Why did companies like Woolworths, Zavvi and The Pier fail during the recession? There isn’t one simple answer to the question, but something that all three arguably shared was a lack of marketing-led innovation. Woolworths was predicated an out of date model; it appeared tired and shambolic to customers, despite carrying a wide range and a perception of being good value. The Pier did little to change its offering for too long; it had an excellent quality product, but it didn’t innovate. And Zavvi suffered because it needed to innovate against the onslaught of downloads and online competitors, who could offer lower prices and increased stock because they didn’t need expensive high street stores.
In all three cases, some market-led innovation would have helped their troubles. Consider Bupa, which has reinvented a boring product (insurance) and made it into a desirable one (exclusive healthcare). Or Staples, which differentiates stationery products by making them tactile and attractively designed. The three companies that failed when the recession bit could have taken such lessons on board and found ways that would have helped them retain customers and place foundations for future growth. For Zavvi for instance, there could have been a recognition that trying to compete on choice or price was not going to succeed against internet rivals. Instead, a focus on service, staff knowledge and an emphasis on discovering and promoting local talent might have been a more effective way forward.
The details of the marketing-led innovation are less important than recognising the need to have a marketing-led strategy to begin with.
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