Marketing malpractice: the cause and the cure.

Ted Levitt used to tell his Harvard Business School students, "People don't want a quarter-inch drill--they want a quarter-inch hole." But 35 years later, marketers are still thinking in terms of products and ever-finer demographic segments. The structure of a market, as seen from customers' point of view, is very simple. When people need to get a job done, they hire a product or service to do it for them. The marketer's task is to understand what jobs periodically arise in customers' lives for which they might hire products the company could make. One job, the "I-need-to-send-this-from-here-to-there-with-perfect-certainty-as-fast-as-possible"job, has existed practically forever. Federal Express designed a service to do precisely that--and do it wonderfully again and again. The FedEx brand began popping into people's minds whenever they needed to get that job done. Most of today's great brands--Crest, Starbucks, Kleenex, eBay, and Kodak, to name a few-started out as just this kind of purpose brand. When a purpose brand is extended to products that target different jobs, it becomes an endorser brand. But, over time, the power of an endorser brand will surely erode unless the company creates a new purpose brand for each new job, even as it leverages the endorser brand as an overall marker of quality. Different jobs demand different purpose brands. New growth markets are created when an innovating company designs a product and then positions its brand on a job for which no optimal product yet exists. In fact, companies that historically have segmented and measured markets by product categories generally find that when they instead segment by job, their market is much larger (and their current share much smaller) than they had thought. This is great news for smart companies hungry for growth.