Ralph Waldo Emerson once said, “Build a better mouse trap, and the world will beat a path to your door.” Yet, as business owners and marketers, we often fail to identify exactly what makes our products or services a better value or, for that matter, whether or not there is a real demand for our products or services to begin with.
Every year, some thirty thousand new consumer products are launched in the U.S., and over 90% of them fail. Although there are arguably a number of reasons for those failures, one key reason seems to be that businesses focus too heavily on features instead of benefits, both in their product planning and marketing.
Noted Harvard marketing professor Theodore Levitt was fond of telling his students, “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole.” In other words, to paraphrase former President Bill Clinton’s winning campaign slogan – “It’s the benefits, stupid.”
Building your brand means offering your customers products they actually want and need. To do that, you must know how your potential customers live their lives and provide simple solutions to their real world challenges.
Using Professor Levitt’s example, instead of focusing on the features and pricing of your particular drill and comparing it against your competitor’s drill, you should focus on improving the hole your drill makes.
As marketers, we often focus so heavily on the features of our products that we end up improving them in ways that are simply irrelevant to the ways in which customers actually use those products.
Customers buy products and services that help them get things done in the most efficient and cost-effective way possible.
Apple and its IPod MP3 player are prime examples of a company and a product that got it right. The IPod wasn’t the first consumer MP3 player to hit the market, but its ease of operation, affordability and increased storage capacity addressed the universal, real world wants and needs of consumers. Apple focused on the benefits instead of the features.
Many businesses also segment their customers by age, income, gender, lifestyle and other variables. In the B2B world, businesses often segment their clients into small, medium and large enterprises. They then create products or services to address the needs of a representative sampling from the various market segments. In the end, they often create products and services that don’t help individual customers get things done faster, easier or more affordably.
In the mid-90s, Quicken launched its Financial Planner software. It was a full-featured, convenient and affordable product that had every reason to succeed except one – market demand. The $49 software captured upwards of 90% of sales in the product category but was eventually pulled from retailer’s shelves. Quicken’s focus group research suggested that a large percentage of American households had the need for financial planning but, in reality, it wasn’t a job most people wanted to do themselves. Instead of purchasing a drill, they preferred to hire an individual or company that could provide the hole.
As so many businesses have learned the hard way, making it easier or more affordable for your customers to do things they have no interest in doing is a recipe for failure, no matter how feature-rich your products or services are.