presence

Connections

Intentions

Presence

Preferences

Social Acumen

Word of Mouth

Influence

Supplier Buyer

Traditional Versus Social “Wave” StrategyIn traditional strategies, differentiation costs because firms compete with the same best-practice principle. Here, the strategic choices for firms are to pursue either differentiation or low cost. In the social wave world, however, the strategic aim is to create new social wave rules by breaking the existing value-chain trade-off and thereby creating social innovation.

Align the whole system of a firm’s activities in pursuit of differentiation through social innovation..

Align the whole system of a firm’s activities with its strategic choice of differentiation or low cost.

Break the value-chain trade-off.Make the value-chain trade-off.

Create and capture new demand.Exploit existing demand.

Make the competition irrelevant.Beat the competition.

Create social innovation models.Compete using existing models.

Social Wave StrategyTraditional Strategy

The Four Principles of Social Wave Strategy

Organizational social assessment

Management of social risk

Market intention risk

Technological risk

Overcome key organizational hurdles

Build social acumen into strategy

Follow the buyers intents

Ignore competition

Risk factor each principleEvaluation principles

Search for cultural risk

Planning to reduce risk

Scale risk into waves of influence

Business model & cultural risk

Remove market boundaries

Focus on the buyer, not the competition

Reach beyond existing media

Get the strategic sequence right

Risk factor each principleFormulation Principles

This figure highlights the four principles driving the successful formulation and execution of social wave strategy and the risks that these principles address.

Strategy WavesThe strategy canvas is both a diagnostic and an action framework for building a compelling social wave strategy. It captures the current state of play in the known market space. This allows you to understand where the buyer is currently investing, the factors the industry currently competes on in products, service, and delivery, and what customers receive from the existing competitive media in the market. The horizontal axis captures the range of factors the buyer follows on and invests in. The vertical axis captures the offering level that buyers receive across all these key competing factors. The value curve then provides a graphic depiction of a company’s relative performance across its industry’s factors of buyer intentions.

High

Low

Price Use of buyer terminology

on-line behavior Media

quality

Buyer influences

Buyer complexity

Buyer

intention ranges

Four Actions Framework + Eliminate/Reduce/Raise/Create Grid

The four actions framework offers an technique that breaks the trade-off between differentiation and low cost and to create a new value curve. It answers the four key questions of what markets take for granted and needs to be eliminated; what factors need to be reduced below market standards; what factors need to be raised above market standards; and what should be created that the market has never offered.

The eliminate-reduce-raise-create grid pushes companies not only to ask all four questions in the four actions framework but also to act on all four to create a new social wave curve. By driving companies to fill in the grid with the actions of eliminating, reducing, raising, and creating, the grid provides four immediate benefits: it pushes them to simultaneously pursue differentiation and low costs; identifies companies who are only raising and creating thereby raising costs; makes it easier for managers to understand and comply; and it drives companies to scrutinize every factor the industry competes on.

Create

Easy access

Ease of interaction

Responsive and personal

Reduce

Message complexity

Media range

Buyer constraints

Raise

Value versus price

Off line involvement

Buyer involvement

Eliminate

Seller terminology and distinctions

Mass Media Messaging

Above-the-line marketing

A Social Value Curve

Reduce

Eliminate Create

Raise

Which factors should be reduced well below market standards?

Which factors should be created that the market has never offered?

Which factors should be raised well above the industry’s standard?

Which of the factors that the market takes for granted should be eliminated?

Four Steps of Visualizing StrategyThe four steps of visualizing strategy builds on the paths of creating social waves and involves a lot of visual stimulation in order to unlock people’s creativity. The four steps include visual awakening, visual exploration, visual strategy fair, and visual communication.

•Distribute your before-and-after strategic “social” profiles on one page for easy comparison.

•Support only those projects and operational moves that allow your company to close the gaps to actualize the new social strategy.

•Draw your “to be” social strategy canvas based on insights from observations.

•Get feedback on alternative strategy canvases from customers, partners’ and noncustomers.

•Use feedback to build the best “to be” future social strategy.

•Go into the field (on & off line) to explore the social paths to creating social waves.

•Observe the distinctive advantages of alternative communications for products and service intentions.

•See which factors you should eliminate, create, or change.

•Compare your business intentions with your buyers’ by drawing your “as is” social strategy canvas.

•See where your social strategy needs to change to match buyer intentions

Visual

Communication

Visual Strategy FairVisual ExplorationVisual Awakening

Wants, Needs, Intention MapA corporate management team pursuing profitable growth can plot the market’s current and planned intents on a wants-needs-intentions (WNI) map. This strategy can help a company determine which buyers experience creates the biggest wave in growth and interaction. These are classified accordingly with the highest growth potential being wants, then to needs, then to the lowest rung, non-buyer intentions.

