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“People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!”
Posted by: marvinamm | September 26, 2011 | Leave a Comment
Probably one of the most famous quotes in marketing comes from Harvard Business School Professor Theodore Levitt: “People don’t want to buy a quarter-inch drill. They want a quarter-inch hole!”
What Professor Levitt wanted to describe with this statement is just as true today as it was when he first said it. In fact it could be argued that it is indeed more true today than ever before. People want “bundles of benefits”. Your marketing mix should not be centred around your product, nor your company not even your customers. It should be centred around your customers’ needs and wants. Every product no matter what it is, basically provides a service or a solution to a problem a customer is facing. Theodore Levitt described it by using the example of a drill. A drill is sad to only be used on average about 15 minutes during its entire lifetime. So if one can provide the service (the hole) without actual ownership of the tool that facilitates the service (the drill) then one finds himself/herself in a rather unusal sitation. Namely a win-win-win. The customer profits from not having to buy the expensive product but only pay for its service, the company profits because as the marketing concept implies a satisfied customer is one that is likely to come back and the society as a whole profits as from less drills (to stay with the example) in circulation which reduces the impact on the environment.
So why has this not taken off big time?! Well, the answer is, it has! Zipcar and other carsharing companies are doing exactly what has just been described. They are providing the service (customisable, comfortable, flexible transportation) without the need for ownership of the tool (the car) that facilitates this service. And why is the statement mentioned in the first paragrahp today more true than ever?! Because nowadays due to the advancement in information technology (most prominentely the internet and smartphones) one can realise these projects on a much larger scale. Without the internet carsharing as we know it would not have been possible.
I would love to delve much deeper into this topic and I might just do that in a later post (even though I already have some other plans, too) but I am afraid I am already quite a bit over the maximum word count so I guess I’ll best just shut up and let it be.
Stay tuned!