172 Section Two Opportunity Analysis

differences among benefit segments. Such information can be useful for developing advertising

appeals, selecting media, focusing personal selling efforts, and designing many of the other ele-

ments of a marketing program that can be effective in appealing to a particular segment.

17.The size of the individual circles in Exhibit 7.8 is fictitious and designed for illustrative purposes

only.

18.The map in Exhibit 7.8 shows five distinct preference segments but only one set of perceived

product positions. The implication is that consumers in this sample were similar in the way they

perceived existing brands but different in the product attributes they preferred. This is the most

cormnon situation; customers tend to vary more in the benefits they seek than in how they per-

ceive available products or brands. Sometimes, however, various segments may perceive the po-sitions of existing brands quite differently. They may even use different determinant attributes in

assessing these positions. Under such circumstances, a marketer should construct a separatemarket-positioning map for each segment.

19. Michael J. Lamming, Delivering Prqfitable liable (Cambridge, MA: Perseus Books, 1998).

20.Patrick Bar,vise and Sefin Meehan, Simply Better: Wim~ing and Keeping Customers by Deliver-

ing gqtat Matters Most (Cambridge, MA: Harvard Business School Press, 2004).

21. For extensive critical reviews of past marketing applications of these different approaches, see

John R. Hauser and Frank S. Koppleman, "Alternative Perceptual Mapping Techniques: Relative

Accuracy and Usefulness," Journal qfMarketing Research, November 1979, pp. 495-506; John W.

Keon, "Product Positioning: TRINODAL Mapping of Brand Images, Ad Images, and Consumer

Preference," Jomwal of Marketing Researck, November 1983, pp. 380-92; Paul E. Green, J. Doug-

las Carroll, and Stephen M. Goldberg, "A General Approach to Product Design Optimization via

Conjoint Analysis," Journal of Marketing Research, May 1985, pp. 168-84; Thomas W. Leigh,

David M. McKay, and John O. Summers, "Reliability and Validity of Conjoint Analysis and Self-

Explicated Weights," Journal of Marketing Research, November 1984, pp. 456-63; Paul E.

Green, "Hybrid Models for Conjoint Analysis: An Expository Review," Journal of Marketing Re-

seamh, May 1984, pp. 184-93; E. M. Steenkamp, Jan-Benedict, Hans C. M. Van Trijp, and Jos

M. E Ten Berge, "Perceptual Mapping Based on Idiosyncratic Sets of Attributes," Journal of

Marketing Research, February 1994, p. 15; and J. Douglas Carroll and Paul E. Green, "Psycho-

metric Methods in Marketing Research: Part I, Conjoint Analysis," Journal qflMarketing Re-searck, November 1995, p. 385.

Marketing Strategiesfor New Market EntriesCanon, Inc.--Success That Is Hard to Copy1

While many observers are optimistic that Japanseconomy has recently returned to robust health, ithad suffered through four recessions during the1990s and the first years of this century. Conse-quently, many Japanese manufacturers--evensome of the largest global competitors--struggledto remain profitable and survive. However, a fewfirms not only survived but grew and prospered inspite of the difficult domestic market environment.Canon, Inc., is one of those stellar performers. Thecompany earned about $2.5 billion on consoli-dated net sales of approximately $30 billion in2003, which gave it a third straight year of recordprofits and a nearly 14 percent return on equity.

How has Canon managed to wring so muchmoney out of its copiers, printers, and cameraswhen other Japanese electronics firms have floun-dered? For one thing, Fujio Mitarai, the firms CEO,has been willing to adopt some Western cost-cutting practices he learned during the 23 years heworked for Canon in America. First, he narrowedthe companys strategic scope by concentrating ona few product markets where the firm had an es-tablished market presence and superior technolog-ical capabilities, while abandoning other busi-nesses where it had a weaker competitive position,such as personal computers and liquid-crystal dis-plays. Mr. Mitarai also scrapped the assembly linesin all 29 of Canons Japanese plants, replacingthem with small work teams--or "cells"--of aboutsix employees who do the work of about 30 work-ers under the old system. These self-managed cellshave not only reduced Cartons labor costs but en-abled the firm to cut its inventory of component

parts by 30 percent and to close 20 of its 34 ware-houses. In addition, Mr. Mitarai is gradually movinga larger portion of Canons manufacturing outsideof Japan to countries like Vietnam and China.

But a sharper market focus and increased man-ufacturing efficiency are not sufficient to explainthe firms strong performance. Other Japaneseelectronics firms have copied such cost-cutting ac-tions without duplicating Canons results. A secondimportant strategic thrust underlying Canons suc-cess is a heavy emphasis on developing and mar-keting a stream of new products, product im-provements, and line extensions in order to sustaina leading share position in its core businesses.

As a first step toward implementing this productdevelopment strategy, the company plows nearly 8percent of its total revenues back into productR&D. Some of that investment is targeted at con-tinued improvement of Canons offerings in busi-nesses where it already holds a dominant marketshare. For instance, Canons technical leadershiphas enabled it to maintain a 60 percent share ofthe global market for the core engines used topower laser printers, including printers developedthrough an alliance with Hewlett-Packard. In othercases, Canons development efforts focus on inno-vative new-to-the-world products--like the devel-opment of a digital radiography system--or productmodifications aimed at new applications segments,such as a wide-format bubble jet printer for thecommercial printing industry.

Of course, it is one thing to develop a bunch ofnew products on the cutting edge of technology,but making potential customers aware of those

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