Is your growth limited because your technical product isn’t being effectively positioned to meet important business needs? Is your mature product floundering because you aren’t experienced in dealing with new types of economic, executive, or non-technical buyers? Does the successful launch of your new product require you to convince unfamiliar stakeholders of its value?

These are all situations that require Market Shaping. Market shaping refers to the strategic actions taken by a company, organization, or group of stakeholders to actively influence the structure, dynamics, and rules of a market.

Rather than simply reacting to market conditions, market shapers aim to alter the market in a way that creates new opportunities, shifts competitive dynamics, and changes customer behavior or preferences. This can involve introducing new business models, creating entirely new markets or categories, redefining the value proposition, influencing regulations, or changing the way customers perceive and use products or services.

Whether you’re aiming to grow through innovative new avenues, revitalize mature products, or ensure a successful product launch, the principles of market shaping can provide the strategic edge you need. Let’s explore how you can implement these strategies effectively, with real-world examples to guide you.

1. Understand the Need for Market Shaping

Market shaping is essential when your goal is to move beyond simply reacting to market conditions. Instead, it’s about proactively altering the market environment to fit your strengths, ensuring that your business remains competitive and relevant in the face of rapid changes.

Example: Southwest Airlines
Southwest Airlines, despite its recent struggles, had a long run of success that redefined the airline industry. Instead of directly competing with other airlines, Southwest identified ground transportation as its primary competitor.

By offering low-cost, reliable flights, Southwest positioned itself as an attractive alternative to driving or taking a bus, effectively reshaping the market to its advantage. This strategic move allowed Southwest to dominate the short-haul travel market for decades, illustrating the power of market shaping in transforming an industry.

2. Identify Opportunities for Market Shaping

To successfully shape your market, you need to identify opportunities where you can introduce new value propositions that resonate with customers in ways they may not have previously considered. This might involve exploring new product uses, targeting different customer segments, or emphasizing unique features.

Example: Honeywell’s Pivot to Connected Solutions
Honeywell, a leader in industrial products, identified an opportunity to reshape its market by pivoting from traditional hardware to connected solutions. By integrating IoT (Internet of Things) technologies into their products, Honeywell transformed its offerings into smart, connected systems that deliver real-time data and analytics.

This move allowed Honeywell to create new value for its customers, positioning the company as a leader in the emerging field of industrial connectivity and smart solutions. Honeywell’s strategic shift demonstrates how identifying and capitalizing on market shaping opportunities can redefine an entire industry.

3. Develop a Market Shaping Strategy

Once you’ve identified opportunities, the next step is to develop a strategy that leverages your strengths to redefine the market. This involves positioning your product or service in a way that alters customer perceptions and shifts the competitive landscape in your favor.

Example: Microsoft Azure’s Shift in Stakeholder Focus
Beginning in 2018, Microsoft pivoted Azure from a general IT platform to one that directly addressed the needs of new stakeholders like Chief Digital Officers and industry-specific CIOs. This shift required Microsoft to learn and speak a new language focused on the unique challenges and compliance demands of sectors like healthcare and finance. By developing industry-specific cloud solutions and forging strategic partnerships, Microsoft successfully engaged these key decision-makers, positioning Azure as a vital tool for digital transformation in complex, regulated industries.

4. Anticipate and Manage Competitive Reactions

Effective market shaping also requires anticipating how competitors might respond and planning your strategy several steps ahead. By thinking through your “third move first,” you can better prepare for potential challenges and ensure your strategy remains resilient.

Example: War-Gaming in New Pharmaceutical Product Launches
War-gaming, a strategic exercise used by companies to simulate competitor reactions, can be invaluable in shaping a market. For instance, in the launch of a new pharmaceutical product, a company might simulate how competitors would react to its pricing, messaging, and market entry strategies.

This approach allows the company to refine its launch plan before going to market, minimizing the risk of unforeseen challenges and maximizing the chances of success. As discussed in our article on war-gaming, companies that employ this tactic can anticipate competitor moves and counteract them effectively, ensuring that their market-shaping strategies hold strong.

The Role of Marketers in Leading Market Shaping

At Impact, our vision for the role of marketers in the modern organization is clear: marketers should be leading the charge on market shaping. The complexities of today’s business environment demand that marketers do more than just support sales or execute promotional tactics—they need to be the orchestrators of strategy, the ones who identify new opportunities, anticipate challenges, and steer the organization toward success. For more on how marketers can develop the skills needed to become market shapers, check out our white paper on market shaping skills.

Conclusion: Why You Can’t Afford to Ignore Market Shaping

today’s dynamic business environment, market shaping is not just a strategy—it’s a survival tool. Whether you’re launching a new product, revitalizing an existing one, or simply striving to stay ahead of the competition, market shaping allows you to take control of your market’s narrative.

By understanding the need, identifying opportunities, developing a strategy, anticipating competitive reactions, and executing with precision, you can position your company as a leader in a newly defined market space. The companies that master market shaping don’t just compete—they set the rules of the game.

So, are you ready to shape your market, or will you let the market shape you? The choice is yours.