Businesses that favor the product orientation philosophy assume that product quality is a determinant of demand in the market. In other words, they believe customers will purchase a product based on superior quality, performance, or features – regardless of whether the product suits their individual preferences. Therefore, Product orientation is a marketing management philosophy where the promotion of high-quality products is used to generate sales.
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Understanding product orientation
Product orientation is design-focused and commonly associated with research and development, so it is perhaps no surprise that many product-oriented companies are tech companies. They can innovate with new technologies to address customer needs and generate market demand. Sometimes, the customer needs are unknown or yet to be identified.
Product orientation is sometimes called the “no fear strategy” because there is the implication that the business is bold, proactive, and comfortable with risk. By prioritizing what it is good at, the business also assumes customers will adapt to whatever product it releases on the market.
Examples of product-oriented companies
Some examples of mostly product-oriented companies include:
- Apple – a company famous for envisioning products before consumers knew they needed them. Apple relies on quality and innovation to enter new markets and create demand with products such as the iPod, iPhone, and iPad.
- Netflix – though technically a service, Netflix made companies such as Blockbuster obsolete by giving consumers easy access to movies and television shows. The company capitalized on faster data speeds and recommendation algorithms to provide something consumers would not have thought possible.
- Robinhood – the Robinhood investing app revolutionized trading for the average investor by making the market more accessible. The company developed an innovative product by removing the once prohibitive brokerage fees for retail investors and enabling them to trade in smaller increments.
Advantages and disadvantages of the product orientation approach
Advantages
- Higher product quality – businesses that use the product orientation approach devote less time and energy to marketing and sales and more to product development. Product teams with a quality-first mindset are also free to work without restrictive deadlines that cause development to be rushed.
- Continuous innovation – by its very nature, continuous innovation enables a business to become the first mover in a new industry and importantly, maintain that advantage. What’s more, businesses that demonstrate the ability to innovate regularly tend to enjoy a brand following that is hard to replicate.
Disadvantages
- Competition – while Apple will always have the premium end of the consumer electronics market cornered, there do exist individuals who balk at the price tag of Apple products. This has allowed competitors like Samsung and Sony to leverage Apple’s innovation and introduce cheaper alternatives.
- Product failure – the product orientation approach can be successful, but it is by no means infallible. With less credence given to consumer feedback, there is a risk the new product fails when released to the market. Ultimately, trends do sell and some businesses make money by simply giving consumers what they asked for.
Key takeaways:
- Product orientation is a marketing management philosophy where the promotion of high-quality products is used to generate sales. Product orientation is designed-focused and commonly associated with tech companies that innovate with new technologies to address customer needs and generate market demand.
- Product orientation is otherwise known as the “no fear strategy” because there is an implication that the business is bold, proactive, and comfortable with risk. Some of the businesses embodying these traits include Netflix, Apple, and Robinhood.
- Product orientation results in higher product quality and continuous innovation, which can build a loyal and devoted brand following. However, innovation can be leveraged by competitors and there is also a risk that the innovative product is not what consumers wanted.
Connected Product Development Frameworks
Read the remaining product development frameworks here.
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