Narrow Your Focus, Fatten Your Wallet?

In BrandSimple, authors Allen P. Adamson and Martin Sorrell  praise the Iridium company for learning from its mistakes.

iridium_phone_just_phoneIridium makes those very dependable, rugged, but hardy aesthetic or even practical-for-the-average-person phones that get service everywhere. They thought their market would be anyone who wanted dependable phone service. Because their service is satellite-based, it can get a signal in places other wireless providers can only dream of. This benefit also appears, at first, to address a chief concern most cell phone customers have, which is that the service they typically get from their cell phones varies from inconsistent to downright unreliable. So providing a product that addressed this chief concern sounded like a winner of an idea.

Turns out, however, not everyone fully appreciated this value. The customers had a lot of “yeah buts.” “Yeah, it’s a great phone, but it’s so bulky,” and “Oh it’s a rugged phone to be sure, but it’s…well… ugly!” or “I appreciate that you can get service anywhere, but to carry that thing around all day…” and so on.

So Iridium went back to the market segmentation drawing board and asked themselves, “Who needs a rugged, dependable, quality phone but isn’t so concerned with how it looks or how bulky it is?” They came up with several profitable answers, including: Fire Fighters and workers stationed on off-shore drilling rigs. Far smaller segments than what they were after originally, and also far more profitable! Owning a big piece of a small pie is one way to make a fortune! And once again, the answer is the customer!