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What is Differentiation Focus Strategy?

What is the better business model strategy for "mobile gift cards": Growing one market segment before adding another or "Variation then focus"?

  • "Variation then focus", means starting with major actors (customers) in larger markets that are high in "analog gift card" sales. And then focus on building them up one by one. Or is there a better option?

  • Answer:

    Though I lack evidence or the experience to authoritatively suggest one over the other, I would propose that your decision should well align with your organizational mission statement and goals.  For example, if your organization was a credit union with a mission to serve those in a defined region and/or profession, that would be your initial focus.  Thereafter, you may find growth opportunities by expanding your market to include Internet-based transactions.  I believe that you would be best served by spending time defining who your customer is prior to determining applicable verticals.

Peter Spier at Quora Visit the source

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Are you speaking about digital gift cards being sold through a mobile channel only or through multiple channels? Also, are you a retailer or are your referencing an open-loop product as referenced by Peter in his answer?Assuming you are a retailer interested in multiple channels, it would depend on your demographic, segment and location. In the U.S., consumer digital gift card sales are a limited share of total sales currently. It’s growing, especially amongst a younger demographic—but you shouldn’t stop here (read more below.) Newly released information in the U.S. shows about 80% of consumer digital gift card sales are occurring on a desktop (so likely through the retailer’s designated or aggregated website) and then redeemed on their smartphones.That said, I believe you need to consider where your customers or potential customers hang out on the web and strive to gain distribution or visibility there. Furthermore, there are many third-party distributors who are driving significant digital gift card volume through synergistic brands and value-added services. These include: mobile gift card apps or wallets (Slide, Gyft); mobile script (Benefit); digital gift registries and product gifting (Jifiti); corporate/B2B sales (Tango); consumer and corporate portals (National Gift Card, SVM. GiftCards(dot)com); fulfillment (CashStar, Incomm Digital); digital shopping rebates (eBates); digital survey rewards (Rybbon) and many more. I’ve listed only a few examples here of the very sizeable marketplace.

Brenda Gilpatrick

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