Cannibalizing one’s own product has become a common trend, albeit often unsuccessfully in the digital era. The thinking goes that if one does not cannibalize one’s own, a competitor will soon end up disrupting. This is easier said than done, as capabilities to scale are built over many years. Also, it is extremely difficult to transition from one industry to another, otherwise makers of horse-drawn carriages would end up as the auto-makers. That is where the Saudi Aramco’s latest business innovation is a rather counterintuitive, but possibly shrewd method of protecting one’s turf. They have invested in research, to help engines run more efficiently on oil. This means that lesser of Aramco’s produce i.e. oil would be used. But this is a smart ploy as every year we see more number of electricity-driven cars and buses hit the road. There is increasing pressure to make more use of renewable energy. So, this development if successful will ensure that people will continue to use oil well into the future, albeit a bit less than at the present rate.

Source:https://www.strategy-business.com/blog/A-Counterintuitive-Way-to-Shape-Demand?gko=fe7a4

Uploaded Date:15 September 2018