What Is Market Orientation?
Let me explain market orientation to you—it's a business strategy where you focus on understanding what your consumers need and want, then use that to guide how you develop products and boost customer satisfaction.
You might think this is straightforward, but supporters of market orientation point out that the usual way companies develop products is actually the reverse: they create marketing strategies to highlight selling points for products they already have, instead of building products based on what consumers explicitly say they desire.
Key Takeaways
- Market orientation is a strategic focus on identifying consumer needs and desires in order to define new products to be developed.
- Established businesses like Amazon and Coca-Cola use market orientation principles to improve or expand their products or services.
- Even consumer demands that are impractical today can inform long-range decision-making.
How Market Orientation Works
Market orientation puts the customer at the center of your product design process. You conduct market research to figure out what consumers see as their immediate needs, main concerns, or preferences in a specific product category. Researchers use surveys on activities, interests, and opinions (AIO) along with demographics to get insights into what your target customers really want.
You can also analyze additional data to spot trends and unspoken consumer desires. Knowing these trends helps product developers meet or even get ahead of what consumers need, and it might lead to improvements consumers didn't even know were possible.
This way, you direct your product development toward the features that are most demanded. In today's global economy with endless choices for consumers, if you adopt market orientation, you could gain a competitive edge over rivals.
Advantages of Market Orientation
When you implement market orientation, it often means upgrading customer service and product support to address consumer concerns directly. This keeps overall customer satisfaction high, builds brand loyalty, and encourages positive word-of-mouth.
For success, you need all departments in your company to embrace this approach and make it part of your corporate culture. Done right, it can boost customer retention and help you grow into new demographics.
Sometimes, market orientation uncovers customer desires that aren't practical or cost-effective to implement right now. In those cases, you have to decide the best way to meet expectations. At minimum, even impractical ideas can shape your long-term strategies, as future changes in technology, science, regulations, or market conditions might make them feasible.
Market Orientation vs. Other Strategies
With market orientation, you prioritize consumers' desires and build products around their stated needs and wants. This is different from product orientation, where the emphasis is on making consumers aware of and interested in the features of an existing product.
Product differentiation usually pairs with product orientation—you use advertising to highlight what sets your brand apart from competitors.
Sales orientation is about pushing consumers to act immediately, through tactics like online ads, social media, TV commercials, in-store demos, or direct response marketing.
You might need any or all of these for a solid marketing strategy, but most businesses pick one or a few as their main focus.
Real World Examples of Market Orientation
Take Amazon as an example of a market-oriented company. As it has expanded, it keeps adding features that directly tackle consumer concerns. For instance, many people, especially in cities, worry about package delivery when they're away from home—Amazon responded with Locker, a system of self-service pickup boxes. Delivery fees annoy consumers and push them to shop locally instead of online, so Amazon Prime offers free delivery on most items for an annual fee.
Coca-Cola
Coca-Cola is another prime example of market orientation. They invest heavily in research to find new flavors consumers will like, such as wild strawberry or lime. But to address growing health consciousness, they didn't just stick to sodas—they bought brands like Dasani, Honest Tea, Smartwater, Simply Orange, Minute Maid, and Vitaminwater.
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