Bowmans Strategic Clock

How do businesses effectively position their products? One way to do this is by using Bowman's Strategic Clock. Bowman's theory includes a clock-shaped model which consists of eight different positions. Let's take a look.

Bowmans Strategic Clock Bowmans Strategic Clock

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Table of contents

    Bowman's Strategic Clock theory

    Bowman's Strategic Clock was invented by Cliff Bowman and David Faulkner and was first published in 1997 in a paper called “Competitive and Corporate Strategy”.

    Bowman’s Strategic Clock is a simple and comprehensive model used to analyse company’s position in the market and to choose the most suitable market strategy. It consists of eight positions across the clock, indicating a different strategy. It aims to help with determining how a product should be positioned to give it the most competitive position in the market.

    Each of the eight positions represents a different strategy that a company can use to compete in the market. Bowman's clock provides a way to comprehend and compare the relative strengths and weaknesses of different strategies. By mapping a company's strategic position on the clock, managers can make informed decisions about pricing, differentiation, and overall market positioning.

    Bowman's Strategic Clock Method

    Firstly, you should think about the two dimensions: value and price of a product or service. These method will guide you and help you to arrive at one of eight positions on the clock. See Figure 1 below.

    Bowman's strategic clock, How to use Bowman's strategic clock, StudySmarterFigure 1. Bowman’s Strategic Clock, StudySmarter

    1. Low Price and Low Value Added

    In this strategy, the price and value of a product or service is very low. It is probably the least competitive strategy in Bowman’s Strategic Clock.

    Poundland sells low-valued products at very low prices, usually at £1 or less.

    2. Low Price

    This strategy is about providing customers with a product or service at the price lower than the price of the competition. Usually, businesses using this strategy focus not on quality but on quantity. They aim to minimise production costs in order to sell as many units as possible at the lowest price.

    Ryanair provides customers with flights which are theoretically a high-valued service. However, Ryanair cuts all the possible costs in order to offer the lowest price.

    3. Hybrid

    This strategy combines low price and product differentiation. Companies using this strategy aim to make their product or service highly valued in the market and in the eyes of their customers. However, the price of the product is low and, therefore, highly competitive.

    Ikea offers a variety of highly valued products at reasonable prices.

    4. Differentiation

    Companies following this strategy try to make their product or service different from the products offered by their competition. Typically they offer the same product or service but with some unique features.

    Adidas offers products that are the same as their competitors (sports clothing, shoes, and accessories). However, their products are unique as they have a different, specific design which is not offered by any of the competitors.

    5. Focused differentiation

    This strategy combines high value and high price. Here companies produce distinguished and highly valued products or services and sell them at the highest price possible. Businesses using this strategy usually make high profits, but they have to put in a lot of effort to make it work successfully.

    Chanel offers highly valued and distinguished products. Their products are high-priced and their customers are willing to pay much more than their competitors.

    6. Risky High Margins

    This strategy combines high price and low value. Here companies offer a low-valued product or service but sell it at the highest price possible. It is a fairly risky strategy that is usually used by businesses with a strong brand name.

    Some gyms tend to offer expensive membership even though they do not offer much more than their competitors.

    7. Monopoly Pricing

    In this market, there is only one business that controls a product or service and its price. There is no competition, but companies using monopoly pricing should keep an eye on the market since all monopolies come to an end.

    Microsoft offers a service that is the only option for customers looking for an operating system.

    8. Loss of Market Share

    This is a strategy for companies exiting a market or being in decline. It is used when companies lose their customers, become less profitable and therefore are forced to lower the prices of their products.

    Blackberry used to offer smartphones, but unfortunately, other smartphone producers defeated the company and as result, Blackberry lost its market share.

    Bowman's strategic clock examples

    Let's take a look at a couple of real companies and their strategies based on Bowman's Strategic Clock:

    CompanyStrategyBowman's clock position
    Walmartlow-price strategybottom left of the clock
    Applehigh product differentiation and premium pricingtop right eight of the clock
    Amazonlow price and high differentiationlower eight of the clock
    Teslahigh differentiation and premium pricestop right eight of the clock

    Advantages and disadvantages of Bowman’s Strategic Clock

    While Bowman's Strategic Clock is a useful tool for analyzing a company's strategic position and has many advantages, you need to consider its limitations. The table below shows the main advantages and disadvantages of the model.

    AdvantagesDisadvantages
    SimplicityLimited scope
    FlexibilityIt doesn't provide guidance on how to improve the strategy
    It offers a variety of starting points to examine a strategyOver-simplification

    Let's talk about the advantages first. Simplicity of the model provides an easy-to-understand framework that also allows to analyse a variety of strategies. Bowman's clocks can also be easily adapted to different industries and market conditions. On the other hand, disadvantages include limited scope - it focuses only on price and differentiation and does not consider other factors like product quality or brand reputation. Bowman's Strategic Clock also does not provide guidance on the implementation of the strategy or on ways to improve it. Its simplicity might become and disadvantage when a company needs to consider the more complex nature of the strategy.

    Bowmans Strategic Clock - Key takeaways

    • Bowman’s Strategic Clock is a strategic tool used to choose the most suitable market strategy.

    • It examines the value and price of a product or service and determines an appropriate strategy.

    • There are eight positions on the clock: low price and value-added, low price, hybrid, differentiation, focused differentiation, risky high margins, monopoly pricing, and loss of market share.

    • While Bowman's Strategic Clock is a simple and comprehensive tool, it also has important constraints like limited scope, over-simplification and lack of actionability.

    Frequently Asked Questions about Bowmans Strategic Clock

    How do you use the Bowman's strategic clock?

    The two dimensions, that are considered in the Bowman's strategic clock, are value and price. These dimensions are analysed through 8 positions on the clock. 

    Who created the Bowmans Strategic clock? 

    Bowman's strategic clock was created by Cliff Bowman and David Faulkner.

    When was Bowman's strategic clock invented? 

    Bowman's strategic clock was invented in 1996. 

    What is Bowman's strategy clock used for? 

    Bowman’s Strategic Clock is used to analyse company's position in the market and to choose the most suitable strategy.

    What are the advantages and disadvantages of Bowman’s Strategic Clock?

    The main advantages of Bowman's Strategic Clock are its simplicity, flexibility, and ability to provide a variety of starting points to analyse a strategy. Disadvantages include: limited scope, potential over-simplification and lack of guidance on how to implement or improve the strategy.

    What is Bowman's Strategy Clock?

    Bowman’s Strategic Clock is a simple and comprehensive model used to choose the most appropriate market strategy. It consists of eight positions across the clock, each indicating a different market strategy.

    Test your knowledge with multiple choice flashcards

    Which of these companies use a differentiation strategy?

    What is the least competitive strategy on the Bowman's Strategic Clock?

    Do businesses using the Monopoly Pricing strategy face any competition?

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