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or because of the product or service on offer； will not be over…interested in
having their higher needs met。 When Charles Rigby set up World Challenge
（world…challenge。uk） to market challenging expeditions to exotic
locations around the world； with the aim of taking young people up to
around 19 out of their fort zones and teaching them how to overe
adversity； he knew he had a challenge of his own on his hands： how to
88 The Thirty…Day MBA
make an activity simultaneously exciting and apparently dangerous to
teenagers； while being safe enough for the parents writing the cheques to
feel fortable。 Six full sections on its website are devoted to explaining
the safety measures that the pany takes to ensure that unacceptable
risks are eliminated as far as is humanly possible。
Physiological needs
Air； water； sleep and food are all absolutely essential to sustain life。 Until
these basic needs are satisfied； higher needs such as self…esteem will not be
considered。
You can read more about Maslow’s needs hierarchy and how to take it
into account in understanding customers on the Net MBA website （
netmba 》 Management 》 Maslow’s Hierarchy of Needs）。
Features； benefits and proofs
While understanding customer needs is vital； it is not sufficient on its own
to help put together a saleable proposition。 Before you can do that； you
have to understand the benefits that customers will get when they purchase。
Features are what a product or service has or is； and benefits are
what the product does for the customer。 When Nigel Apperley founded his
business Internet Cameras Direct； now Internet Direct （internetdirect。
co。uk） and part of the AIM…listed eXpansy plc； while a student at business
school； he knew there was no point in telling customers about SLRs or
shu。。er speeds。 These are not the end product that customers want； they are
looking for the convenience and economy of buying direct； so he planned
to follow the Dell puter direct sales model and show good pictures。
Within three years Apperley had annual turnover in excess of ￡20m and
had moved a long way from his home…based beginnings。
Look at the example of product features and benefits （Table 3。1）； which
has been extended to include proofs showing how the benefits will be
Table 3。1 Example showing product features； benefits and proofs
Features Benefits Proofs
Our maternity clothes are
designed by fashion experts
You get to look
and feel great
See the press ments in fashion
magazines
Our bookkeeping system is
approved by HM Revenue
and Customs
You can sleep
at night
Our system is rated No1 by
the Evaluation centre （
evaluationcenter》accounting
so。。ware）
Marketing 89
delivered。 The essential element to remember here is that the customer only
wants to pay for benefits while the seller has to pick up the tab for all the
features whether the customers sees them as valuable or not。 Benefits will
provide the ‘copy’ for a business’s advertising and promotional activities。
Product/service adoption cycle – who will
buy first？
Customers do not sit and wait for a new business to open its doors。 Word
spreads slowly as the message is diffused throughout the various customer
groups。 Even then it is noticeable that generally it is the more adventurous
types who first buy from a new business。 Only a。。er these people have given
their seal of approval do the ‘followers’ e along。 Research shows that
this adoption process； as it is known； moves through five distinct customer
characteristics； from innovators to laggards； with the overall population
being different for each group。 （See Table 3。2。）
Table 3。2 The product/service adoption cycle
Innovators 2。5％ of the overall market
Early adopters 13。5％ of the overall market
Early majority 34。0％ of the overall market
Late majority 34。0％ of the overall market
Laggards 16。0％ of the overall market
Total market 100％
Let’s suppose you have identified the market for your internet gi。。 service。
Initially your market has been constrained to affluent professionals within
5 miles of your home to keep delivery costs low。 So if market research
shows that there are 100；000 people that meet the profile of your ideal
customer and they have regular access to the internet； the market open for
exploitation at the outset may be as low as 2；500； which is the 2。5 per cent
of innovators。
This adoption process； from the 2。5 per cent of innovators who make
up a new business’s first customers through to the laggards who won’t
buy from anyone until they have been in business for 20 years； is most
noticeable with truly innovative and relatively costly goods and services；
but the general trend is true for all businesses。 Until you have sold to the
innovators； significant sales cannot be achieved。 So； an important first task
is to identify these customers。 The moral is： the more you know about your
potential customers at the outset； the be。。er your chances of success。
90 The Thirty…Day MBA
One further issue to keep in mind when shaping your marketing strategy
is that innovators； early adopters and all the other sub…segments don’t
necessarily use the same media； websites； magazines and newspapers or
respond to the same images and messages。 So they need to be marketed to
in very different ways。
SEGMENTING MARKETS
Having established that customers have different needs means that we
need to organize our marketing effort so as to address those individually。
However； trying to satisfy everyone may mean that we end up satisfying
no one fully。 The marketing process that helps us deal with this seemingly
impossible task is market segmentation。 This is the name given to
the process whereby customers and potential customers are organized
into clusters or groups of ‘similar’ types。 For example； a carpet/upholstery
cleaning business has private individuals and business clients running
restaurants and guesthouses； for example。
These two segments are fundamentally different； with one segment
being more focused on cost and the other more concerned that the work is
carried out with the least disruption to their business。 Also； each of these
customer groups is motivated to buy for different reasons and your selling
message has to be modified accordingly。
Worthwhile criteria
These are four useful rules to help decide if a market segment is worth
trying to sell into：
。 Measurability： Can you estimate how many customers are in the
segment？ Are there enough to make it worth offering something
‘different’？
。 Accessibility： Can you municate with these customers； preferably
in a way that reaches them on an individual basis？ For example； you
could reach the over…50s by advertising in a specialist ‘older people’s’
magazine； with reasonable confidence that young people will not read
it。 So if you were trying to promote Scrabble with tiles 50 per cent larger；
you might prefer that young people did not hear about it。 If they did； it
might give the product an old…fashioned image。
。 Open to profitable development： The customers must have money to
spend on the benefits t