Know-How Exchange : Just for Fun

Depends on how you define "success" and what you mean by "market oriented."

If "market oriented" means "satisfies important consumer or customer needs," then I don't think there are any "successful" companies that are not market oriented.

And if "success" is measured in long-term profitability, then my paragraph above still stands.

Keep in mind, though, that not all firms are seeking long-term profitability as the goal, and sometimes a not-so-important consumer or customer need can have short-term appeal. (Think fad products ...)

I suppose that if all companies in a given sector produced exactly what their market research told them that their market wanted, then they’d all end up producing something which was remarkably similar. Look at mass market, mid range cars in the 1990’s when everything became bland, anodyne and frankly boring.

Then along comes Renault and say’s stuff the market research lets make a small people carrier. OK no one’s asked for one and in a way; the estate cars with 7 seats fill the niche but let’s do a mini-Espace. Gosh went the buying public, what a good idea and about 10M sales later (It feels like it) Renault must be very happy.

They must have gone mad in fact because they allowed their own version of Dr Frankenstein to create a limo with a Z bed in its rear screen – I can’t even remember the name. No one wanted such a design before production and after production, no one wanted to buy one. These both highlight the hazards of not pandering to a known market and the value of a rubbish product in terms of global ridicule when you compared it to the Espace and the Megan. Sales of these went up whilst the Z-Car stayed collecting dust. Cunning folks these French!

Perfume is another example – no one knows whether anyone will like the smell of a new perfume until it is launched so to an extent it creates its own market on release. I can’t remember my daughter pestering me to write to Victoria Beckham asking her to get her skates on and decide to launch some scent in an expensive bottle, expensive box and backed by an expensive advertising campaign. Only Victoria knew that once her name was appended to anything with a reasonable smell, would it shift like sh*t from a shovel! Gabby? She’s remained loyal to Chanel at vast damage to my wallet but her palls all went out and bought something they’d never asked to be made and never asked for in a shop.

Producing product without finding out whether the market needs it or even wants it is a giant leap of faith and most products fail. Take the Dyson triple vortex bagless vacuum cleaner. All of the major manufacturers couldn’t see the point – bags were cheap and easy to replace and who noticed that the “suck” dropped by 80% after about 5 minutes of use. What more, they had a vested interest in the manufacture of branded bags. So James Dyson was told to bugger off and instead he went and got the finance and made it himself. The first cyclone takes out most of the dirt (About 99%) the second takes out another 95% and the last about another 95% of the particles left – so little dust does this process leave in the air stream there isn’t even a need for a filter. No clogged bags or filters.

Sure, the market “would like” no loss of suction (if It’d ever thought about it), no dust (Asthmatics only in the then market) but it didn’t want a price which would make the average buyer boggle. Boggle they did but they did not walk away (The market said the opposite from the surveys) They sold by the skip load, generated easy publicity – novel, techno chic, etc but designed for a problem you didn’t even think you had.

When the mainstream manufacturers discovered that they had turned away a potential golden egg laying goose, they said, “What the hell, we’ll make one too” Well the market does not like imitators and Mr Dyson’s Lawyers liked them even less, so for another Giga-Buck of publicity and a Hundred mega Bucks of damages, he sued for patent infringement and won.

That’s why other bagless vacuum cleaners still have that blasted air filter which needs cleaning every 10 minutes and why Mr Dyson can still sell a vacuum cleaner which the market never asked for the price of new silencer (not that it needs one) on the Bentley.

Steve
Xspirt