Focus on your customers instead of your products

What business are you in? The way you answer that question will determine the long term success of your brand. If you answered that question by naming the product you sell, it is critical to expand that view of your business. Instead of focusing on your product, focus on your customers' needs. Whatever product you offer, you are really in the business of fulfilling certain needs. If necessary, shift your focus to meet these needs even if that means abandoning your product. In fact, if you focus on only the product, you are bound to become obsolete.

All industries go through distinct life cycles, from growth to maturity to decline. During the growth phase and maturity, it is easy to assume that the decline is nowhere in sight, but history tells us that all product life cycles will eventually come full circle. By focusing on consumer needs, your strategy will evolve with your market and organically adapt to changes in customer demand. A narrow focus on the product, however, will surely result in obsolescence. It is easy to become complacent during the growth and maturity stages of a product's life cycle but a lack of innovation to meet your customer's needs will ensure a quick decline once these needs begin to change.

Take the example of the railroad industry. The railroad companies stopped growing because their executives incorrectly assumed that they were in the railroad business instead of the transportation business. They viewed themselves as providing a product instead of serving customers. Instead of figuring out ways to provide a better transportation experience for their customers or improve transportation as a whole, these companies focused solely on keeping the railroads running efficiently, even as the railroads were in obvious decline. A recent ad campaign for Amtrak asks viewers, "What if you could redesign business travel from scratch?" The answer highlights the way that Amtrak's service addresses various pain points typically associated with other forms of business travel. Judging by this ad, it seems that the railroad executives may have finally figured out that they are in the transportation business.

Instead of asking "What business are you in?" maybe you should be asking "What need are you fulfilling?". Forget your product and focus on your customers - that is the key to sustainable success.

This post was inspired by the 1960 Harvard Business Review article "Marketing Myopia" by Theodore Levitt and summarizes many of the key points outlined in that article.


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