Capturing New Markets – How Smart Companies Create Opportunities Others Don’t by Stephen Wunker, New York: McGraw Hill, 2011, pp. 240, €24.99 hb, ISBN 978 0 07 176744 4
Reviewer: Con Power*
- Deputy Chairman, Regulatory and Disciplinary Committees, Association of Chartered Certified Accountants, former Director of Economic Policy, Irish Business and Employers Confederation (IBEC)
Every author is necessarily influenced by the culture within which s/he lives and works. Stephen Wunker is an entrepreneur, consultant and writer who was formed by the United States of America and by US prestigious universities. His track record has the hallmarks of success and self-confidence associated with what is best in US entrepreneurship.
This book is worth reading, not least because it gives a fascinating insight into the mind and thought processes of a man who has successfully linked academic theory with practice in the commercial marketplace. Wunker tells his own story of establishing and leading enterprises in the information technology and communications sectors of cellular networks and mobile Internet and he also tells of advising clients on developing and marketing new growth platforms for both start-up and established businesses in six continents. The book has nine chapters and associated material. The style makes for initial easy reading and the book is structured for ease of further reference.
Over the nine chapters, the author justifies his claim that the book explains how to find, enter and win new markets and it addresses the creation of a corporate competency to generate growth and to replicate the process. The structure follows an orderly progression through the nature of new markets, how to find markets, how to assess those markets, how to enter those markets, strategies for market penetration, ‘timing is everything’ – when to be first and when to follow. Other issues include profitably tackling new markets in developing countries, building a corporate capacity (changes in the internal processes, structures and culture of the firm focused on winning markets), and how public policy can support or hinder growth in new markets, including the role of low-cost and apolitical public policies in generating big returns from new market developments. Advice is given on commercially-attractive platforms that do not need government support and on arcane intellectual property legislation that is in need of public policy review. Each chapter concludes with a brief summary of the key points.
Wunker’s insights on globalisation, the free flow of information, the rise of virtual channels, the rapid introduction of new open platforms, and the challenges of economic discontinuities are especially apposite in times when economic recovery and employment generation depend critically on success in new markets.
He gives an incisive analysis of some classic business success stories like the establishment and phenomenal market growth of the Eastman Kodak Company, a story that he traces back to George Eastman buying his first camera in November 1877. From this and other case studies the author abstracts lessons on how new markets eventually come to fruition. As he wisely says, new markets “seldom blossom from nothing but rather can stew in a half-formed state for long periods until conditions become right”. He looks forensically at parameters such as the preferences of the great bulk of potential customers, technological advancements and a complementary business model with a network of enterprises that facilitate an industry taking root. Eventually, once all necessary conditions align, growth can occur rapidly. He gives examples of some great inventions that took an exceedingly long time to reach market popularity. One such example is the flushing toilet, first recorded in some cities of the Indus Valley about 4,500 years ago but not popularised in the market until the middle of the nineteenth century.
Important advice is to focus on assumptions, not on highly sophisticated statistical projections for new markets that are inherently uncertain and require that the spotlight be on major risks. Wunker wisely observes that inappropriate projections bury “the impact of critical assumptions within complex financial models, turning the emphasis of the discussion away from what is truly important”. The reader will, no doubt, see the wisdom of Wunker’s advice on various aspects of scenario planning and related market identification parameters against the background of stock-market, property and banking collapses and the crisis in public finances.
Much of what this book is all about is summarised in a statement near the end that “start-ups need a thorough profile of the latent need they are targeting, a clear idea of their foothold market, and a sequenced plan of risk mitigation.” His analysis and advice have an application on a broader societal basis than new markets! The book can be readily recommended to the academic and to the entrepreneur.