Bowmans Strategic Clock Explained

############################# Video Source: www.youtube.com/watch?v=HMRJ8bFt5AU

Bowman's Strategic clock (or strategy clock) is about understading the position a company/product/brand can take place in the market. THere are two dimensions for judging the positions. They are - Price and Perceived Value. • • Patreon Link: https://www.patreon.com/user?u=36571443 • • There are Eight distinct positions that are discussed in here. They are - • 1. Low price Low Added Value • The perceived value in the mind of the potential customers is low. And the price is also low here. In order to be competitive, companies in this position need to provide the lowest possible prices compared to the competition. • 2. Low Price • Here, the perceived value in the mind is medium, but the price is low. • Why would companies charge low prices, well, if they charge low, the customers will buy more. • Their goal is to be the low cost leader of the market. That is why. And, the most likely case is that their profit margin per unit is not a lot. But, if they sel a lot of products, the overall profit margin will increase. • And now, how? Economies of scale. Remember it is about the perceived value. The companies can take advantage of mass production to reduce their overall cost. • • 3. Hybrid • Hybrid generally means the mix of somethings. • And you can clearly see the mix in the graph. The perceived value is pretty high. but the price is low. • The companies going for this strategic position are going to try and offer some level of differentiation to their customers. • Their products or services are going to be different in some ways than their competitors. And they are still going to charge low prices. Customers love them, competitors hate them. And if competitors can copy their unique selling proposition somehow, they are not going to be at this stage anymore. • But, it is going to be pretty profitable for the company if they can keep providing the differentiated product or service. • • 4. Differentiation • The aim of the company is to provide differentiation to the customers. And they are going to charge average prices. Not the lowest, not the highest. • In order to pull this off, they do need good product or service quality. And a strong loyal customer segment. Otherwise they cannot pull this off in the long run. But, if they can evoke loyalty in a group of people with an above average offering, this strategic position is quite good. • • 5. Focused Differentiation • Highest price level with a high perceived value. These are the luxury items. • They are also highly targeted. You are not likely to get an youtube ad about an island for sale. If you do, comment below. • Premium pricing for the premium value. Premium perceived value. • • 6. Risky High Margins • These companies are charging the premium price, but, the perceived value in the mind of the customers is mediocre. • They have to move on from this place because it is not sustainable. Customers are not going to stick with a company like this if they find another alternative to this one. • • 7. Monopoly Pricing • The name tells us that there has to be a monopoly for a company to pull this off. • The perceived value is low, but the price is high. • Companies do go for monopoly pricing when they see that there are absolutely no competition for them. • • 8. Loss of Market Share • Here, the companies are charging more than the competition, without offering anything better than the competition. That is not the best strategy to have. • • My Gear Past,Present, and Future: [Affiliate Links: If you purchase the items below by clicking on the links shown here, I will get a small commission from it. Consider this another way of supporting the channel.] • First Recording Device (Headphones): https://amzn.to/3o0IjRj • Second Recording Device (Lavalier Microphone): https://amzn.to/31o4LtU • Current Recording Device: https://amzn.to/31m59Jh • Microphone Filter: https://amzn.to/37kTHRS • • What I Plan To Use In The Future - • Drawing Tablet: https://amzn.to/3nVpGht • Backup Drive: https://amzn.to/3jdobYe • • Timestamps: • Intro To The Strategy Clock - 0:00 • Low price low added value - 1:23 • Low Price - 2:00 • Hybrid - 3:10 • Differentiation - 4:09 • Focused Differentiation - 4:49 • Risky High Margins - 5:32 • Monopoly Pricing - 6:05 • Loss of Market Share - 6:50 • Bonus - 9:05 • Conclusion - 10:03

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