The 3Cs of Marketing Explained with Example

Summary

This lesson introduces the 'Three C's of Marketing'—customers, competitors, and company—as a strategic framework to build a competitive advantage by aligning business objectives with customer needs and market dynamics. The model emphasizes understanding customer demographics, differentiating from competitors, and analyzing internal strengths. Through practical examples, such as Brita, the lesson shows how data collection and analysis across these three areas help shape a successful strategy. The framework is praised for its simplicity and balance but also noted for requiring substantial time and data to be effective.

Takeaways

• 🔑 The Three C's of Marketing is a strategic framework consisting of Customer, Competition, and Company.
• 🎯 Achieving equilibrium among the Three C's is essential for creating a sustainable competitive advantage.
• 🤝 Understanding customers deeply is crucial for serving their interests and creating loyalty.
• 🏢 Differentiating from competitors is key to standing out in the market.
• 🌟 A strong company vision and strategy can guide how a business stands out from the crowd.
• 🧐 Gathering data on each of the Three C's is the first step towards formulating a marketing strategy.
• 🚀 Hertz's example shows the importance of understanding the most valuable customer segments.
• 🚗 Future competition for car insurance companies might come from autonomous vehicles, illustrating the need to anticipate market changes.
• 💧 Brita's case study demonstrates how analyzing the Three C's can lead to a strategy that leverages environmental benefits.
• 🌍 Brita's focus on expanding into Asia highlights the importance of understanding global market opportunities.
• 📈 The Three C's model is simple yet powerful for framing strategic conversations and understanding interdependencies.

Q & A

What are the three C's of marketing?

The three C's of marketing are Customer, Competitor, and Company. They form a strategic framework that helps businesses win in the marketplace by better satisfying customer needs compared to competitors.

Why is it important for businesses to focus on the three C's of marketing?

Focusing on the three C's allows businesses to create a balanced strategy by understanding customer needs, differentiating from competitors, and aligning company goals. This equilibrium helps build a sustainable competitive advantage.

How does the relationship between the three C's create equilibrium?

Changing one of the three C's will impact the others. For example, changes in customer needs may require changes in the company's strategy or affect how it competes in the market. A balanced approach ensures these elements are integrated for long-term success.

What key questions help companies understand their customers?

Key questions include: Who are your customers? What are their demographics? What are their needs and preferences? What problems do they want to solve? These questions help companies become more customer-centric.

How does understanding competitors help businesses improve their strategies?

Understanding competitors allows businesses to identify their competitors' strengths, weaknesses, and strategies. This helps a company differentiate itself, identify potential threats, and capitalize on opportunities to better serve customers.

What is the significance of company analysis in the three C's model?

Company analysis helps businesses reflect on their internal strengths, strategies, and values. It allows them to determine how they can stand out in the market, whether through cost leadership, differentiation, or value addition.

How can companies use the three C's model to develop a competitive strategy?

By analyzing customer needs, competitors' strengths and weaknesses, and their own company's position, businesses can create a strategy that aligns all three elements. This ensures that they can effectively meet customer demands while differentiating from competitors.

What example was given in the script to illustrate the application of the three C's?

The script used Brita, a water filter company, as an example. It analyzed Brita’s customers, competitors, and company strategies, demonstrating how Brita could enhance its competitive advantage by promoting its environmentally friendly products.

What are some advantages of using the three C's model?

Advantages include simplicity, the ability to guide strategic conversations, combining internal and external analysis, and helping businesses understand the interdependence of customer, competitor, and company.

What are the limitations of the three C's model?

The model is only an input to strategy creation and doesn’t define the strategy itself. It can be time-consuming, and its effectiveness depends on the quality of the data collected and the insights generated during the analysis.

Outlines

00:00

📊 The Three C's of Marketing: A Strategic Framework

This paragraph introduces the 'Three C's of Marketing,' a strategic framework to help businesses better satisfy customer needs than competitors. It explains the importance of balancing the three elements—customers, competitors, and the company—within a triangle-like structure. The paragraph highlights how changes in one element affect the others, and when balanced, the business gains a competitive advantage. It also briefly touches on the linkage questions between the three components.

05:01

👥 The First C: Customers

This paragraph focuses on customers, emphasizing that without them, a business cannot survive. It underscores the importance of being customer-centric by truly understanding their needs and demographics through direct engagement. It uses the example of Hertz, a vehicle rental company, whose most valuable customers are business travelers. Hertz must understand these travelers' needs to maintain its competitive edge.

