Are you selling Tylenol or vitamins?
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A Tylenol product looks something like this:
Customer: “I have a headache. I need something that will remove this headache.”
Marketer: “Take this pill and your headache will go away.”
Customer: “Great. I will buy your product. It is exactly what I am looking for.”
A Vitamin product looks a little different:
Customer: “I feel fine.”
Marketer: “You might feel fine today, you might get sick in the future. If you take my vitamins today, you can reduce the chance of future illness.”
Customer: “Oh…well…I feel fine.”
Marketer: [Lots of convincing through many channels over a long period of time].
Customer: “I take my Vitamin every morning so I won’t get sick in the future!”
Tylenol products solve a specific problem that a customer is experiencing. Vitamin products, on the other hand, try to improve a customer’s life by solving a problem that the customer didn’t even know existed. It is MUCH easier to sell a new Tylenol product than a new Vitamin one. But — once you persuade a customer to use a Vitamin product, they can usually be swayed into continued usage (since the products offers a benefit all the time, not just when the customer has a specific problem to solve).
If you are a Tylenol product, you need to convince consumers to use YOU instead of alternative solutions when they have a problem. If you are a Vitamin product, you need to convince consumers to spend their time and/or money on your category instead of somewhere else (and then once you’ve done that, to choose you). Tylenol products usually have a tight definition of who their competitors are, while Vitamin products may not have traditional competitors at all — in fact, you could say they compete against just about everything.
The best advertising method for a Tylenol product is to ‘jump in front’ of customers just as they reveal they have ‘the problem.’ What is the most effective strategy for jumping in front? Search marketing. Later in the book, I will discuss search strategies in significant detail. For now, let’s focus on the basic concept of how search engines work: Google’s results are shaped by whatever words a person enters.
What do people usually search for? Research about Google keywords reveals a clear pattern — people have a problem and are looking for a solution. If you sell a Tylenol product, there is no better place to hold than the top of the search results for a consumer with a problem that your product can solve.
For example, if someone searches for “Hotels in San Antonio,” it turns out that a lot of the time that consumer is looking for a solution to the problem: “I need a hotel in San Antonio.” Likewise, if someone searches for “stores that sell video games,” guess what? That person probably needs help finding stores that sell video games.
Whether your Tylenol product can appear on the top of those search results is a different question (one that I cover later in the book). Needless to say, if you manage to appear first — for free — it would definitely be very good for your business.
While climbing to the top of the search results would capture attention for a Tylenol product, it wouldn’t necessarily be true for a Vitamin one. By their very nature, Vitamin products can be challenging to identify, so let’s focus on a concrete example of a very successful one: Facebook. You couldargue that Facebook solves a problem (like “How do I connect with that girl I met last night at the frat party, but was too chicken to ask for her phone number?”). Really, though, Facebook pioneered (alongside platforms like Friendster and MySpace) a new type of product and claimed: “Joining Facebook will improve your life for all sorts of reasons, and, besides, all your friends are doing it.” No one was searching Google for “social networks” or “how do I reach Dave when I don’t have his phone number?” Facebook had to create an entirely different method of reaching people.
For most of the last half-century, advertisers held a common opinion about the preeminent way to reach consumers: the television. Advertising on TV offers benefits for both Tylenol and Vitamin products. Before search engines, Tylenol products needed TV exposure so that people would know about the product before they had the problem— so they would reach out for it when they did. Vitamin ones require a mass medium like TV to spread the word about why people should even consider the product.
Because both types of products shared the same marketing mediums, the industry has not traditionally differentiated between the two. But in today’s digital world, there is a significant distinction, and you should focus your marketing very differently depending on the product you offer.
By now it should be clear how important search is for your Tylenol product. You really, really, really want to reach people who face the specific problem you want to solve. When Tylenol products max out an advertising channel, they naturally start looking for new strategies. For many people, there’s an obvious next step — start advertising on Facebook. But here’s the problem with advertising on Facebook: no matter what demographic you target, most of the time the person you are advertising to doesn’t have a headache, so they don’t want or need your Tylenol. You are just an unpleasant interruption for what they were doing before you jumped into the conversation.
Many Tylenol products that advertise on Facebook can’t understand why they are getting such poor ROI. “What are we doing wrong?,” they ask. Answer: you have the wrong product for that channel. Stop wasting your time.
In contrast, Vitamin products — which we already showed perform terribly on Google (because no one is searching for them) — can achieve great results on Facebook. Companies that have done well on Facebook include Betabrands (eccentric clothing, based partly on consumer-suggested ideas) and Tough Mudder (endurance events that feature daunting obstacles). No one was searching for “hoodies I can wear to the office” or “races where I get zapped by electrical current.” People didn’t know they wanted these products until they were shown the idea — then they jumped on board and were okay with the interruption to their social media feed.
Some Vitamin products have generated impressive success by leveraging a specific element of platforms like Facebook: “Clubs,” which I would describe as the various types of groups, lists, or subscriptions that provides ongoing information about products to the people who sign up or register. One clear example of a Club: Groupon. They do not advertise: “We can help you find a restaurant tonight.” Instead Groupon says: “Sign up for our Club and we’ll send you a daily message with information about fun products, services, and activities. Plus, we’ll give you a discount.”
No one was searching Google for “Daily Discount Emails” (at least not until after Groupon created the category), but there was a demographic of people who were very interested in the idea. As such, Groupon achieved considerable success in targeting those demographics and signing them up for their Club.
To be clear, I’m not suggesting that you should never advertise your Vitamin on Google or your Tylenol on Facebook, just that those should not be your key channels. If/when you do look at the ‘other channel,’ you should remain very skeptical about your possible results. As a strategy to increase the likelihood of success, think about how you can transform your Tylenol product into a Vitamin one and vice versa.
For instance, if you operate a hotel booking engine, maybe you create a travel club product. While any individual on Facebook likely doesn’t need a hotel RIGHT NOW, there is a segment that travels frequently and might want to join a club that gets them discounts or benefits on future travel.
Conversely, if you run a daily deals site, maybe you can capitalize on the timing of offers for products that solve specific problems — then you run a Google ad targeting that problem, during the window of time that the deal available. Example: “Looking for a hair cut in Austin? Click for 50% off an Austin hair cut right now.”
The key ideas
Figure out if you are selling Tylenol or Vitamins
Focus your initial marketing efforts in the right place
Create a side-product of the opposite type, so you can grow your channel base
Since we all love charts, here is how I compare the two types of problems:
Hopefully you can see that the Tylenol/Vitamin concept is not difficult. But if you haven’t thought through the concept, it would be very easy to spend marketing dollars advertising in the wrong channel and not understand why it wasn’t working. When I was at Expedia, the president was constantly asking why we couldn’t get Facebook advertising to work. I wish I had this vocabulary back then. I believe this easy concept can provide greater impact than advanced strategies involving complicated customer segmentation.
[Hat Tip to Philip Vaughn who shared the Tylenol/Vitamin construct with me].
Keep it simple,
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Edward Nevraumont is a Senior Advisor with Warburg Pincus. The former CMO of General Assembly and A Place for Mom, Edward previously worked at Expedia and McKinsey & Company. For more information, including details about his latest book, check out Marketing BS.