There are many business pundits who firmly believe the key to marketing success always comes down to product awareness. They believe companies cannot be successful unless customers know who they are, and that means focusing significant efforts (and money) on promotion. While it is true that, for most businesses, effective promotion is vitally important if products are to succeed, for the majority of businesses it may be a major mistake to believe promotional spending is the most important marketing decision. In reality, which marketing decision is the most important can vary. For instance, for low-cost airlines, that essentially offer the same services, pricing decisions may be the most critical. For quick-stop gasoline stations, the many concern may be outlet location, which is a distribution decision.
While promotion, price or distribution may be at the head of the task list for some marketers, for the vast majority of marketers, who produce their own goods and services, the biggest marketing concerns deal with product issues. For these marketers, everything starts with finding products that customers will want. If they do not want the product, no amount of spending on promotion or lowering price or providing effective distribution will help.
The issue of marketing desirable products is especially a challenge in industries who are apt to experience rapid change, such as computer, home entertainment, smartphone and other technology-heavy industries. But product design is also on the front burner of companies in low-tech industries, such as consumer foods, greeting cards and fashion. These industries, along with many more, realize that a poor effort in new product development is a recipe for disaster that may prove fatal.
Sometimes, though, struggling companies, which have either lacked a strong focus on product development or have done it poorly, can recover by altering how they carry out the design process. However, changing how things have been done may not be easy, particularly if company personnel are resistant to making the adjustments that are necessary for adopting new methods for innovative design.
A good example of a company that faced the tough times and made the necessary changes to improve product development can be found in this Fast Company story. It discusses how Denmark's The Lego Group, marketer of the popular Lego toy brand, was in trouble ten years ago and on the verge of going bankrupt. The leading cause of their problem was product development that was not focusing on what customers (i.e., kids) really wanted. Things changed when a new CEO was brought in and instituted creative methods for carrying out product development. The result is a company that is now not only a leader in toy development, but a model for how most companies should approach product innovation. This story, along with another Lego story we noted back in 2010, should serve as must-reads for anyone involved in product decisions.