Non Consumption

Still talking about innovations in the education industry?

One thing that Clayton Christensen, Harvard business professor, discusses in his book, The Innovator's Solution, is the idea of "competing against non consumption." Essentially, this revolves around offering a product (I use product to describe both products and services) that is not as good as that which is already sold by encumbant firms.

But how can you compete with a product that's worse? You are not really competing with the encumbants, rather, you are competing against non consumption. The people who will buy your product, in this case, a university degree, would not have been able to purchase a degree from any university previously. This could have been because it was inconvenient or too expensive, for example.

The University of Phoenix and firms that offer business training courses in innovation or similar professional courses are not looking to lure would-be Oxford or Chicago students, they are looking for non-consumers. They are looking for customers that the incumbants are motivated to ignore.

If you are a new firm, you have got to look for customers that incumbant firms are not motivated to pursue. In other words, choose your battles where the forces of business are in your favour.