🏆 The Second C: Competitors

This paragraph explains that understanding your competitors is critical because customers have the option to buy from them. It encourages businesses to conduct research, such as competitive analysis and reviewing competitors' strategies. The key takeaway is differentiation—finding ways to stand out. The example of the car insurance market and the future disruption of self-driving cars demonstrates the importance of foresight in competition.

🏢 The Third C: Company

This section covers the importance of understanding your company, its vision, strategy, and how it plans to stand out—either through cost leadership or differentiation. It provides an example of a company attempting to offer the lowest price but being unprepared for a competitor with lower costs. The takeaway is that understanding your company's strengths and market position is essential for a sustainable strategy.

🔄 Bringing the Three C's Together: The Case of Brita

Here, the three C's are applied to Brita, a water filter company. Brita's customers are primarily older adults, with a preference for convenience. Brita faces competition from bottled water brands that offer cheaper, more portable solutions. Brita's company strategy focuses on expanding in Asia, with a vision centered around providing the best drinking water. The paragraph illustrates how Brita can use the three C's data to shape its strategy, including leveraging its environmentally friendly products.

♻️ Leveraging Data for Strategic Advantage

This paragraph explains how Brita could adjust its strategy based on competitor, customer, and company data. Brita can differentiate by emphasizing its reusable products in contrast to competitors' plastic bottles. The company could address environmental concerns to attract first-time buyers and update its mission to focus on sustainability. The importance of testing these strategies with customers is also highlighted.

✅ Advantages and Disadvantages of the Three C's Model

This paragraph reviews the pros and cons of the Three C's model. Advantages include its simplicity, its use for internal and external analysis, and its ability to guide strategic conversations. However, the model is only an input for strategy creation, not a complete solution. It can also be time-consuming, and the results depend on the quality of the data and people involved in the analysis.

🔑 Summary of the Three C's of Marketing

The final paragraph summarizes the Three C's of Marketing as a strategic framework to help businesses win in the marketplace by better satisfying customer needs. It stresses the importance of balancing customers, competitors, and the company to create a successful, differentiated strategy. The lesson concludes with a reminder of the model’s value in crafting a winning approach.

Keywords

💡Three C's of Marketing

The Three C's of Marketing is a strategic framework that helps businesses succeed by focusing on three key elements: customers, competitors, and the company itself. This model emphasizes balancing these elements to create a sustainable competitive advantage. The video describes it as the 'strategic triangle,' where changing one element affects the others, helping to shape a company's strategy.

💡Customer

In the Three C's framework, 'Customer' refers to understanding the needs and preferences of the people who buy a company's products or services. The primary goal is to satisfy customer needs better than competitors. The video highlights how businesses like Hertz prioritize specific customer segments, such as business travelers, and emphasizes the importance of being customer-centric.

💡Competitors

Competitors are the other businesses in the market that offer similar products or services. Understanding competitors allows a company to differentiate itself and identify how it can outperform them. The video discusses how Brita, a water filter company, faces competition from bottled water brands, illustrating how businesses can use the Three C's to navigate competitive threats.

💡Company

The 'Company' aspect of the Three C's model focuses on a business’s internal strengths, vision, and strategy. The video suggests that companies should understand their identity and how they can differentiate themselves from competitors. For example, Brita focuses on its mission to provide clean drinking water and considers shifting towards an environmentally friendly brand to stand out.

💡Equilibrium

Equilibrium in the context of the Three C's refers to the balance between customers, competitors, and the company. When changes are made to one element, they impact the other two. The video explains how this balance is crucial for creating a sustainable competitive advantage, and how altering one aspect can have ripple effects on the business strategy.

💡Differentiation

Differentiation means making a product or service stand out from competitors. It's about offering unique value that others cannot replicate. In the video, Brita aims to differentiate itself by marketing its water filters as more environmentally friendly than bottled water, which is a potential strategy to sidestep competition.

💡Competitive Analysis

Competitive analysis involves studying competitors to understand their strengths, weaknesses, and strategies. This process helps businesses identify opportunities for differentiation. The video suggests methods such as reviewing competitors' annual reports or websites to gather insights, which can then shape a company's strategy.

💡Sustainable Competitive Advantage

A sustainable competitive advantage is a long-term edge a company has over its competitors, allowing it to succeed consistently. The video explains that by balancing the three C's—customers, competitors, and company—businesses can create strategies that are hard for competitors to copy, ensuring long-term success.

