Once upon a time in the rural heartlands of India … the FMCG gods, P&G and Unilever, simply did not want to stock hair shampoo on the shelves of retailers. And why would they? Rural users couldn’t afford a luxury like shampoo – at around $4 a bottle it simply wouldn’t move off of the retailers’ shelves. Rural folks kept it simple – the purpose was to keep hair clean, so they just used body soap for their hair. The FMCG mass producers didn’t want to educate people on the benefits of a product the latter couldn’t afford, nor change their model of mass distribution.
Enter a small company called Chik, who knew it was not as though rural buyers were lacking aspiration – they simply couldn’t afford $4. So Chik introduced single-use sachets – 5ml packets of shampoo that smelled really nice, had pictures of popular movie stars on the packet, and were very affordable at roughly 7 cents a sachet. Retailers still didn’t want to stock the low margin product – so Chik sold them at informal, weekend markets called haats.
Users could buy the single-serve sachets for whenever they wanted or needed them. Long story short, the product simply skyrocketed! P&G and Unilever were stunned and launched their own competing products and played catch up for several years.
This is the truest example of what marketing is at its heart – unlocking value by tweaking the marketing mix – product, price, promotion, and placement – to target an unexplored segment.
The business enterprise has two – and only two – basic functions: marketing and innovation – Peter Drucker
But, hey, that’s what they teach you at business school – marketing is just tweaking your STP (segmenting, targeting, positioning) and the 4Ps and monetizing the resulting value. What they didn’t teach for many decades at business schools is that true value – and innovation – is unlocked by empathizing with your customers’ perspectives – working with them to understand what they truly care about.
That’s what Stanford University’s Design Thinking is about.
Chik shampoo is not necessarily an example of design thinking because the marketers did not necessarily consult their customers on what they wanted. Design thinking is when you go through the process of empathizing with your customers’ perspective and then brainstorm on how best you can solve their problems. Rapid iteration (a concept design thinking imbibed from what is called Agile Development in Software) is another key feature of design thinking – a minimum viable product or service is designed – and if it needs improvement, customer feedback helps rapidly improve the offering. The following graphic illustration is taken from the Rackspace blog:
(image source: https://blog.rackspace.com/design-thinking-transforming-businesses-through-technology)
How can digital marketers use Design Thinking?
Watch this great video from IBM on how an online gardening shop can unlock value by empathizing with their customers – and creating a great digital strategy. The first part of the video is an introduction to design thinking and agile management – sit through it – and get to the part about the online gardening store. The wait will be fully worth your while!
Click this link to watch the video: IBM Design Thinking Video
(For some reason the video won’t play on WordPress)
Using a design thinking mindset as the starting point of your digital strategy
It is not hard to imagine how the entire digital strategy of the online gardening store would revolve around empathizing with its customers – posting useful hints and tips on home gardening, creating groups on Facebook, and providing bite-sized insights on Twitter, Instagram, Snapchat, or Facebook messenger.
This is just one example. As you start searching, you will find dozens of case studies of how having a design thinking mindset can help you unlock and monetize value – the holy grail of marketers. The topic is exhaustive – so this article is only meant to get you started.
A LinkedIn user, Scott Brown, left a very concise comment on one of my earlier articles, and it serves as a nice summary:
It’s a case of mapping human behaviour and preference with the conduits and tools available to reach your target audience – how and where and when they will be receptive. Design Thinking and empathy – being able to develop and hold your customers’ perspective rather than merely your own. In one fundamental way, on line marketing is the same as direct marketing in that both require true empathy to understand and cater for your customers’ preferences. The difference is the conduits between you and your customers are very different – and even this infrastructure is subject to your customers’ preferences.
(Personal observation: Design thinking is a highly intuitive, imaginative, and idea-driven field – so I am not a huge fan of the academic community’s efforts to try and convert it into a hard discipline like Operations or Strategy. It is a very soft discipline at best – left to the creative, fun people on your team!)