Buyer wants & needs

Buyer intentions

Non-buyer intentions

Today Tomorrow

Growth comes fromfulfilling buyer and non-buyer wants, needs and intentions

Three Tiers of Non-buyersThere are three tiers of non-buyers that can be transformed into buyers. They differ in their relative distance from and experience with your market. The first tier of non-buyers minimally buy you offering out of necessity. The second tier of non-buyers refuse to use your offerings. The third tier are non-buyers who have never thought of your offerings as an option or have never heard of the offerings.

Your Market

First Tier

Second Tier

Third Tier

Sequence of Social Wave Strategy

An important part of social wave strategy is to “get the strategic sequence right.” This sequence fleshes out and validates social wave ideas to ensure their commercial viability. This can then reduce business model risk. In this model, potential social wave ideas must pass through a sequence of buyer value, accessibility, attention, and adoption. At each step there are only two options: a “yes” answer, in which case the idea may pass to the next step, or “no”. If an idea receives a no at any point, the company can either park the idea or rethink it until you get a yes.

Is there exceptional buyer value in your business idea?

Buyer Value

Is your value easily accessible to the mass of buyers?

Accessibility

Can you attain a social wave of buyer attention to your value proposition?

Attention

What are the adoption hurdles in actualizing your social wave? Are you addressing them up front?

Adoption

A Commercially Viable Social

Wave Idea

No-- Rethink

Yes

Yes

Yes

Yes

No-- Rethink

No-- Rethink

No-- Rethink

Buyer Value MapThe buyer utility map helps managers look at this issue from the right perspective. It outlines all the levers companies can pull to deliver exceptional value to buyers as well as the various experiences buyers can have with a product or service.

1.

Value

2.

Accessible

3.

Useful

4.

Meaningful

5.

Relational

6.

Social

Customer Productivity

Simplicity

Convenience

Risk

Fun and Image

Environmental friendliness

The Six Stages of the Buyer Experience Cycle

Th

e S

ix V

alu

e L

ever

s

Buyer Experience CycleA buyer’s experience can usually be broken into a cycle of six stages, running more or less sequentially from value to social. Each stage encompasses a wide variety of specific experiences. At each stage, managers can ask a set of questions to gauge the quality of buyer’s experience.

Value Accessible Useful Meaningful Relational Social

Define the buyers attributes of value.

What does accessible mean to the buyer?

How does the buyer define useful?

What would make the experience meaningful?

What experience attributes create a sense of relational intents?

Can the buyer share their experience with friends?

Uncovering Blocks to Buyer ValueUncovering blocks to buyer utility can identify the most compelling hot spots to unlock exceptional utility, social value. By locating your proposed offering on the thirty-six space of the buyer utility map, you can clearly see how, and whether the new idea not only creates a different utility proposition from existing offerings but also removes the biggest blocks to utility that stand in the way of converting noncustomers into customers.

SocialRelationalMeaningfulUsefulAccessibilityValue

In which stage are the biggest blocks to environmental friendliness?

In which stage are the biggest blocks to fun and image?

In which stage are the biggest blocks to reducing risks?

In which stage are the biggest blocks to convenience?

In which stages are the biggest blocks to simplicity?

In which stage are the biggest blocks to customer productivity?

Environmental

Friendliness:

Fun and Image:

Risk:

Convenience:

Simplicity:

Customer Productivity:

Intention Model of Social Wave StrategyThe intention model of social wave strategy shows how value innovation typically maximizes buyer experiences by using the three levers of strategic value, buyer value, and pricing innovation.

The Strategic Value

The Buyer Value

The Value Cost/Benefit

Streamlining and Social Innovations Partnering

Pricing Innovation

Social Wave Idea IndexThe social wave idea index is a simple but robust test demonstrating how the sequence of value, accessibility, attention, and adoption form an integral whole to ensure commercial success through social wave strategy.

Have you addressed adoption hurdles up front?

Adoption

Does your message have reach, richness and social referrals?

Attention

Is your offering easily accessible to the mass of buyers?

Accessible

Is there exceptional value? Are there compelling reasons to buy your offering?

Buyer

Value

OfferingA

Offering B

OfferingC

- -

-

-

-

-

-

+

+

+

++/-

Do You Have a Social “Wave” Strategy?

If you don’t the swelling wavein the distance may disruptyour business landscape

permanently..

Do You Have a Social “Wave” Strategy?

If you do then you are in a good position to capture the disruptive

nature of a large wave.

Doing so means you’re the one changing the landscape.

A Social Wave Strategy….

will enable you to prepare and ride the “wave” of changes on the horizon caused by the

advancements in social technology.

Advancements yet to be discovered but forming in the distance.

A Strategy for Meeting

The Social Waves of Intent.

By: Jay Deragon, Strategist

jay.deragon@gmail.com