Designing for superior business performance

A guide for technology, creative and startup leaders

"The golden rule for every business leader is this: 'Put yourself in your customer's place.”
Orison Swett Marden.

Why define a consumption chain

A consumption chain can be used to look for or provide differentiation opportunities. The objective is to map the consumption chain, which involves tracing your customer’s entire experience with your product or service. Professors Ian McMillan and Rita McGrath, who developed and advocate the technique, indicate that you perform this exercise for each important customer segment. Mapping the consumption chain involves identifying all the steps through which customers pass from the time they first become aware of a need for a product/service to the time when they finally have to dispose of it or discontinue using it. Although products or services have variation in consumption chains, they also share substantial commonality. To understand the consumption chain, MacMillan and McGrath suggest resolving the following considerations catered for in the StrategyCAD™ consumption chain section of the offering canvas.

You can work through MacMillan and McGrath's consumption chain in the following sections arranged as

1. Pre-purchase

2. Acquire

3. Usage

Each of these sections will include smaller questions MacMillan and McGrath recommend the consumption chain considers.

Consumption chain - pre purchase

Pre-purchase section of the StrategyCAD consumption chain specifically considering awareness, search and selection

Pre-purchase - Awareness

Your value proposition may be able to differentiate its product if it can find a unique way to make consumers aware of a need.

Examples:

• People often fail to schedule servicing of their cars, for various reasons hence skip or schedule well after they are due. Instead, many auto-makers now provide persistent alerts on the dashboard to make the driver aware of the need to arrange the Servicing is better for the auto-makers warranty and for their service and sales partners.

• Many years ago, Oral-B the toothbrush manufacturer created a tooth brush, that when the color on the bristles faded, meant that it was time for a new toothbrush, hence increasing awareness to purchase a new one.

To do

1. Identify how a customer can become aware of your value proposition / offering.

2. Identify opportunities, to make the awareness one that creates advantage relative to alternatives / substitutes.

Awareness

Enabling a customer to become aware of the offering and ideally in manner superior and cost effectively to alternatives / substitutes.

Capture your search consumption chain search hypothesis in this table if not using StrategyCAD™

Pre-purchase - Search

Once potential customers are aware of a need and are searching for a solution then they then must find a solution and better yet, they find the offerings in your value proposition. You can differentiate you offering if you can make the search process easier for customers by making it less complicated, more convenient, or less expensive.

Examples:

• McDonald's makes it easier to find their restaurant by placing road signs on the sides of highways along with the usually obvious gigantic "Golden archs".

• Many business invest in SEO or pay for search engine and social media ads to help consumers find their product by paying to be at the top of a search.

• Presenting via webinar and trade-shows is another way to make it easier for targeted audiences to become aware of both their need and your offering.

• Manufacturers and distributors often aim to acquire the premium shelf space at retail outlets at supermarkets, to increase the ease with which the product can be found.

• Elon Musk, is effectively, the human headline to the extent that his company's products need no introduction and are readily in most peoples awareness.

• Influencers have always been a way to introduce an offering with the credibility of the influencer but is becoming more common, with the expansion of social media and the number of influencers. Obviously, choosing an influencer with a following representative of your target segment will be beneficial.

To do

1. Identify how a customer can find your offering.

2. Identify opportunities, to make the search easier and superior to alternatives and substitutes.

Search

Enabling a customer to discover the offering and ideally in manner superior and cost effectively to alternatives / substitutes

Capture your search consumption chain search hypothesis in this table if not using StrategyCAD™

Pre-purchase - Selection

A consumer will narrow down the possibilities, they then must make a choice. This is the time when product attributes may dominate, and it is critical to ensure that consumers are aware of advantages of your differentiate a product.

Examples:

• You could provide side-by-side comparisons of your products comparied with rivals. Highlighting potential advantages relevant to the customers. The comparison list can enable consumers to see which product has the features they care about / need the most.
  

• You can select the one feature that customers might care about and trumpet how your product beats others on that particular feature. Google has been doing this with its' Pixel offering and the Eraser feature on photos.

To do

1. Identify how a customer can be more likely to select your offering.

2. Identify opportunities, to make the selection easier and demonstrate why it is a superior choice to alternatives and substitutes.

Selection

Enabling a customer to select the offering and ideally in manner superior and cost effectively to alternatives / substitutes

Capture your search consumption chain search hypothesis in this table if not using StrategyCAD™

Continue . . . Consumption canvas to Acquire your offering

Next up continue with the Offering canvas to define your offerings' consumption chain for the buy or acquire step. This step includes defining and considering opportunities to create advantage in the order, delivery and usage activities.

Advance your strategy productivity

Define, refine and implement your consumption chain faster, easier, collaboratively and better in StrategyCAD™rategy