💡USP (Unique Selling Proposition)

A Unique Selling Proposition (USP) is a key factor that differentiates a product from its competitors. In the video, Brita is encouraged to emphasize its environmental friendliness as a USP to stand out against bottled water brands. A strong USP can attract customers by highlighting what makes a product unique.

💡Vision

Vision refers to a company's long-term goals and aspirations, shaping its identity and strategy. The video emphasizes how understanding the company’s vision helps it align with customer needs and differentiate from competitors. For example, Brita's vision is to provide the best possible drinking water experience, which guides its market positioning and strategic decisions.

Highlights

The 'Three C's of Marketing' is a strategic framework designed to help businesses win in the marketplace by better satisfying customers' needs compared to competitors.

The model is often visualized as a strategic triangle with three elements—Customer, Competitors, and Company—existing in balance to create a sustainable competitive advantage.

Equilibrium is key in the Three C's model: changing one of the three elements will impact the other two, emphasizing the need for integrated strategy development.

The Customer-Company link addresses the question: 'What is our relationship with customers?' Understanding this link helps focus on customer-centric strategies.

The Company-Competition link addresses: 'How are we different from our competitors?' Identifying unique strengths helps differentiate in the market.

The Customer-Competition link asks: 'What advantages do our competitors have, and how can we sidestep them?' This link guides strategic adjustments to minimize competitive threats.

Gathering data for the Three C's provides insight into customer demographics, company strengths, and competitor positioning, forming a foundation for creating a balanced strategy.

Customer analysis is crucial because customers are the primary reason businesses exist. Understanding customers' needs is key to creating loyal buyers.

Competitor analysis helps identify who the competitors are and why customers might choose them over your company. It is essential for maintaining a competitive edge.

Company analysis involves understanding your organization's vision, strategy, and value proposition. Clear internal understanding helps align with market needs.

The Brita case study illustrates how to apply the Three C's model: by analyzing customer demographics, competitive landscape, and company strategy, Brita can identify its competitive advantage.

Brita's competitors offer bottled water as a cheaper and more portable alternative, but Brita can emphasize its environmental sustainability to differentiate itself.

By focusing on sustainability, Brita can appeal to environmentally conscious customers, addressing concerns about plastic waste and making its higher price more acceptable.

Brita's strategic response includes adjusting its vision to become the most environmentally friendly drinking water provider, thus creating a unique selling proposition.

The real power of the Three C's model lies not just in data collection but in using the data to shape a cohesive, balanced strategy across customers, competitors, and company.

