THE WORLD OF PURPOSE BRANDS

Designing products that meet customer needs
BY Jayashantha Jayawardhana

In the mid-1990s, Cofounder of financial software giant Intuit Scott Cook oversaw the launch of a product dubbed the Quicken Financial Planer, which helped customers draw up a retirement plan for themselves.

The planner flopped despite managing to capture over 90 percent of retail sales in its product category. But its annual revenue never exceeded US$ 2 million and the product was eventually pulled from the market.

So what happened – was 49 dollars too high a price tag? Or should it have been easier to use?

Perhaps, yes! But a more likely explanation is that although demographics suggested many families needed a financial plan, drawing one up wasn’t something most people wanted to do.

In hindsight, the fact that the design team didn’t find enough planners to fill a focus group should have alerted Cook. Making it easier and more economical for customers to do things they never intended to do seldom leads to success.

German-American economist Prof. Theodore Levitt’s famous observation that people don’t want to buy a quarter inch drill, they simply want a quarter inch hole, has become an adage known to every marketer. But few seem to take it to heart; and they often make many marketing mitakes, which cost their businesses millions of dollars every year.

Such blunders are the subject of an article in the Harvard Business Review (HBR) titled Marketing Malpractice: The Cause and the Cure, by Clayton Christensen, Scott Cook and Taddy Hall.

The problems begin with segmentation where marketers typically seek to segment a market by the type of product or customer. When maketers are obsessed with benchmarking features and functions of a given product or shoehorning consumers into age, gender or lifestyle brackets, they easily lose sight of what it’s designed to do.

This is a key reason why new product innovation has become a gamble and the odds of winning are startlingly low.

To avoid this, marketers must first grasp the real needs of customers and design products to meet those needs, delivering them in ways that rinforce their intended use.

When customers want to get a particular job done, they will purchase a suitable product. So how do marketers design such products that address customer needs?

The authors write: “With few exceptions, every job people need or want to do has a social, a functional and an emotional dimension. If marketers understand each of these dimensions, then they can design a product that’s precisely targeted to the job. In other words, the job, not the customer, is the fundamental unit of analysis for a marketer who hopes to develop products that customers will buy.”

“Pierre Omidyar did not design eBay for the auction psychographic. He founded it to help people sell personal items. Google was designed to source information and not as a search demographic. The unit of analysis in the work that led to Procter & Gamble’s stunningly successful Swiffer was the job of cleaning floors, not a demographic or psychographic study of people who mop,” they note.

Marketers’ focus on jobs instead of consumers is in the best interests of their businesses. When they segment by job, they find their market share to be much larger than when they do so by product. New growth markets are created when innovating companies design a product and position its brand around a job for which no optimal product is still available.

Cofounder of Sony Akio Morita and his associates invented the Walkman not by carrying out conventional marketing research but observing how people went about their lives, and then asking themselves how Sony’s electronics miniaturisation technology could be put to good use for them.

When consumers need to get a job done, sometimes there exists a branded product that perfectly fits their requirement. A product that’s so tightly associated with its function is called a ‘purpose brand.’

Federal Express (FedEx) is one such purpose brand with global fame. The company designed its service to meet a requirement that had existed practically forever – the need to send a package from one place to another with perfect certainty that it would happen as quickly as possible.

As the organisation became exceedingly good at what it was doing, the FedEx brand began popping into people’s minds whenever they needed to send or receive a package. FedEx became a verb in the international language of business and was inseparably connected with that specific job.

Once a strong purpose brand has been crea­ted, marketers will inevitably seek to leverage it by applying it to other products where it could degenerate into an endorser brand (with products that serve many different functions) and risk losing its original appeal.

Therefore, marketers must guard against creating these endorser brands.