Digitize to combine or replace an existing consumption chain. For instance, CarsDirect.com digitized the car buying experience.
Make some links in the consumption chain smarter. RFID tags from Texas Instruments allow ExxonMobil consumers to pay for gas without having to swipe a credit card or pay cash.
Monopolize a trigger event. Elevator companies invested in technologies to provide early warnings of events that might trigger a maintenance call.
Dramatically improve positives. Proctor & Gamble re-engineered the electric toothbrush to make it affordable.
Break up existing segments. Retailer Hot Topic re-segmented a portion of the market for apparel, accessories, and clothing by focusing entirely on young men and women aged 12 to 22 with a passion for music-licensed and music-influenced clothing and other items.
Infuse the offering with empathy. Hot Topic has a retail concept, Torrid, with clothing for young obese women who felt ignored by existing providers.
Eliminate complexity. A hotel chain, Extended Stay America, stripped down its services, substituting daily housekeeping for amenities like kitchenettes, and lowered prices.
Capture the value you deliver. Standard & Poor now charges the companies it rates for the ratings that help them raise capital.
Radically change the unit of business. Cable companies changed the profit structure of television, moving from advertising to consumer subscriptions.
Radically improve your productivity. A gasket company built an integrated E-commerce website with customer-specific pricing.
Improve your cash flow velocity. American Home Mortgage built systems that let it take advantage of a boom in home mortgage refinancing.
Improve your customers’ personal productivity. Lending Tree uses web-based technology to reduce customer acquisition costs and obtain leads on loans. It claims to empower borrowers by making lenders apply to them.
Help improve your customers’ cash flow. Knowing that shipping time is crucial for computer repair jobs, United Parcel Service took over repair service for Toshiba. Now it does both shipping and repairing.
Help improve your customers’ quality. KLA-Tencor makes equipment and software that can detect defects in silicon wafers.
Capitalize on second-order effects of industry cycles. Saddle River-based Sealed Air Corporation offers a full packaging solution through its website (www.e-packaging.com) and drop ships high quality packaging supplies directly to E-commerce customers of other companies, such as Easy Closets.
Exploit shifts in industry constraints or barriers. When China invited foreign companies to build power plants, a consortium — by planning ahead — successfully captured a contract for a 700-megawatt coal-fired plant in southern China.
Use a shift in a key constraint to disrupt the industry. Botox is replacing plastic surgery as a less dangerous and less costly alternative.
Exploit a shift in the value chain. When sanctions against South African companies were lifted in the early 1990s, a South African brewing company with a lean business model bought other companies and is now the second largest brewer in the world.
Reduce costs or abolish bottlenecks to disrupt the value chain. MBNA works with trade groups to sign up low-risk users of affinity cards.
Shift the dimension of merit. Subway exploited the concept of healthy fast food with the Jared Fogel weight loss advertising campaign.
Build a better mousetrap. Finland-based Kone Corp., a McGrath client, introduced the first elevator that does not need a machine room and captured market share before competitors could catch up.
Undertake inventive missionary work. C.R. Bard came up with a new line of products that reduce the time and difficulty for having hernias repaired.
Create a niche to win. Osim International created a market for home health devices such as blood pressure monitors.
Make a land grab. More than 3 million Swanson TV dinners are consumed each week in the United States. They were introduced in 1954, supposedly by an employee trying to figure out what to do with 520,000 pounds of leftover Thanksgiving turkey. His Eureka moment came on an airline flight, when he saw the crew serve meals in metal trays.
After Title IX legislation, the market for women’s sporting equipment skyrocketed. As pressure to stop smoking increases, Nicorette gum, a GlaxoSmithKline product, will profit.