As companies try to gain market share, there is unprecedented pressure on marketing departments for driving growth. In the olden days, it required spending more money on advertising to create brand awareness and acquire customers. However, things are very different now, every single user is now subjected to advertising overload coupled with thousands of products in every category. Human brains are virtually numbed with the overload of information.
So, how can a company grow?
Based on sitting on pitches on many startups, I find more and more growth is not based on the ever-expanding population but more about boosting the value of products for the customers.
In today’s time, a company with a spectacular product, a great marketing campaign, and an aggressive sales force, can perish if assured expansion of demand tends to undermine a proper concern for the importance of marketing and the customer.
Another Me-too product
The usual pre-occupation of catching up all the product functionality with others in the industry derails focus from adapting to constantly changing patterns of customer needs and tastes. Some companies are so fixated on their products that they don’t see how competitors are innovating and the market is changing and does not see how their products are being made obsolete.
A classic example is the oil industry. The recent advancements working models of energy systems will replace the internal combustion engines and eliminate the demand for gasoline.
Many companies spend a lot of resources on R&D. The ideology that the product will sell itself has created companies where management continues to be oriented towards the product rather than the people who consume it. This mindset tends to favor controlled business practices where everything needs to be measured and tested. What creates a challenge is that engineers are not able to wrap their heads around the realities of the market. Consumers are fickle, shortsighted, unpredictable, and generally stubborn.
And the iPod was such a customer-satisfying product. It wiped all the mp3 players and launched a new industry with the customer needs at its center and not a new patent.
Survival is a so-so aspiration
Anyone can survive one way or the other. The trick is to differentiate and gather escape velocity. To achieve greatness and feel valor of entrepreneurial greatness. For this vision, management needs to move its focus from creating products to creating followers. In business followers are customers. And organizations need to focus on doing things that will want people to do business with them.
A leader or chief executive officer has a responsibility for creating this environment, this aspiration, and this attitude. Many inspirational CEOs come to mind – Steve Jobs, Marc Benioff, and Larry Page.