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Dr. Ned Roberto

‘If we go after the DE market with the best product, surely success is guaranteed?’

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Question: We’re a brother and sister team seeking to become successful entrepreneurs in the male personal care market. It’s my sister who had the idea. She told me once how I had in my cabinet more beauty and personal care products than she had. And yet, she said, “there’s no company that’s the L’Oreal, Avon or MAX Factor of the males.”

She also said that the largest need and therefore the biggest opportunity is in the Class DE market.

When we shared our ideas with our parents, our dad was very supportive and gave us initial capital to explore the cosmetics market.

My sister told me that what she learned from her college marketing course was that to succeed, our cosmetics for males should be unmistakably distinctive by being the best.

I devoted one entire year for this product development effort and we now have a line of high-quality male cosmetics of the best quality.

Our problem is cost.

Having the best cosmetics required the best raw materials and therefore high cost and high prices.

We both knew there was no way DE males could afford our prices.

But my sister said: “If we have the best products, and if we go after the male DE market with the best product line, then surely success is guaranteed.”

I wasn’t comfortable with this assumption and now seek your Marketing Rx as one of your avid readers.

Answer: The senior MRx-er will be the first to answer your question.

He will answer as a professor and therefore according to what he preaches about product innovation.

The Junior MRx-er will give his answer next Friday. He’ll answer according to his experience as a successful and multi-awarded entrepreneur.

We can look at your question as still an issue of market segmentation.

The market segmenting principle that applies says: “The ultimate source of growing your business is market segments… Even if R&D says that you have the most interesting product, if there is no market segment in need of it, you will have zero sales.”

So in the case of your male cosmetics targeted for the Class DE segment, the key is to check the DE segment’s need for “a line of high-quality male cosmetics of the best quality.”

Why should this be the key?

Is there any doubt that any consumer, whether Class AB, C, D or E, has a need for “the best?”

Of course, common sense tells us that “the best” is a consumer need.

But if a male consumer can’t afford the best, he’s almost always willing to settle for the second best or just the “better” product.

If the “better” happens to be also beyond what’s affordable, he’ll also be content with just “the good.”

In other words, the choice situation for the consumer is not between “the best” versus “the worst.”

The choice is among “the best” versus “the better” versus “the good.”

Is there any research on the DE consumers that says that when faced with good-better-best choices, they – or most of them – actually go for just “the good?”

Sales data in the pharma market for multi-vitamins, for example, tell us that given the choice among these three: Centrum (as “the best” being the premium brand), Enervon C (as “the better” being the economy brand) and RiteMed (as “the good” being the branded generic), most DE consumers will settle for RiteMed because it’s the most affordable among the three.

The choice in airline tickets is arranged in a similar good-better-best set and the DE traveler buys “the good” choice, the economy seat, as against the business class seat (“the better choice”) or the first class seat (“the best choice”).

We see this choice setting for the DE segment in so many other product and service categories that we’ve forgotten it as the “usual case,” especially when we’re promised the ideal, “the best.”

In 1985, Michael Porter, in his best-selling book “Competitive Advantage,” reduced “the best” as the model of successful product innovation.

For over a decade and a half, it was the bible of product innovation.

It sets this rule: “Successful product innovation can come from only two sources. Be the best highest quality product or be the lowest cost.”

By implication, it’s also saying that you can’t succeed by being both quality and low cost.

In 1997, this was precisely the successful product innovation model that a fellow Harvard Business School professor, Clayton Christensen, made popular in his The Innovator’s Dilemma book.

It was the model that displaced Michael Porter’s because it argued that there are more product innovations that succeeded because such a product happens to be a good product but is cheap.

This was the product innovation that particularly appealed to the DE market need.

The poor are realistic and practical enough not to crave for the best because they know the best is expensive and therefore beyond their means.

As long as the product is good but at the same time is affordable, i.e., both quality and low cost, that product is their need satisfier.

So there’s the answer to your question.

Think segment, and in your case, think the DE segment and its priority need.

Do not think of your own norm as a marketer. Always start where your target market, your consumers, are.

Keep your questions coming. Send them to us at MarketingRx@pldtDSL.net or drnedmarketingrx@gmail.com. God bless!

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Tags: Business , Cosmetics , Entrepreneurship

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