Marketing Breakthrough Products

How do you sell something that no one’s ever seen before? That’s a question many companies, particularly Internet startups, are struggling with today. Think of all the radically new products and services that have been introduced in just the past few months. There’s Third Voice’s browser plug-in, which allows people to post comments on any Web site. There’s Engage Technologies’ target-marketing system that lets Web sites track consumers’ preferences without having to know their identities. There’s Accompany.com, which lets individuals band together to get volume discounts on consumer goods. Because such breakthrough products don’t connect easily with buyers’ existing needs and expectations, traditional marketing programs such as in-store promotions, direct marketing, and print and broadcast advertising often don’t do much good. After all, those programs assume that customers understand the usefulness of the product and know how to evaluate its features. Products without precedent need an entirely different marketing plan—one that stresses education over sales. Consider the experience of WebTV Networks. The potential seemed huge in 1996 when WebTV started to sell its Web surfing device for TVs. Internet usage was exploding, and nearly every American household already had a television. It seemed like a ready-made market. Supported by the marketing muscle of Microsoft, its parent company, WebTV launched a traditional marketing program that included heavy investments in advertising and dealer training. But sales didn’t skyrocket, they fizzled. Company executives were at a loss. It wasn’t until Philips Magnavox entered the picture that things changed. Philips was hired as a manufacturing partner, but its most important contribution actually came in the area of marketing. Through research, Philips determined that its target consumers stayed away from WebTV because they didn’t understand what the device—or more generally, what the Internet—could do for them. Philips also found that salespeople at retail outlets weren’t devoting sufficient time to explaining the product to customers; they gravitated toward easier-to-push items like TVs and VCRs, which customers understood. And so Philips launched an initiative to educate customers. It developed infomercials featuring customers who explained the benefits of the Internet overall and WebTV in particular. The TV spots began airing in May 1997 and were a huge hit. WebTV hookups increased sevenfold in a year. The Philips campaign succeeded because it eschewed traditional product marketing for what we call “concept marketing.” The first goal of concept marketing is to explain the concept underlying the product—to precondition the market. Only then does the focus shift to sales. The typical concept-marketing process has three stages: educating customers so they understand and buy into the need; helping consumers understand the different types of products and services that satisfy the need; and giving them evidence that your company and its offerings best fill that need. Surveys and focus groups can help determine how your customers progress through the stages, and marketing programs can be geared to the audience accordingly. One last piece of advice: concept marketing is most effective when sellers use nontraditional methods of communication—“high bandwidth, low bias” channels—to get their message across. As the name suggests, such channels allow sellers to provide a great deal of information (high bandwidth) through media that are inherently more credible (low bias) than straightforward advertising. The use of books, infomercials, public mentions by credible individuals, and presentations at conferences and forums, for example, will get the word across more persuasively than a 30-second ad will, even in prime time.

Marketing Breakthrough Products

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