– The success of a company depends on three key factors: creation, distribution, and utility.
– Creation involves developing a product or service that provides clear and obvious benefits to customers.
– Distribution involves effectively promoting the product or service to drive awareness and interest, which can be time-consuming and costly.Focus on creating a high-quality product or service that provides clear and obvious benefits to customers, as this is the foundation for success in marketing and distribution efforts.The best ad, landing page, product page, email flow, marketing strategy doesn’t matter if your product is shitty or has bad unit economics. Full stop. There are three parts to any company: 1. Creation, 2. Distribution, 3. Utility.
You create a product or service for a group of people to utilize in their lives that provides them with a benefit that they are willing to find value in. The benefit must be clear and obvious and should warrant the price being offered. Although there are no fixed price scales for any product, your services and price will face a diminishing size of the market the more expensive they get or the more specialized the utility.
Once or before a product or service is created, you have to have a means of getting the word out there about the product or service to drive awareness and interest. This comes at an expense of one of two things: time or money. You can spend your time talking to people or creating content to entertain or highlight the goods or services, or you can spend money to do the same. When you combine the time of creating content with the money needed to be spent, you quickly realize that this is the most time and cost-consuming part of the three prongs. This is what everyone is trying to solve for and what celebrities have been making a killing on in the last few years. Look no further than the Rock and his collection of companies these days.
So you’ve created something and you’ve figured out how to get people interested in it enough to buy it at least once. If the utility is pretty straightforward, you should be able to do alright. But if the utility doesn’t live up to the price point paid for the good, you open yourself up to other competitors that can likely come after your market share. Competition is good in all markets because a certain level of marketing and branding can overcome bad products. However, this becomes increasingly hard the more down market you go and usually leads to stagnation.
Observation about the above and how it relates to DTC:
This is actually the DTC model, hot to trot on the utility side in the beginning, then unit economics catch up and the brands don’t get strong enough quick enough before a larger company can release a competing product with a much stronger brand. Margins are cut out from underneath them and they spend too much money on branding trying to compete against deeper pockets with more products to offset their challenges to the DTC brand. Most DTC brands don’t realize that they are fighting against a country rather than just a single army. #ecommerce #marketing #strategyhttps://www.linkedin.com/in/jivanco