Who has the need and is it a problem?


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The”Dragon’s Den” is a very successful television series. Every week, would be entrepreneurs bring their products seeking to entice the star “Dragons” to invest their money into a new venture, in return for a small amount of equity in the new business.

In many cases, the entrepreneurs bring innovative products as solution to the various “problems” that they have identified. But however well a product or service is developed to answer a specific need or problem, the most important question is ‘Who actually has the need and do they consider it a problem?”

The old “Innovations” catalogue that used to be inserted into the weekend papers was famed for its ingenious gadgets and labour saving devices. Some of these devices sold well and continue to do so, as evidenced by their continued advertising. Other products disappeared into oblivion. One of the reasons why products disappeared is not that they did not work or that they did not solve a problem, but that not enough of the target audience had the problem, or if they did, did not perceive the problem required specialist resolution.

Creative people can be the life blood of successful marketing, but at the same time, misdirected creativity can lead to expensive failures. Why is this? Newly developed products and services rely on perception of their creators to interpret correctly the needs of the potential market. The results may be an innovative and imaginative solution, which is readily accepted by the potential market. Difficulties arise when the product creator perceives a problem differently from that of the potential customer. Alternatively, the created product or service provides a solution where the potential market does not recognize there to be a problem.
Commercial managers are responsible for producing and maximizing profitable income by satifiying customer requirements, for the long term interest of the organisation or company. In order to maintain and develop profitable income, commercial managers must always seek new product opportunities, in order to replace those products that are reaching the end of their product life through obsolescence, changed technology, or social requirement.
Developing new products and services to meet newly perceived market demands is particularly difficult. When considering new product development, what should the commercial manager do? Using good marketing research is the obvious answer, but such research may be used in two different ways. The first may be the constant monitoring of the state of the market, in order to identify trends in customer requirements. The second may be directed to researching specific perceived needs and problems. However, if you ask the wrong questions you will surely get the wrong answers.
Despite market research indicating a low level of interest in the concept, the Sony Walkman was a runaway success. Other products by contrast have failed despite research showing the market’s interest. Generally, it is easier to get an accurate assessment of potential customer interest in a product, if there is at least a prototype that can be demonstrated. Experience shows, as in the case of the Sony Walkman, that when research is confined to ideas and concepts, the results are far less reliable, owing to the assumption of knowledge and understanding, based on communication. In Sony’s case, they ignored their negative market research and launched the Walkman to great success. Unfortunately, such success may have lead Sony to conduct insufficient market research prior to commercializing its e-Villa Internet appliance, which was intended to enable consumers to have internet access from their kitchens. The product was large and too heavy to lift at 32 pounds, and consequently it failed to make sales, being withdrawn after three months.
When considering a new product or service, the commercial manager needs to ask some basic questions to test the concept, before committing to investment on product development.
* Is the purpose of the concept clear?
* Is the customer’s problem clearly identified?
* What is the specific nature of potential users’ requirements?  Can this be identified?
* How are existing products or services used, i.e. for how long, how frequently, for what precise purpose? 
* What difficulties do people face in using existing products and services?
* What requirements are not being met? 
* To what extent are users of current products and services satisfied with them and their suppliers?
* Does the product or service meet an identified problem?  How do you know?
* Can potential users be persuaded of the product’s benefits?  If so, how?
* Is the price reasonable in light of the concept’s perceived benefits?
* How likely are potential users to buy the product or service?
* How many of these questions above can be verified by confirmed knowledge and research?
Bringing new products and services to the market always incurs a certain amount of risk, in time, resources and finance. The overriding problem with such research is to ensure that when testing a concept, the resulting information is credible and accurate. All too often, product development can be initiated on a “gut feeling” based on what we want to hear and believe, rather than on reliable evidence.
When all is said and done, while you may have developed the solution to a perceived problem, you have to be sure that the potential market perceives the problem and proposed solution in the same way.

Nicholas Watkis, AE MA DipM CMC FCIM
Nicholas Watkis set up Contract Marketing Service in 1981, providing professional interim marketing management for a wide variety of businesses. Over 30 years practical experience in organizations, large and small, national and international, led to the development of Business Performance Maximized specialist in marketing performance measurement.


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