The Idea in Brief
Thirty thousand new consumer products hit store shelves each year. Ninety percent of them fail. Why? We’re using misguided market-segmentation practices. For instance, we slice markets based on customer type and define the needs of representative customers in those segments. But actual human beings don’t behave like statistically average customers. The consequences? We develop new and enhanced products that don’t meet real people’s needs.
Here’s a better way: Instead of trying to understand the “typical” customer, find out what jobs people want to get done. Then develop purpose brands: products or services consumers can “hire” to perform those jobs. FedEx, for example, designed its service to perform the “I-need-to-send-this-from-here-to-there-with-perfect-certainty-as-fast-as-possible” job. FedEx was so much more convenient, reliable, and reasonably priced than the alternatives—the U.S. Postal Service or couriers paid to sit on airlines—that businesspeople around the globe started using “FedEx” as a verb.
A clear purpose brand acts as a two-sided compass: One side guides customers to the right products. The other guides your designers, marketers, and advertisers as they develop and market new and improved products. The payoff? Products your customers consistently value—and brands that deliver sustained profitable growth to your company.
The Idea in Practice
To establish, sustain, and extend your purpose brands:
Observe Consumers in Action
By observing and interviewing people as they’re using products, identify jobs they want to get done. Then think of new or enhanced offerings that could do the job better. Example:
A fast-food restaurant wanted to improve milk-shake sales. A researcher watched customers buying shakes, noting that 40% of shakes were purchased by hurried customers early in the morning and carried out to customers’ cars. Interviews revealed that most customers bought shakes to do a similar job: make their commute more interesting, stave off hunger until lunchtime, and give them something they could consume cleanly with one hand. Understanding this job inspired several product-improvement ideas. One example: Move the shake-dispensing machine to the front of the counter and sell customers a prepaid swipe card, so they could dispense shakes themselves and avoid the slow drive-through lane.
Link Products to Jobs through Advertising
Use advertising to clarify the nature of the job your product performs and to give the product a name that reinforces awareness of its purpose. Savvy ads can even help consumers identify needs they weren’t consciously aware of before. Example:
Unilever’s Asian operations designed a microwavable soup tailored to the job of helping office workers boost their energy and productivity in the late afternoon. Called SoupySnax, the product generated mediocre results. When Unilever renamed it SoupySnax-4:00 and created ads showing lethargic workers perking up after using the product, ad viewers remarked, “That’s what happens to me at 4:00!” SoupySnax sales soared.
Extend Your Purpose Brand
If you extend your purpose brand onto products that do different jobs—for example, a toothpaste that freshens breath and whitens teeth and reduces plaque—customers may become confused and lose trust in your brand.
To extend your brand without destroying it:
- Develop different products that address a common job. Sony did this with its various generations of Walkman that helped consumers “escape the chaos in my world.”
- Identify new, related jobs and create purpose brands for them. Marriott International extended its hotel brand, originally built around full-service facilities designed for large meetings, to other types of hotels. Each new purpose brand had a name indicating the job it was designed to do. For instance, Courtyard Marriott was “hired” by individual business travelers seeking a clean, quiet place to get work done in the evening. Residence Inn was hired by longer-term travelers.
Thirty thousand new consumer products are launched each year. But over 90% of them fail—and that’s after marketing professionals have spent massive amounts of money trying to understand what their customers want. What’s wrong with this picture? Is it that market researchers aren’t smart enough? That advertising agencies aren’t creative enough? That consumers have become too difficult to understand? We don’t think so. We believe, instead, that some of the fundamental paradigms of marketing—the methods that most of us learned to segment markets, build brands, and understand customers—are broken. We’re not alone in that judgment. Even Procter & Gamble CEO A.G. Lafley, arguably the best-positioned person in the world to make this call, says, “We need to reinvent the way we market to consumers. We need a new model.”
