With more and more brands competing for customers hearts and minds, I am seeing a new trend appearing in some of the sectors in which I am working - Vanity Investment. What is Vanity Investment? Simply put, it is when an organisation casts aside the commercial business model and develops products and services that are focussed on being first, and not necessarily focussed on making profit. In this article, I will explore the argument for Vanity Investment, and the argument against it.
In Middle Eastern markets, winning customers hearts and minds is all about being first. We have an insatiable desire to have the latest and greatest of everything. I believe this is, in part, the reason why we are seeing such incredible growth in the region. So many of us who live here have drawers full of the latest technology which we have tried for a while and eventually discarded... yet our appetite remains.
In these markets, being first, being seen to be first (from a business perspective), being innovative and offering the latest and greatest technologies, experiences and services is what customers want... and therefore, one would assume that this is good for business too. However, I am not so sure. I have noted that businesses who succeed are those who balance Vanity Investment with real hard and fast business. Whilst being first is important, leadership has to be balanced alongside commercial reality.
I have seen many businesses in the region become consumed by being first. The kind of buy now, pay tomorrow thinking that is responsible for the boom or bust economic cycles we experience - only to fall foal of mounting debts and a lack of consumer demand - once the novelty value of their new product has worn off.
So, what is my advice to any business that is striving to win the hearts and minds of the Middle Eastern customer:
Be first but balance being first with a solid commercial model
Be strategic in any innovation
Remember throwing money at innovation will not always work. A rubbish idea will always be rubbish no matter how much money you spend trying to convince people otherwise
Before reinventing the paradigm ask yourself if you have the mechanisms to deliver to all your customers - not everyone is Apple, and an innovative product can do as much damage as it can good if it is not delivered well
Check cultural fit. Be sure your innovation is culturally appropriate and you are not convincing yourself that you have the next, greatest thing because you like it. Everyone has to like it... or a the very least, more than a few need to like it
Avoid fashions and fads - innovate with an eye on the medium and longer term
Build in flexibility - wherever possible, be adaptive, offer products and services that can evolve as you learn more about you customers behaviours
Try to be exclusive - at least for six months. Being first means you will be copied if your innovation works. Try to ensure you have an exclusive arrangement with your supplier so that you can protect your market position before competitors move in
Use technology, but accept you cannot keep pace with every innovation
Be focussed - avoid innovating because you feel you need to
Link innovation to other products and services in your portfolio - funnel customers to a sale
Remember there always has to be something in it for you - never do anything for nothing. Information is power in the modern world. If you are innovating and delivering innovation to your customers for free, be sure to get something from them in return... even if it is only an email address.
If you have considered all of these points and more, and something totally new makes sense - go for it. You will have at least one new customer in me. I love innovation and experimentation.