Condos in Miami, traditional music stores, gas-guzzling cars, pharmaceuticals that get bad press and foods made with fats: All marketers, from time to time, confront products that, for whatever reason, become difficult to sell.
While the ultimate goal of marketing is to target products to customers who are ready to buy occasionally products or services require an additional push. When that happens, marketers need creative ideas to tide them over until the market returns, or the company is able to change strategic direction, according to marketers.
From the individual marketer’s point of view, there are times you feel selling something is impossible. But if you think more about it, there are so many different kinds of customers out there. You just need to find them.
If customers aren’t buying, more often than not it is an indication that a company is targeting the wrong people. We all know the saying about one man’s trash being another man’s treasure, and you just need to find the man who treasures your trash.
To find that man, a company must study its market and customers, figure out why its product is or is not clicking with certain segments, and decide what buttons it can push to get targeted customers excited. Going through a systematic, rigorous process of segmentation, targeting and positioning, an age-old marketing approach, is much easier than finding a man who loves your trash.
A selling job is always difficult if you don’t really know your customers well, and if you simply make projections based on your own experience and intuition. Marketers must put themselves in the shoes of customers and think critically. You may find the selling job is not impossible.
When a product or service becomes a tough sell, it’s because customers have obvious objections to it. The goal, therefore, should be “to frame an offer to get rid of the objection.”
For example, in response to concerns about high gas prices, a car dealer can offer free gasoline to move SUVs off the sales lot. That may only work for customers who object to SUVs because of the price of gas. It won’t work for customers who have turned against the product based on concerns about the environment.
At Lynch Hummer in St Louis, Mo., the world’s largest seller of new and pre-owned H1 Hummers in the world and one of only two dealers that sell Hummers and Hummer parts exclusively, the strategy is to remain focused on the vehicle it knows best, but also to develop new lines of business.
The company has already been through several cycles of Hummer ups and downs since the H1 was introduced to the consumer market in 1994. Most of the swings were due to inconsistent production.
As a result, the dealership has always been closely attuned to its customers to keep them interested when supplies were limited, as well as when supplies were plentiful. They never sacrificed customer service or satisfaction.
The company is now expanding its business into pre-owned Hummers, parts and accessories for Hummers, and other cars and trucks. Retailers also face situations where consumers hesitate to buy a new product because they have a similar product that still works. Auto marketers addressed this issue by encouraging vehicle trade-ins, an idea that might also work for other products.
People are more willing to buy a new item for a trade-in discount than they are for the same discount without the trade-in.
For example, someone might want a new digital camera with more features than the camera he or she already owns. A savvy retailer can offer a trade-in discount on the old camera, even if there is no market for the used camera. In this case, the objection is, ‘It still works and I haven’t gotten my money’s worth,’”
Rolling the perceived value of the old item into the new purchase seems to nullify that objection. It has to be the case that the person wants the object, but something is in the way. That’s where creativity and understanding the customer’s perspective is important.
Business cycles can make certain products difficult to move until excess inventory or confidence in the market returns. At the moment, real estate is in one of its cyclical slumps, and in some markets it is not clear where the floor will be.
In this case, marketers need to think seriously about adjusting their price until the market corrects. At some price, [developers] will sell all those condos in Miami. Pricing is a critical element of successful marketing, in good times and in bad, and many companies do not focus enough on getting their pricing right.
Marketers need to consider not only the value of the physical assets for sale, but also non-tangible elements that play into what consumers will be willing to pay.
Sellers in this situation are to identify the most recent buyers, even if there are only a handful of them, and try to find other people in the same category. For example, a few venture funds active in the condo market in South Florida are willing to buy if they can assemble entire blocks of condos. Once you find out who the buyers are in today’s market, you can expand on that.
Some products, like SUVs and real estate, take time to respond to market demand. For example, an automaker needs about four years to readjust its production capability to respond to changes in consumer trends. Marketers should rely on pricing and sophisticated segmentation of the consumer market to find buyers who might still be interested in the waning product.