Businesses come in infinite shapes and sizes, but there are two types in particular that between them define all. The first are product led — the exploiters. They make stuff and then go out and persuade people to buy it. The second group are consumer led, comprising businesses that use their skills and experience to make things that people actually want or need. These are resolvers. Exploiter or resolver, where does your business fit in and why does it matter?
The resolvers get it, which is why, for so many reasons, they are the businesses enjoying success today.
In fact, the first group are well past their sell-by date. Exploitation is how many businesses used to operate. They were less understanding of consumer needs, but that didn’t concern them. They made stuff, whatever it was and then tried to persuade people they needed it. A few may have deluded themselves they were responding to demand, but with limited technology their insights were confined and their responses so-so. In fact, most of the things we bought in the past were, at best a near miss, a compromise.
It’s not difficult to differentiate an exporter or resolver. A sure sign that you are in the company of an Exploiter is the phrase “creating demand”. If you make things that are genuinely useful the demand, by definition, is already there. You don’t need to “create” it.
That’s why we had salespeople and the reason they got a bad name.
A salesperson’s job, by definition was to persuade people to buy compromised solutions. Poor quality stuff, things they didn’t want or which they had no real need of. Their businesses did this simply because it was the closest the organisation can get to something that was genuinely useful, with the skills and experience it had.
There’s no excuse for being an exploiter these days. We have readily accessible technology that gives any business that genuinely cares, a clear understanding of what people really want and/or need and that same tech will enable them to make it quickly and efficiently, thereby delivering it at the cheapest possible price.
It makes sense too. If you are satisfying a genuine, need you don’t have to invest in persuasion. Customers come to you and they tell their friends how great you are.
I’m not going to get into the question of whether, given the state the world is in, we should even be pandering to wants rather than catering for needs, right now. Nor am I going to go on about the businesses that, instead of passing on the savings tech provides to consumers, pocket it. My focus today is the imminent and deserved demise of the exploitative businesses that are still clinging on and making sure you don’t become one of them. Because, believe me, the end of their particular road is very much in sight.
The thread of many a debate is lost in nomenclature, so I should start by defining “marketing”. Yes, it sounds a bit basic, but I keep encountering people who use the term to describe what is really only communications. So let’s get this straight right off and agree that marketing is “the process of aligning organisations to opportunity”. It’s not advertising, content, design, social media, logos, packaging or any of that stuff. All of these things have a role to play in marketing, but they are not “it”.
No! In a nutshell, marketers discover a need, assess the capability of on organisation, determine how close the organisation can get to delivering the solution with the skills and experience at its disposal and develop a strategy for making up the difference, which doesn’t involve a load of fast-talk circumlocution, or bullshit..
Doing this right involves all the usual disciplines commonly attributed to marketing, including product development, recruitment and training and logistics, but extends far beyond that to every area and every level of an organisation. In fact every business today is a through-and- through marketing business.
If you are with me so far the next bit will be easy.
We have needs today we couldn’t have imagined three years ago.
Yes, real businesses — the resolvers — satisfy needs. The trouble is those needs change and they are doing so with increasing rapidity. In the UK alone we only need to look back at the last three years or so to appreciate how world events can bring about massive changes in circumstances and therefore peoples’ needs. Brexit, covid, the war in Ukraine and the resulting global inflation we are all feeling right now, have each in their own way prompted changes in our values, priorities and needs. So, if you are in the business of satisfying needs it stands to reasons that right now you’ll be selling things you hadn’t thought of even producing a few years ago. If you are not, the chances are you are at best on the dividing line between exploiter or resolver and on that road to nowhere!
Last week the author, speaker and Professor at Columbia Business School, Rita McGrath was quoted in a post on LinkedIn talking about this and I’ve written and spoken about it many times over the years. Forget the products you make today, they aren’t so important. They are unlikely to matter at all tomorrow.
Products are increasingly transient.
Back in the eighties, Tom Peters related how he bought the most up-to-date computer he could find in Silicon Valley only to be told by his son when he brought it home that he had bought the “old version”.
For decades, most businesses have had two or three new generations of their products in development at any one time, which has brought to life the notion that anything you can buy is out-of-date. However, it’s no longer about iterations of existing products, but entirely new ones. Maybe even things with no relationship to those that preceded them. During the Covid pandemic the vacuum cleaner manufacturer Dyson were making respirators for the NHS simply because they recognised a need that their skills and experience could resolve — that’s marketing. Another of the most dramatic demonstrations of marketing was by the pharmaceutical companies who switched, literally overnight, from chasing the cure for cancer to finding the answer to Covid.
The difference between being an exploiter or resolver is often highlighted in the world of start-ups. Investors often complain that founders are too product focussed. What they usually mean is they are so absorbed by the often years they have spent developing an invention. Years, during which, if there was ever a demand in the first place, this demand will have disappeared rendering the product irrelevant. These start-ups look for investors to pay for the extensive marketing communications required to persuade consumers that the product is essential to their lives. Most investors will run a mile from a start-up like this and I’ve personally had to break it to many aspiring entrepreneurs that their “big idea” has no point and they have no business.
I advise businesses to use today’s technology to better understand society, identify the problems we all face day-to-day and establish how we resolve them now. If you can imagine a better way of overcoming these real problems, that could be the seed from which your business will grow. Avoid the temptation to “invent” problems because you have the solution, which a surprising number of businesses still do. This certainly applies to start-ups, but it’s also true of established businesses. In fact the realisation that it’s the road to ruin is often what persuades them to embark on transformation.
I have helped organisations around the world who had been struggling with transformation, get back on track and fit for the digital economy. Most ended up producing new products. Many of those products bore no relationship to those they may have built their business on and a few were in entirely different sectors.
The digital age magnifies everything, including the difference between exploiters and resolvers. Have you asked yourself lately which kind of business you are? Exploiter or resolver?
Phil Darby
June 21, 2023