The Growth Dilemma: Managing Your Brand When Different Customers Want Different Things
Annie Wilson and Ryan Hamilton
Harvard Business Review Press (June 2025)

How to navigate the perilous waters of growth through the acquisition of new customers

To what does the title of this book refer? Annie Wilson and Ryan Hamilton explain that “as brands grow, they must acquire more customers. As the customer base grows, these customers will be increasingly diverse in terms of their preferences, identities, and values. As the brand changes its offerings, to better serve one part of its customer base, it becomes increasingly less appealing to another part of its customer base. As it embraces the values important to one customer segment, it risks offending the sensibilities of another customer segment. As some customers embrace the brand as an identity marker, they alienate other customers who don’t want to signal membership in that group. The result is often conflict within the customer base over the brand that should be used, what it stands for, and whom it should and shouldn’t serve. Growth multiplies the thicket of divergent customer preferences, increasing the complexity of managing the relationships between customers to the point where conflict feels almost inevitable.”

The Segment Compatibility Matrix (SCM) proved to be of greatest interest and value to me, as it may also be for you. Briefly,  in The Growth Dilemma, Wilson and Hamilton “have organized customer segment relationships along two axes. The horizontal axis defines the nature of the value that customer segments derive from the offering and each other…On the vertical axis, we consider the extent to which customer segments are affected by the other customers who are also using the brand…Separate Communities tend to want different things [i.e. benefits, results] from the brand…For Connected Communities, the brand’s offering becomes more valuable as more people use it via network effects…Leader-Follower Segments often see Leader segments as trusted experts, trailblazing role models, or aspirational exemplars. Just buying the brand, Leaders attract Followers to use it too…Inc comparable Segments do not mix well with one another. They want divergent value from the brand, and unlike Separate Communities who can co-exist or ignore each other’s differences, the presence of one segment negatively influences another.”  All this is carefully explained in Pages 19-23.

These are among the strategic objectives that Wilson and Hamilton can help you and your associates to achieve. Each is prefaced by a HOW TO:

o Formulate a Segment Compatability Matrix
o Identify, then compare/contrast separate communities
o Learn the implications of Horizon World collapse
o Learn how and why customers clash
o Anticipate and then resolve functional conflicts

o Assess the risks of conflict
o Avoid, overcome, and/or escape from conflict
o Embrace conflict and benefit from conflict
o Combine and coordinate relationship strategies
o  Establish and sustain competitive advantage for segment relationship management

Obviously, no brief commentary such as mine could possibly do full justice to the value of the information, insights, and counsel that Annie Wilson and Ryan Hamilton provide in abundance. I hope, however, that I have at least indicated why I think so highly of their brilliant contributions to thought leadership at a time when competition for customers is more volatile, more uncertain, more complex, and more ambiguous than at any prior time that I can recall.

It is also worth noting that retaining a customer is far more difficult than adding one but far less expensive than replacing one.

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Here are two suggestions while you are reading The Growth Dilemma: Highlight key passages. Also,  perhaps in a notebook kept near-at-hand (e.g. Apica Premium C.D. Notebook A5), record your comments, questions, and action steps (preferably with deadlines). Pay special attention to each of the Figures and Tables. They provide some of the most valuable material in the book. Also, be alert to key points made in the final paragraph of each chapter.

These two simple tactics -— highlighting and documenting —- will expedite frequent reviews of key material later.