5. MARKETING OF NEW PRODUCTS
5.4 D IFFERENT CATEGORIES OF BUYER AND USER
Figure 5-4: When the customer is placed at the centre of marketing activities, the product becomes merely a part of the total offer
Figure 5-5: The number of first-time buyers of an article/product (or an opinion) is small at first, and will then increase and peak. The theoretical curve will then turn down until the product is removed from the market. Innovators and Early adopters form the group Pioneer buyers
Even though each person has a basic mindset that fits one buyer category more than another, we act in different ways with regard to different situations and to different products and opinions. Most people therefore can certainly remember being ahead of most or many others as regards some purchases or opinions. In other cases they have waited before accepting a new product or opinion until others appear to have accepted them. Thus there are no pioneers who act as pioneers in every situation. However, the probability that a clear pioneer in one respect is a pioneer also in another however is greater than that a clear latecomer should suddenly act like a pioneer.
The normal distribution curve in figure 5-5 is meant to provide a mental picture of what in principle happens to a product on the market during the entire commercial product lifecycle (PLC) (c.f. figure 1-1), i.e. from its launch on the market until it is removed from the market by the company. In reality the curve is only very rarely normally distributed: it is usually biased one way or the other for each individual product. In certain cases the number of pioneers is only a few per cent of all first-time buyers, while in other cases it could be around ten per cent of all first-time buyers if the product is longed for and meets a pent-up need. Due to natural disasters, military and trade conflicts, terrorist attacks, or due to new laws and regulations, sales can abruptly cease. Even if a new product is in great demand – e.g. a vaccine against a disease – and the number thereby can be appraised, it is difficult to estimate time-wise how sales will take place in reality, as marketing and sales are merely two influencing factors. Other equally important factors are for example the purchasing power of the target group, the economic climate, weather conditions, competitors’ countermoves, sales channels, political measures, etc. Extensive business planning before market launch is therefore often wasted time and money.
Time from introduction Number of buyers
34 %
(Early majority) 34 %
(Late majority)
16 % (Laggards) 13,5 %
(Early adopters) 2,5 %
(Innovators)
Time from introduction Number of buyers
34 %
(Early majority) 34 %
(Late majority)
16 % (Laggards) 13,5 %
(Early adopters) 2,5 %
(Innovators)
The important point to bear in mind regarding figure 5-5 then is that there are different buyer categories with different preferences, buying behaviors, etc. Without this insight, marketing - and sales - will be ineffectual. An entrepreneur, who for example thinks that his company can skip the pioneer buyers and aim the drive at early majority buyers, is not likely to be especially successful.
Pioneers are persons who by nature often want the latest type of products and enjoy displaying their new products. Pioneers therefore are a kind of ambassadors for their new products, provided that they are not too dissatisfied, for example with the quality.
In general they are also prepared to pay a high price simply to be first to own their new product. There are pioneers both for the consumer product category and for example among buyers of hardware for a company. Constructers, buyers and secretaries then can be divided into the different buyer categories. It is important to remember also that those who make purchasing decisions regarding a new product never are companies, but one or more individuals in the company.
Even if it is wishful quickly to reach the early majority group of first-time buyers, it is thus not possible to reach this group without first having won the pioneer group. For this reason, it is an erroneous approach to carry out price and perception control of a statistically selected group before the launch of a new product. Tests like this will show a forced situation where time is frozen at a stage later than the initial stage.
When sales then take place, time is moved back to point zero. If one goes by statistical tests then one’s aim will usually be wrong. This is because one then tries to sell the innovation to the majority group of buyers – which time-wise is not prepared to buy the product. At the same time, the pioneers will not want the product, since it is not made for them. Although one feels that one has done everything right, sales are often poor if faith has been put in this type of statistics and statistical surveys.
The only initial interest one should nurture when marketing new products is in finding out how some pioneers perceive the product. If possible, as we have mentioned previously, before developing and manufacturing the product, one should also sell the product concept to a single representative of these pioneers. Thereby the product will be used and evaluated at an early stage, while this will help the product developers to focus their efforts on producing a product that is attractive to the buyer. When, after possible modifications and new user tests, the time arrives to sell the product on a broad front, it is also time to concentrate efforts on the pioneers. Recurring market tests, then, give a picture of how quickly the product is accepted on the market, whereby it is possible later to produce the right curve as regards first-time buyer behavior. Such knowledge can be of great value before a launch on markets in new geographical areas and also before subsequent launches on the home market.
When customers/buyers and users are not the same person, the focus must be on pioneer users and not on pioneer buyers. If the pioneer users are not satisfied with the product and what surrounds it, they will inform the pioneer buyers of their negative opinions, whereby it will be difficult to get sales off the ground. Buyers/users with negative opinions will also inform many others of their adverse experience, which
further will hamper sales efforts. If this happens, then there will be a drastic rise in the cost of marketing to counter the negative marketing that takes place outside the company’s control.
If the company, salesperson or pioneer buyer gives away the product to a user/consumer who mentally belongs to a later user category, this user will often not use the product voluntarily. Worst of all is if the pioneer buyer gives the product to a user who is a latecomer by nature. One can then be practically sure that the product will not be used. If for example a seller of treatment equipment does not find one or several pioneer users among care personnel, the product will remain unused no matter how good the seller’s contacts are with the medical authorities’ buyers. In this case it is often necessary for the seller instead to interest a "pioneer patient" in the product, who dares to test it. It is also important to ensure that health and safety officers and doctors form a favorable opinion of the product. Successfully to establish a new product means putting the focus on finding and linking as many pioneers as possible, among buyers, users and other influential persons.
When many individuals influence the purchase of a product, and marketing and sales include this in their planning, one can speak of relational marketing. Gummesson (2002) has identified 30 important relations (30 Rs), which should be considered in connection with relational marketing. These 30 Rs are divided by Gummesson into classic market relations, special market relations, mega-relations (relations above the market) and nano-relations (relations below the market, i.e. directed towards the company). In practice however it is sufficient to remember that a deal is often based on relations in many directions. A patient hoist for example generally has one buyer/customer (the medical authorities’ buyer), many users (e.g. paramedics, nurses, patients and relatives) and many pressure groups (doctors, health and safety officers, relatives, supervisory authorities, etc.). Each of all these or other categories affects the company’s possibilities to sell its product.