John Beddington
Scott Bearden
Patrick Lewis
Lauren Frick
Trevor McDonald
Maximizing the Size of the Blue
Ocean
 Look to non-customers; build on commonalities and what
buyers value
 To reach beyond existing demand, think non-customers
before customers; commonalities before difference; and desegmentation before pursuing finer segmentation
The Three Tiers of non-customers
 Tier one: “soon-to-be” non-customers who are on the
edge of your market, waiting to jump ship
 Tier two: “refusing” non-customers who consciously
choose against your market
 Tier three: “unexplored” non-customers who are in
markets distant from yours
Tier one: “soon-to-be” noncustomers
 Pret: British fast food chain
 The lesson: non-customers tend to offer far more
insight into how to unlock and grow a blue ocean than
do relatively content existing customers
 Look for the commonalities across their responses.
Focus on these, and not on the differences between
them. You will glean insight into how to de-segment
buyers and unleash an ocean of laten untapped
demand
Tier two: “refusing” non-customers
 JCDecaux
 Solution: provide street furniture for everyone that
firms could use to advertise on at a low cost
 Look for commonalities across their responses. Focus
on these, and not on their differences. You will glean
insight into how to unleash an ocean of latent
untapped demand
Tier three: “unexplored” noncustomers
 U.S. Defense Aerospace industry: JSF
 Solution: build one aircraft to accommodate the needs
of multiple branches of the military
 Tier three customers are not targeted by firms in the
industry because they believe the customers belong to
other markets
Three tiers and Amazon
 Tier one: people looking to buy books and electronics
on-line now offered one website for all their needs
 Tier two: Amazon offers value-added services to
encourage “refusing” non-customers to buy from them
 Tier three: Amazon offers such a wide array of
products that it appeals to people not looking to buys
books (unlike Barnes & Noble website)
Takeaways
 Understand the three tiers of non-customers
 Tier one: “soon-to-be”
 Tier two: “refusing”
 Tier three: “unexplored”
 “The Biggest Catchment”: don’t focus on a single tier,
explore whether there are overlapping commonalities
across all three tiers of non-customers