Customers
Who buys, what they need and how they see you against rivals.
- Ask
- Needs and the benefits they want
- Ask
- How they rate you against rivals
- Ask
- How many there are, and what they pay
The 3Cs framework, Ohmae's 3C model, worked
The 3Cs framework, or 3C model, builds a strategy around three things: the company, its customers and its competitors. It is credited to Kenichi Ohmae, who called it the strategic triangle in 1982. In a case interview it gives you a quick structure for market entry, new product and competitive response questions: what customers need, what the company does better than rivals, and how rivals will react. Soreno, an AI voice interview practice app for consulting, investment banking and other finance candidates, runs a free market entry case with no sign-up, where you decide whether a company should enter a new market, and full mock cases with scored feedback.
Updated
- What it looks at
- Company, customers, competitors
- One strategy, from three sides
- Origin
- Kenichi Ohmae
- The Mind of the Strategist, 1982
- Worked case
- 1 bank, 1 new account
- Invented by us, every number shown
- Free practice
- No sign-up
- A full market entry case with a timer
What is the 3Cs framework?
Jerry Wind of the Wharton School describes the 3C model as one that focuses on the company, the customer and the competitors, citing Ohmae's The Mind of the Strategist (McGraw-Hill, 1982). A Hong Kong Polytechnic University paper calls it the strategic triangle, after Ohmae's 1982 article of that name, and says it joins the three most critical elements in a market to focus on when starting a strategy. Its point is balance. Wind writes that focusing only on competitors is an inadequate basis for any strategy, and that the 3C model is clearly superior to many of the competitive strategy models that overlook the customer.
Company
What the company is trying to do and what makes it different.
- Ask
- Its mission and objectives
- Ask
- What it does better than rivals
- Ask
- What it would cost to serve this need
Competitors
Today's rivals and the ones that could arrive, from inside the industry or outside it.
- Ask
- Who serves this need now
- Ask
- What they are likely to do next
- Ask
- How they will react to your move
Worked example: Harbor Bank (ours)5 steps
Harbor Bank, an invented regional bank, wants more young customers. It is weighing a no-fee checking account for college students. Two national banks already offer one. Should Harbor launch it? This case and every number in it are invented by Soreno for practice.
Customers
120,000 students nearby, 8% to win
There are 120,000 college students near Harbor's branches. In this case, students say they pick a bank for no fees, a good app and a branch near campus. If Harbor wins 8% by year three, that is 9,600 accounts.
Competitors
No fees is already taken
Both national banks already offer no-fee student checking, so no fees alone won't win anyone. Their apps are better than Harbor's. But between them they have 5 branches within a mile of a campus.
Company
14 branches near campus, a weaker app
Harbor has 14 branches within a mile of a campus, nearly three times the rivals' 5. That is the one thing it does better for this customer, so the offer should lean on it: campus help desks at the start of term, not a price cut.
The numbers
$192,000 a year by year three, payback in year 2
9,600 accounts at $2,000 each hold $19.2 million. At 2.5% that earns $480,000 a year, less $288,000 to run the accounts at $30 each, for $192,000 once all of them are open. If accounts build up evenly over 3 years, Harbor makes $64,000 in year one and $128,000 in year two, so the $150,000 launch cost pays back in year 2.
Recommend
Launch, and compete on campus, not on fees
Launch the account and sell it through the campus branches, and fix the app before the first term. The main risk: a rival opens campus branches or adds perks. The next step is a one-term test at the three biggest campuses.
What each C coversFrom Wharton's Jerry Wind
Wind lists the three as the conventional factors of competitive strategy and describes each one.
1
The company
The mission, the objectives and what is particular to this firm.
2
The customers
Customer needs, the benefits they want and how they see the company and its competitors.
3
The competitors
Current and potential competitors, from within the industry and outside it, their offensive strategies and how they are likely to react to the company's moves.
Where the 3C model stopsWind's critique
From the same Wharton paper.
The limit
Three Cs are not the whole picture
Wind calls the 3C model insufficient on its own for setting the nature and boundaries of a competitive strategy.
His fix
The 6Cs
He proposes a 6Cs model that keeps the three conventional factors and adds three more, starting with channels of distribution and ending with culture and other environmental forces such as technology and regulation.
For a case
Add the outside world when it matters
In our experience, that is the useful lesson for an interview: start with the three Cs, then add channels or regulation when the case turns on them.
From Wharton, Jerry Wind, A Marketing Perspective for Competitive Strategy, Hong Kong Polytechnic University, the 3C model as the strategic triangle and Harvard Business School ISC: The Five Forces.
How do you use the 3Cs framework in a case interview?
