Choosing Where to play

Choice 2

This strategic choice aims to define a set of sub-choices to configure or design an environment or set of environments where your business can best succeed or find the most fertile field for the value your business can provide.

No business can be all things to everyone, so your where to play choice is a set of choices definining where you believe your business can best serve and succeed.

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"Don't judge each day by the harvest you reap but by the seeds that you plant. .”
Robert Louis Stevenson

Your mission

Define your arena to minimize competition and maximize probability of success.

A critical first step is clearly defining an environment where your business can be valuable and win with accessible customers. Where do you compete? In order to reduce direction competition your levers of uniqueness for where to play include:

What market segments - who your business focuses upon serving and winning with
What customer problems are solved and needs are addressed
What relative price, does your business play
What industry segment including geography does your business play?

A unique combination of these levers or attributes can define an environment that is tailored for your business to succeed or win in.

where to play elements — Where to play includes the 3 components of Michael E. Porter's value proposition applied to a particular industry and geographic region. By configuring the different elements of the value proposition, the industry environment and/or geography, you can create uniqueness to reduce direct competition and optimize success.
Your unique configuration then provides distinct opportunities or threats.

Where to play sub-choices

You want to be as precise as you can, to enable the best use of your resources to win on that playing field. The elements of the Where to play layer of the Strategic choices canvas are introduced in the tabs below. Following the canvas elements are some consideration for a startup Where to play and reshaping an existing but overly competitive arena.

NOTE: Your where to play choice needs to be supportive or logically consistent with your aspirations. If as you develop your where to play choice it becomes inconsistent with your Aspirations then one, the other or both need to be adjusted to create that consistency.

Special tip

You define your segment, you can use the Arena canvas (link below) to clarify what your industry segment is, its' size, growth potential, influences, critical success factors and fit for your business.

industry segment of where to play choice

Use the Arena canvas to define and clarify you Where to Play Industry segment

Desirable consumer / market segments have the most need for the problem you solve, are willing to pay your relative price and are accessible to your business.

customer segment of where to play choice

Which consumer segments are you focused upon in your industry and geography?

Consider:

Segments that exist - assess or describe the segments current being served by the industry in the region.
Segments that could exist (be created / Blue ocean segment(s)) - segments are created via variations in demographics, psychographics, behavioral, usage, loyalty, firmographics and variety of other methods. See Which customers for detailed information
Accessible - can be reached by your business
Willingness to pay - the segment willing to pay your relative price to solve the problem your business solves?

Clarify the types of problems solved or the type of solutions available in the arena (geography, industry segment, relative price)?

Define the problems your business solves, along with the triggers, situations and emotional, social and functional needs of your customer / market segment.

problems solved in the where to play choice

The Jobs to be Done Framework validated by legendary Harvard Business Professor, Clayton Christensen, is customer rather than product centric way of defining the customer problems and the related functional, emotional and social needs.

See Problems we solve page for more detailed information.

Who are the players in the ecosystem of the arena including

Who are likely and worthy rivals of your business
What can you learn from these rivals to improve your business performance
Who are the suppliers, valuable partners, and other ecosystem players
What complements and substitutes (alternative solutions) affect the industry, industry segment, in your business in the geographic region

You can use the Competitor canvas in StrategyCAD™ to record strategic details along with SWOT assessments and more for each candidate competitor to better understand how they do and may behave.

competitor canvas to understand the strategy,
aspirations and behaviour of other players in your arena — Use the competitor canvas to understand the aspirations, strategic choices and behaviour of other players in your arena.

As you assess in your strategy implementation where you are in your arena you can assess your competitiveness relative to other players via a scorecard and corresponding strategy map.

Clarify the relative price that your business will play at?

Is your pricing based upon being a cost leader, a product leader with differentiated pricing for your target segment?

Alternatively, is your pricing premium based upon extraordinary service, product capability, quality or other attributes or customer centricity?

problems solved in the where to play choice

Pricing is one of the core components that can be used to create uniqueness for your where to play choice. View the Relative price guide to see more.

Assess, speculate and pursue opportunities and mitigate threats as the business environment changes

Opportunities and threats emerge in response to technological, economic, political, social, socio-economic, global and other changes. Anticipating, assessing, and speculating on the changes in needs and demand in response to these changes is how opportunities are realized and threats avoided.

problems solved in the where to play choice

Opportunities and threats are identified using external, industry, demand and supply or even competitive assessments. These assessments are contained within the Arean (industry segment) canvas.

Reshaping an existing but losing Arena

If your current where to play choice is large, and you are finding the competitive environment tough, it could be worth reconsidering this strategic choice, along with your proximate aspiration(s). Perhaps your business is:

trying to be too many things to too many
lacking a value proposition that is specifically relevant to the arena or arenas your business is in
too undifferentiated and being outplayed by better resourced rivals

In the subsequent chapter when we discuss value proposition, you can see how you vary your value proposition from others in your arena.
For example, When Google entered internet search there were dozens of other larger rivals, but in the end, Google was able to win. Google's differentiation in value proposition enabled that victory.

the principle of arena selection is to choose an arena
where you can succeed - have the least competition

Define your arena to have the minimum competition or be superior to the rivals in that arena. Avoid an arena where you need to compete against better resourced rivals.

If you are in Startup m ode and defining a your new arena, Peter Thiel would recommend you pick a small niche market that you could dominate and then gradually expand out. It is easier and almost certainly more cost-effective to succeed from a wining position in a smaller market, rather than aim to compete in a huge market against more seasoned businesses with greater resources, reputation, and success prospects. Even Facebook (in which Peter Thiel was the first investor) started out constrained to Harvard University, it then expanded to other Universities before becoming more publicly and globally accessible. Compare the Facebook approach to the now defunct Friendster, which while broadly available lacked the resources to sufficiently manage the demand for its offering.

Making the Where to play choice - easier

The where to play can be complicated but many of its elements can be made more accessible with the right tools. StrategyCAD™ provides the Arena, Opportunity, Jobs To be Done, and Customer segmentation canvas to assist in deciding and capturing these sub-choices and seeing how they relate to each other.

Strategic choices canvas overview

Table of contents

Choosing - Which customers

References

	Playing to Win: How Strategy Really Works, 2013, A.G. Lafely and Roger L. Martin
	Strategic Management: Concepts and Cases 3rd Edition, 2016, Jeff Dyer, Paul C. Godfrey, Robert J. Jensen, David J. Bryce
	Understanding Michael Porter: The Essential Guide to Competition and Strategy , 2011, Joan Magretta
	Blue Ocean Strategy, Expanded Edition: How to Create Uncontested Market Space and Make the Competition Irrelevant , 2020, W. Chan Kim, Renee Mauborgne