Chapter 5: Effectiveness Leads to Repeat Purchases

Overview

When they evaluate something new, potential customers are generally interested in how effectively the new product or service does its job. If they are not convinced that it will work, they will not buy it. If it is a new cleaning product, they must be reasonably sure that it will actually clean the surface it is supposed to clean. If it is a new lightbulb that is supposed to last longer, they must be fairly certain that it will last as long as it claims. You might ask people why they believe your new concept will do the job it is intended for and then listen carefully to find out whether they really feel that it will be effective.

In 1999 a new product was launched under the brand name Zicam that claimed that it could actually reduce the duration and severity of the common cold. For many years there has been a saying in the United States that if someone could find a cure for the common cold, he or she could make a lot of money. Well, it looks as if this might be true of Zicam. At the time of this writing, it has achieved distribution in approximately 90 percent of the nation s drugstores and 60 percent of its grocery stores, and it is being sold by all of the major mass merchants , including Target, Wal-Mart, and Kmart. Its sales have been increasing on average 48 percent a year, and that growth rate is continuing.

Clinical studies have shown that Zicam users can get over a common cold in just two days, compared to seven to fourteen days for the average person without it. The management of the company that launched Zicam believes that the basis of its success is this effectiveness of the product. Management believes that because this product really works, people keep buying it over and over again. It feels that many Zicam customers are so convinced that the product works that they not only use it themselves but tell others about it. This word of mouth helps to increase sales even further. Zicam is a perfect example of how effectiveness leads to repeat purchases.