During my stint with Tata Motors, it was constantly fed into our minds that “The Customer is the King”. We were told to imbibe this into our hearts and practice it diligently.
Whatever product or services we designed, we always had the end customers and their needs in our minds. We were able to build a lot of successful products applying this thought process.
However, as a consumer, my experience has been a bit different. I see a lot of products around me that would have not been needed by the consumers but still sell in large numbers.
For example, take the case of soft drinks. My opinion is a bit exaggerated, as I do not consume them but they are nothing but caffeine and sugar mixed with a deadly concoction of chemicals and carbonated water. They have no nutritional or health benefits. Still, the global market for soft drinks is estimated at USD 739 billion in 2020. (Source)
Another case could be of dental care products especially the toothpaste. Many articles on the web suggest that there is no compulsion to use toothpaste while brushing your teeth. Using a good quality toothbrush with water would give the same result. Still many varieties of toothpaste are being sold. The global market for toothpaste is estimated to touch USD 36.98 billion by 2024. (Source)
It is very interesting to observe how a product that was not required (in the hindsight), was converted into a successful business model globally.
To understand this phenomenon, we need to understand various methodologies of product development and evolution.
Need Fulfilment
A company may conduct extensive market research and data analysis and identify certain needs of the consumers that are not being met by the current products. They design a specific product for these needs. Most of the conventional products are designed like this.
Product Improvement
Changed are made to the existing products based on feedback received from the consumers. Mostly these changes are aimed at correcting some defect or shortfall in the current product.
Initial performance of Indica (Tata Motors’ first product in the passenger cars segment) was not in line with the customers’ expectation. A few years later Tatas launched a refresh with the name Indica V2 that was a great success because they were able to incorporate the customer feedback well in the later version.
Product Enhancement
Once sales of a particular product have plateaued, the company may decide to add some new features and release a fresh version of the product. New features allow them to charge a new price or target new customer segments.
Gillette is one example. They keep adding new features to their shaving razors periodically to enhance their overall value and pricing.
Need Creation
A company has a product idea however; there are no existing consumers of such products in the market. The company therefore first has to create a fresh consumer base for such products. Initially, it may start as a niche product and later become a mass-market product if it is acceptable to the market.
Most innovative and disruptive products fall into this category.
The first two categories are strictly based on customers’ needs & feedback and hence have to be very customer-centric from day one.
For the last two, product development is driven by hunch, ideas, innovation and vision on the promoters. They have strong confidence in their product and believe that eventually, it would appeal to a particular set of consumers.
As there are no precedents, their focus is to have a solid product offering and then scout for a group of early adapters who will try, test and promote their product.
However, it does not mean that the promoters of these products do not have to bother about their customers’ needs and whims. At times, it very much possible that as they are selling a concept, they are required to be more flexible and responsive to the customers’ response and feedback. They may also end up making changes to their product on the fly to incorporate customers’ feedback.
In other words, product improvements and enhancements are quite rapid here until an equilibrium is reached between what is needed and what can be offered at a particular price point.
Conclusion
Many disruptive ideas fail despite having a good product because the promoters were unable to respond to their customers, needs in time.
The customer therefore is and would be the King. If not today then surely a few months later. This fact must be kept in mind all the time.
Whatever we are doing or planning to do, the Customer aka the King should always be the focal point of our thought process.
I am sure you shall find this article interesting and useful.
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