What Is Product Orientation? Activities, Examples & Companies

Product orientation is a business approach that emphasises the development and design of high-quality, demand-generating products. In other words, a product-oriented business has an attitude of “if you develop it good, they will come”

Market orientation is the strategy on the opposing side of the coin. Product-oriented companies create things that they believe are powerful enough to generate public interest, whereas market-oriented companies create products meant to respond to existing public interests. Examine definitions and examples of firms that employ product orientation to learn more about product orientation.

Product-Focused Actions

Prior to the middle of the 20th century, product orientation was pretty normal because consumers had limited options for some things. This concept is exemplified by a statement made by Henry Ford in the early 1900s: “Any client can have a car painted any colour he likes, as long as it is black.”

However, as the marketplace continued to evolve, company tactics were compelled to adapt to changing consumer needs. As absence of rivalry has grown increasingly uncommon in most industries, many successful organisations now combine market- and product-oriented strategies. While it is still typical for some businesses to lean more heavily towards one side or the other, few opt to use only one or the other.

Regardless, product focus remains an integral component of the marketing strategy of the majority of businesses. During the product orientation phase of product development, there is a significant emphasis on product research, product development, and product orientation.

Product Development

If you’re planning to create a business or release a new product, product research is crucial in determining your likelihood of success. New research can involve a range of tasks, including as assessing and testing product concepts, determining how much competition you’ll have, determining prospective production costs, and pricing the product so that you can produce a profit.

Product Improvement

If a business has a strong emphasis on product orientation, then this is a significant portion of the process. Although numerous actions are involved at this stage, the focus is on developing the most robust procedure feasible to ensure demand. Typically, development entails producing and designing a new product or determining how to improve an existing one. It may also involve building and testing the product, as well as its production, marketing, and distribution.

Product Focus

Product concentration encompasses planning aspects such as sales strategy, manufacturing, and metrics. By focusing on the product, businesses strive to continuously enhance their offers in order to remain competitive in their field.

Product Orientation Examples

Despite the fact that we stated that many businesses utilise a combination of market orientation and product orientation, there are others that lean more towards product orientation. These companies are typically innovators that introduce things that people did not know they desired. Some instances include:

Apple

Before Steve Jobs and the Apple crew became the tech superstars they are today, no one could have imagined the iPod, iPhone, iPad, or iAnything. Yet, by creating these and other groundbreaking new products, Jobs and his team were able to profit by supplying items for which they accurately forecasted a high demand.

Netflix

Technically, Netflix’s product is more of a service, but by offering users with instant access to the newest movies and television episodes, Netflix rendered Blockbuster obsolete. Once again, the company’s success was predicated on recognising a convenient option that the general public was unaware was even possible.

Robinhood

Robinhood is an investment app that revolutionised market trading. Prior to less than a decade ago, the stock market was unavailable to the average investor due to the high cost of brokerage commissions. Then, Robinhood created a commission-free trading platform that individual investors could utilise to participate.

Other brokerages, such as TD Ameritrade and Etrade, were ultimately compelled to go commission-free in order to keep up with the demand. Robinhood’s product-oriented strategy was the consequence of recognising a problem in a specific industry and then resolving it in a way that no other firm had explored or attempted.

Positives and Negatives of Product Orientation

Companies with a product orientation tend to follow a distinct set of operating guidelines than those with a market orientation. Marketing- and product-focused company models have their own advantages and disadvantages.

Innovation

As previously said, product-oriented enterprises frequently produce innovative new items or services that fulfil a market demand. In their early stages, the capacity to be the first to offer a product or service frequently entails being the only company to do so. This was the situation with Netflix in the early 2000s, when it added digital streaming to its existing DVD-by-mail business.

The disadvantage of innovation is that when something is successful, more businesses offer it. Hulu was already a competitor to Netflix’s streaming service by 2008. The idea is that innovation can only carry you so far.

Consumer Response

Product-oriented businesses should not be as concerned with the adage “the customer is always right” as market-oriented businesses do. This allows them to view public opinion with scepticism and relieves them of the obligation to keep up with continuously shifting fashion trends.

The disadvantage is that trends do sell. Typically, market-driven organisations are able to earn a considerable deal of money by simply providing clients with what they want. Instead than guessing if a new product or service will fill a market void, they listen to public feedback and produce products that are already in demand in order to match that demand.

Quality

For product-focused firms, quality is typically the most important factor. Because they rely on a product to sell themselves in part, these businesses are well aware that it must be of high quality. This technique has the advantage of saving money on advertising, but it does not always consider other considerations.

Although Apple will always have a significant client base due to the superior quality of its iPhones, not all users enjoy the devices’ infamously high prices and frequent upgrades. This has provided sufficient opportunity for rivals such as Samsung to develop identical handsets at lower prices and with capabilities the iPhone lacks.

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