January is a time for making resolutions, and that activity is not limited to individuals; companies make resolutions too by way of making solid plans for the coming year. One of the most important resolutions your company can make: market smarter.
Last week, Yahoo!’s finance segment “24/7 Wall Street” put out an article about “The Worst Product Flops of 2011.” While Yahoo! attributed these notable failures in great part to the fact that they were, “either inferior versions of already successful products or they have little to no demand,” there were other factors at play. One major aspect to consider is the role of marketing in launching new products or services. So, this week, let’s look back at the role of marketing in some of the items on Yahoo!’s list of product failures as we look forward to a year of marketing successes.
Number one on Yahoo!’s list was the “Ashley Push-Up Triangle,” a padded-bra-style bathing suit top sold by Abercrombie and Fitch’s kids’ line, Abercrombie Kids, which carries clothing for children ages 8-14. Parent groups were outraged over this age-inappropriate offering appearing in stores where people purchase clothes for their elementary school-age children, and A&F took a hit both financially and in terms of reputation.
There is a very key lesson here for product developers: properly utilize market research tools before launching new products. For small businesses, our top pick for new product focus groups is the online tool GutCheck, which offers real-time, online focus groups and surveys for small business marketing research. A&F’s misstep also offers a second cautionary tale: Know your customers. And if you don’t, then get to know them. Again, focus groups and surveys are great tools here. Additionally, a healthy two-way social media relationship with your client base can be an excellent place to test the waters by offering sneak peeks into what’s going on in product development.
Failing to listen to one’s client base was also key in the failure of Qwikster, the DVD-by-mail spinoff Netflix scrapped before it ever got off the ground. In this second item on Yahoo!’s 2011 Product Flops list, appropriate preliminary market research would have made a huge difference. Additionally, what Netflix failed to see here was one of the most important questions we should always ask ourselves before launching any product, service, or advertising campaign: From the consumer’s perspective, when s/he asks, “What’s in it for me?” what will the answer(s) be?
With both A&F’s and Netflix’s failures came public relations nightmares, and a lot of this fallout has to do with poor marketing choices. First, both products were arguably bad ideas from the start, which, of course, makes marketing efforts much more challenging. Second, the companies showed startling lack of self-awareness. And third, their official responses to public backlash were significantly lacking. Let’s look at that a bit more closely.
If either company did market research ahead of time, they didn’t do it thoroughly. That is, it’s not enough to ask focus groups if an item of clothing is attractive or if $4 a month is a good deal for getting unlimited DVDs by mail. As marketers, we have to ask detailed questions about the products we want to sell, where we will sell them, to whom we will direct our marketing efforts, and what the price point will be. What we see as a great new product idea may not be well received by the public, so it’s always important to stop and find out whether the product itself is even a good idea.
Beyond this, it’s important for companies to be self-aware. A focus group may not have a negative reaction to the question, “Would you pay $4 a month for unlimited DVDs by mail?” but if you add some corporate self-awareness to the equation, the response would likely be different. That is, Qwikster failed not because it was a terrible product or unreasonable price, but truly because it was being offered by Netflix and was therefore viewed as a price hike to current subscribers rather than a new offering. Again, think, “What’s in it for me?” The same goes for A&F. While a focus group may not have reacted negatively to the new line of bathing suits, including the fact that these would be sold in Abercrombie Kids stores would more likely have yielded a more accurate prediction of public sentiment.
Finally, there’s the response. This is the public relations side of marketing, and while PR and marketing have some separate roles, especially in larger companies, they must go hand in hand for a successful corporate image. Success in this area means knowing when to cut your losses and go with public sentiment and knowing how to go about doing it in a way that ingratiates your company with the public as opposed to exacerbating the problem.
What will your company do this year to market smarter? How will you evaluate new products and services before developing marketing plans, investing in product stock, and announcing your new offerings to the public? Need some ideas? Connect with us, and let us show you the Tribal way of marketing smarter.