0905

Problem

In many markets, a new entrant might consider a strategy that provides potential customers with a product or technology that is “good enough” rather than “superior” to existing options. Describe the key tests that a disruptive strategy must pass in order to stack the odds for success in its favor.

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Step 1/3

Key Tests- To be successes a disruptive strategy must pass the following key tests:

• Low- End Strategy Test- There should be potential customers at the lo- end of the market who wants to buy product or service which is “good enough” rather than “superior” to existing products or services if they can get it at lower or discounted price.

Targeted customers of low- end disruptive strategy are those customers who want to buy a good product but either at lower or discounted price.

Step 2/3

• New Market Disruptive Strategy- Targeted customers are non-consumers i.e. those customers who were not able to buy products because of money and use them because of lack of skills.

Existing customers cannot use the product or service at their doorstep they have to go to some other place to use the product or service.

Step 3/3

• Final Critical Test- The innovation should be disruptive among all the major competitive firms in the industry.

If any of the competitive firm will be working on the same idea then the disruptive strategy will not pass in order to stack the odds for success in its favor.