In our experience, the 3Cs work best as a quick first structure, then get replaced by something sharper once you know what the case turns on. Here is what we listen for, and when to leave it out.
Start with the customer
Who buys, what they need and how many there are. Without that, the company and competitor branches have nothing to aim at.
Link the three
The insight is where they meet: a need customers have that the company can meet better than rivals. Three separate lists miss it.
Add the numbers and the economics
The 3Cs don't size a market or test profit. Add a market size, a share and a cost, and say whether the move pays.
Know when not to use it
Skip it for a profit decline, a cost cut, an operations problem or a deal valuation. A profit tree, a process map or a valuation structure fits better there.
6 case questions where the 3Cs help
Each of these asks how a company should compete for a customer: entering a market, launching or pricing a product, or answering a rival. Under each is what a strong answer does.
Enter, launch or price
A new market, a new product or a new price.
A US coffee chain is considering opening in India. How would you approach it?
Starts with Indian customers' habits and prices, looks at the chains and local cafes already there, then asks what the brand brings that they don't. Practice it, see a model answer
A pharmaceutical company is about to launch a new drug. How would you set the price?
Starts with who prescribes and who pays, then the treatments already in use, then what the drug does better and what that is worth to them. Practice it, see a model answer
An airline is deciding whether to raise its checked-bag fee. How would you think about it?
Asks how many flyers would switch over the fee, what rivals charge and whether they would follow, then what the airline gains per bag. Practice it, see a model answer
Answer a rival
A competitor moved, or customers drifted.
Your client's main competitor has just cut prices by 20%. How should the client respond?
Asks which customers are price sensitive, why the rival cut and whether it can last, then weighs matching against holding on value. Practice it, see a model answer
A leading shampoo brand has lost five points of market share in two years. What would you look at?
Checks whether customers' needs changed, which rivals gained the share, and what changed in the brand's own product, price or shelf space. Practice it, see a model answer
A streaming service's monthly churn has doubled in a year. How would you find out why?
Checks who is leaving and where they go, what rivals changed in price or shows, and what changed in the service itself. Practice it, see a model answer
What mistakes do candidates make with the 3Cs?
The ones we hear most in practice cases.
Saying the name instead of the questions
"I'll use the 3Cs" tells the interviewer nothing. Name the questions you will answer under each C for this client.
Three lists that never meet
Facts about customers, then the company, then rivals, with no link between them. End each branch with what it means for the decision.
Only looking at rivals
Wind's point: a strategy built only around competitors misses the customer. Start with what buyers need.
Leaving out the money
A case needs a number. The 3Cs alone don't tell you whether the move is worth it, so add a size and a profit check.
Forgetting channels and regulation
Some cases turn on distributors, partners or the rules. Add them as a fourth branch when they matter.
Decide whether to go in out loud
Soreno's AI interviewer runs a full case, hands you the customer, company and competitor facts when you ask, pushes back on your logic and scores the session. Start your free week.
Questions people ask
What is the 3Cs framework?
A way to build a strategy around three things: the company, its customers and its competitors. It is also called the 3C model and is credited to Kenichi Ohmae's 1982 book The Mind of the Strategist.
What are the 3Cs?
Company, customers and competitors. Wharton's Jerry Wind describes them as the company's mission, objectives and particular characteristics, the customers' needs and how they see the company against rivals, and the current and potential competitors and how they will react.
Who created the 3C model?
It is credited to Kenichi Ohmae. Jerry Wind's Wharton paper on competitive strategy cites the model to Ohmae's book The Mind of the Strategist, published by McGraw-Hill in 1982.
What is Ohmae's strategic triangle?
Another name for the 3C model: company, customer and competitor at the three corners. Ohmae published an article in 1982 called The strategic triangle: A new perspective on business unit strategy, and a Hong Kong Polytechnic University paper uses the two names for the same model.
Should I use the 3Cs in a case interview?
Use it as a starting structure for market entry, new product and competitive response cases, and add market size and profit. Skip it for profit declines, cost cuts, operations or valuation, where other structures fit better.
What is the difference between the 3Cs and Porter's five forces?
Harvard Business School's Institute for Strategy and Competitiveness says the five forces determine an industry's competitive structure and its profitability. The 3Cs look at one company's move: who it serves, what it does better and how rivals answer. Use five forces when the question is about the industry.
What is the difference between the 3Cs and SWOT?
SWOT sorts what you know into four lists. The 3Cs make you look at the customer and the competitors directly, and ask where a need the company can meet better than rivals sits.
What is the 6Cs model?
An extension of the 3C model by Jerry Wind of the Wharton School. It keeps company, customers and competitors and adds three more factors, including channels of distribution and the wider environment, because he found the 3C model insufficient on its own for a competitive strategy.