Optical Distortion (aka the Chicken Contact Lenses Case)

09.12.2016 |

Episode #7 of the course Most influential business school case studies by Magoosh

 

This case is about one of the more bizarre subjects that a business school student will encounter, but its unfamiliar subject matter allows students to really focus on the business concepts at play. In particular, this case provides excellent fodder for a discussion on marketing new products and designing a sales launch. It also happens to be about contact lenses designed to reduce the vision of chickens.

In 1962, a farmer in Arizona discovered by accident that a group of chickens suffering from a severe case of cataracts ate less, were easier to handle, and got into fewer fights resulting in injury or death to the birds. The result was that partially blinded birds were far more profitable than their fully sighted counterparts. An idea was born—figure out a way to similarly reduce the vision of the nearly half-billion chickens in the US. Optical Distortion, Inc. was formed to tackle this opportunity.

ODI developed a lens that would partially blind the chickens and spent years developing a method for insertion and retention that would make the lenses easy to use. The lenses reduced chickens’ field of vision and created distortion; they could see enough to live, but the decreased vision prevented fighting and other unwanted behaviors. Moreover, the lenses were colored red, which created a psychological effect that further reduced chicken violence and cannibalism. The lenses were more effective than de-beaking and required less effort on the part of the farmer.

ODI was granted a patent for its lenses but also knew that bigger players in the agriculture industry would get around that patent in due time. In order to build a successful business and capitalize on the development of their product, they had to plan a marketing program and product roll out. As a startup company, ODI also had to plan for fast expansion in order to quickly claim and then defend market share. Further, ODI knew that a business based on one product was unsustainable; they needed research and development to identify new market opportunities.

The ODI case is a fascinating study of the gigantic opportunities that can be found in the least sexy parts of the economy. It walks students through the early days of a small business going after a huge market, asking readers to negotiate the murky waters of pricing, manufacturing, distribution, marketing, and strategy.

 

Recommended book

“Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant” by W. Chan Kim, Renée A. Mauborgne

 

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