Transcripts

hello and welcome to today's lesson

where we're looking at the three c's of

marketing

so the three c's of marketing is a

strategic framework to help you win in

the marketplace by better satisfying

your customers needs than your

competitors

to build a successful business with

loyal customers you must focus on

satisfying your customers needs

however

you need to do it without forgetting

your competitors or your company's

purpose in other words you need to use

the three c's of marketing now the model

is also known as the strategic triangle

because it is often drawn as a triangle

with each of the three c's existing in a

balance or equilibrium

now equilibrium means that changing any

one of the three cs will have a knock-on

impact on the other seas the model says

that when each of the three c's exist in

an integrated way you create a

sustainable competitive advantage

now another way to think about the three

c's is in terms of the questions posed

by the linkages between the elements

so we have a customer company link so

that question is what is our

relationship with customers we have a

company competition link and the

question there is how are we different

from our competitors and we have a

customer competition link and the

question there is what advantages do our

competitors have and how can we sidestep

these advantages

now once you've gathered data for each

of the three cs you'll understand who

your customers are your relative

strengths as an organization and how you

can meet your customers needs better

than your competition you can then use

this information as an input to go and

create your strategy so let's examine

each of the three c's in more detail

so the first c is customers without

customers your business would fail

customers are the reason your business

exists and your primary goal is to serve

your customers interests

do this well and you will create loyal

customers making it difficult for your

competitors to compete however you'll

have difficulty surviving if you fail to

meet your customers needs now to

understand your customers and ensure you

are customer-centric you can ask the

questions you see here such as who are

your customers and what are their

demographics etc understanding your

customers shouldn't be a theoretical

exercise so you need to get out of the

office and hold conversations with

actual customers to really understand

their needs

let's take a look at the question what

kind of customers are the most valuable

for the vehicle rental company hurts

now over 50 of hertz rentals come from a

small subset of their customers namely

business travelers so this hertz must

deeply understand these business

travelers and their needs to better

serve this important type of customer

so the second c is competitors your

customers don't have to buy from you

they could choose to buy from one of

your competitors and for this reason

it's important to understand your

competition and to do this you can ask

questions such as who are your

competitors

do your customers just buy from you or

do they also buy from your competitors

and if so why do they buy from your

competitors now to collect this

information you'll need to perform

research and that might involve

conducting a competitive analysis

reading your competitors annual reports

talking to your sales team to learn what

they hear from customers or even just

researching your competitors website

now an important thing to note is that

the real key output from this section of

the model is to ensure that you are

differentiated from your competition

that you're different in some way let's

take a look at the question who will

your competitors be in the future for a

car insurance company so imagine you're

a car insurance company your biggest

competitor right now might be other car

insurance companies but this might not

be the case in the future the

advancement of autonomous self-driving

cars may hugely disrupt the car

insurance market what can your

organization do to protect itself from

this threat

the final c is company and this is all

about looking inwards to know who you

are as a company and what you stand for

once you are clear on who you are you'll

better understand how to stand out from

the crowd now to understand your company

you can ask questions such as what is

your vision what is your strategy are

you going to stand out from the crowd

through cost leadership or through

differentiation through adding value now

as an example of examining your own

company suppose your company strategy is

to offer your customers the lowest price

now to provide the lowest price that

means you need to have the lowest cost

base

if you don't have the lowest cost base

then pursuing a cost leadership strategy

is a bad idea well why is that well

because what happens when the company

with a lower cost base undercuts you

you can't react you can't match their

price and you may as a result even go

out of business

let's take a look at an example to bring

all the three c's together

so we're going to look at the company

brita which sells water filters to

consumers who want to drink great

tasting water now using some guesswork

we'll put together a rudimentary three

c's of marketing for brita starting with

their customers

now most of brita's customers are 40 to

75 years old but its best buyers are

between 60 and 75

british customers buy from them because

they want on-demand clean water in their

homes right now customers buy in store

via retail partners but this is changing

and increasingly customers are buying

online

customers have fed back that the easier

britta can make their product to use the

better new customers can be put off

because of the high initial price of the

product now in terms of competitors

there are other water filter makers but

britta has the strongest brand

recognition there is

new competitors are emerging as big

drinks companies bring out bottled water

brands now these competitors offer a

product that is both cheaper and more

portable than british

finally if we look at the company

brita makes easy to use water filters

for personal and professional use

from 2010 the company's focus or

strategy has been to expand into asia as

five of the world's eight largest water

filtration markets are in asia

the company's vision is to offer

everyone the best possible drinking

water experience according to their

individual expectations

now

at this point your three c's of

marketing exercise might look something

like you see here so at this stage

you've essentially done a data

collection exercise but the real power

of the model is in what you do with the

data you've collected to shape your

strategy across all three c's so let's

examine how britta might do this

starting with looking at competitor data

we can see that new competitors are

offering bottled water which they're

advertising as pure and natural water

now whilst the water may be pure and

natural it's being sold in disposable

plastic bottles

british products are actually all

reusable so therefore there's a big

opportunity for brita to bolster its usp

by being the most environmentally

friendly drinking water in the world

now any other brand selling water in

plastic bottles cannot compete with this

eusp and so britta could really sidestep

their competition by doing this and

really stand out from the crowd

now if we look at british customers with

the growing concern about climate change

advertising their new usp may help

brita's first time buyers to overcome

the problem of the high initial price

and finally if we look at the company

the company could update its mission

from providing the best possible

drinking water to include that it

provides the most environmentally

friendly drinking water

now obviously before making any of these

changes to its marketing british should

test these ideas against existing

customers and new customers and their

target market

now this example has aimed to show how

the real power of the three c's of

marketing is in analyzing the data to

create a powerful yet balanced strategy

now there are several advantages and

disadvantages associated with the model

in terms of advantages then it is simple

to understand

it provides a mechanism to frame

strategic conversations with your

management team

unlike some models it provides both

internal and external analysis and

finally it helps you to understand that

you can't change one of the c's without

needing to update the other c's

in terms of disadvantages then the model

is simply an input to strategy creation

it doesn't actually help you determine

your

strategy it can take a long time to

perform it can be time consuming and

finally the quality of the exercise is

only as good as the data you collect and

the quality of the people engaged in

analyzing that data

so in summary the three c's of marketing

model is a strategic framework to help

you win in the marketplace by better

satisfying your customers needs than

your competitors do

it's based on the idea that there are

three elements

customer competitors and company which

must all be in equilibrium to create a

differentiated and winning strategy

so that's it for this lesson really hope

you enjoyed it and i look forward to

speaking to you again soon