Based on a new survey worldwide, among the top concerns of C-suite as online marketing heads towards 2020 is the development of a new business model. Disruptive technology is totally changing the experience of customers as well as how customers view the value and the quality of their services and their products. The bottom line is, the no. 1 reason why new business models fail is due to poor marketing.
Let’s take customer support for example. Before, it was quite normal for a customer to contact a massive, outsourced center for software support, stay on hold for 15 minutes, speak with a representative who is barely familiar with their history and luckily, find a solution. Today, this will not do with customers. Customers expect an almost instant conversation with knowledgeable and skilled staff member. They demand online chatbots, ticketing systems for their progress and the option for auto-callback. In-house support should also be part of their option. Because of these, organizations had to adapt.
A successful business model depends on how well you know your customers, how well you explain your business model to customers and how customers evaluate their experience with your business model. These three things however, are core principles of marketing and their impact is proven throughout business history. Perhaps another flop that would highlight the points stated above is the Nook eReader by Barnes and Noble. In 2009, Barnes & Noble released the Nook to compete with Amazon Kindle and the Apple iPad. It ended in a disaster that moved Nook showcases to the back of over 600 stores in the US.
Other Epic Fails
What happened? Being the only vendor that had a massive inventory of books on the backend, Barnes & Noble had all the opportunity of dominating the e-reader market. However, due to insufficient development as well as several updates that disabled user capabilities instead of enhancing them resulted in a product that was very slow and very difficult to use. The flaw here was that Barnes & Noble focused too much on the book functionality instead of the user experience. They could have avoided this if they listened to the users’ demand for a richer tablet experience.
Another epic failure that you might already have heard of is the Ford Edsel. Ford spent more than $400 million in order to engineer the car which entered the market in 1957. In order to prepare for the car’s debut, Ford launched a very aggressive marketing strategy. The idea was to make a mystery that will shroud the car by keeping the car’s physical appearance a secret. They used ambiguous messaging such as “The Edsel is coming…” In three years time, the car was extinct. The marketing was so aggressive that it set a bar which the car could not meet. Consumer anticipation immediately flatlined after the revelation. What happened was that consumers wanted affordable, smaller and fuel-efficient cars and what they got was a flashy, bulky, gas guzzling vehicle.
Another major failure was Google Glass which was introduced in 2012. The gadget represented a really bold and imaginative push towards the future of wearable technology. It also made a loud sound all over the Internet. However, not everyone was dazzled by this shiny new head-mounted computer. By 2015, the product was pulled out by Google from the shelves. The final verdict was that the idea was bigger than the development as well as the execution strategy.
There are many things that we can learn from these epic fails. The first thing is that you need to design and develop products for your target market and not for engineers. You also need to spend less time talking about your organization and yourself and more about your customers. You should not also treat marketing as an afterthought. Nobody knows your customers better than marketing as well as sales teams. This means that they need to be invited into the development of the new business model at the base.