Marketing Technology May the best product win?
When it comes to selling a technology product, it is not always necessary to have the highest number of features, the most cutting-edge innovation, the fi nest quality or even the most useful product, in order to capture the market.
By Kalaivani Karunanethy
Why do Singaporeans prefer Apple iPod MP3 players over those by the home- grown Creative brand, even though Creative players have similar or better features and capabilities? Why do Nokia handphones rule the market in many countries around the world? Why do people insist on Intel Inside when buying computers? In high-tech marketing, it takes more than a good product to win the market.
There are many other factors which often determine which products customers choose and end up becoming the market winner. Factors such as having a strong brand and/or, a really, really good advertising campaign on an (almost) unlimited budget.
What’s in a name?
It has been proven that consumers are willing to pay more for a recognised brand that they trust, as much as 10% to 20% more. This is called “Brand Equity”. In fact, the value of some brands can be worth much more than the company’s physical assets!
This is especially evident in high technology markets where consumers are faced with complex, esoteric technology that most will not understand. So they rely on the brand to guide their buying decision. Intel, for example, has managed to turn their product, an invisible component inside computers, into a key selling point by using good public relations and marketing to gain customers’ trust. Of the 100 Best Global Brands named by BusinessWeek and Interbrand for 2005, three consumer technology companies ranked among the top 10, including Microsoft, Nokia and Intel.
Brands need not just be a corporate name or product. A country can be a brand too. “Made in USA” for us in Singapore carries connotations of high technology, innovation and cutting-edge products. “Made in Japan” makes us think of high quality, long lasting, thoughtfully designed products created by perfectionists.
This might be one reason why Apple iPods are more popular locally than Creative Zen mp3 players. In the recent Reader’s Digest Asia SuperBrand Survey quoted in the Straits Times, Singaporeans are the most likely in Asia to favour a foreign brand over a local one.
Though high technology products may be all about features, the product itself may surprisingly be the least important aspect in marketing it. After the first mover advantage – which is the advantage over competitors that a company gets from creating or entering a new market – is lost, most products become similar, with little to differentiate one from the other in terms of salient features or even quality.
Branding with the aid of advertising comes in to create a perceived difference and to make consumers choose based on that difference.
Nokia, for example, has been working on building a strong corporate brand image of “human technology”. According to the book Hi-Tech Hi-Touch Branding by Dr Paul Temporal, a consultant to leading Asian and international companies on branding strategy, Nokia’s “human touch” is seen in all their advertising and marketing communication, and the company has successfully positioned itself as a “human” dimension of mobile communications that understands the users’ needs. Its phones have thus gained consumers’ trust as a guarantee of user-friendliness. That has made Nokia sit at the top of many markets around the world.
Sometimes the ideas associated with a brand are already formed, independently of the company’s intention or any advertising campaign. As a result of its chequered history, Apple is now associated with being “different, unique, unconventional”, and most importantly, “cool”.
With some nifty advertising, even having the lesser product is no hindrance to conquering the market. Given careful thought, the Apple iPod Shuffle is not very promising – there is no LCD display, no radio function and basically it just plays music and not even in the order you want it to!
However with some creative marketing, a seeming handicap was turned into a clever marketing device – the Shuffle is about being “spontaneous, different, fun”.
Product design is also crucial when it comes to the allure of Apple products. Apple is known for its design and innovation, its fusion of technology and the arts, and its focus on ease of use and simplicity. The iPod and iPod Shuffle’s sleek designs and curves, light weight and minimalistic white exterior have been marketed, packaged and sold well.
And of course being Apple, everyone loved it.
Now that’s how captivating technology marketing is.