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Better Off Dead?

Eight ways to spot a product line that's doomed.

The owner of a small electronics manufacturing company was searching for a way to kick-start sales, which had flattened over the past three years. After a lengthy session of hand-wringing and self-doubt, he came up with what he felt was the best way for the company to get moving again. He would make sure his staff did everything it could to improve customer service and concentrate more on customer satisfaction. The company would have to work harder at satisfying its customers because that was the only thing holding them back--or so he thought.

Customer satisfaction plummets when companies get into production problems that delay delivery or affect quality, but this company didn't have those problems. It had a good record for meeting customer delivery needs, had an excellent reputation for product quality, and the staff seemed knowledgeable about how to deal with customers. It was a good bet the problems were coming from another area. But where?

The business owner stumbled across a clue during a conversation with his sales manager. As the sales manager held one of the company's primary products in his hand, he sighed and compared it to a typewriter. It was a great product in its time and had made a major contribution to the company's earlier growth, but the market was going in another direction. This major product was already obsolete, and more parts of the product line were quickly getting there, too. Sales weren't growing because customers were looking elsewhere--toward more up-to-date technology. All the customer follow-up and responsiveness in the world wouldn't stop that trend. The company's problem was its product line. Unless it was willing to make a major investment in new products that could restore the growth everyone wanted, it was doomed.

Victor H. Prushan is president of VHP Associates, a marketing consulting firm in Thousand Oaks, California, and author of No-Nonsense Marketing: 101 Practical Ways to Win and Keep Customers (John Wiley & Sons).

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This article was originally published in the April 1998 print edition of Entrepreneur with the headline: Better Off Dead?.

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