A version of this essay was originally published at Tech.pinions, a website dedicated to informed opinions, insight and perspective on the tech industry.
There’s a famous story about the Pepsi Challenge campaign back in the 1980s, and Coca-Cola’s related (and misguided) decision to launch New Coke in 1985. The story — as told by Malcolm Gladwell in his book "Blink" — is that the Pepsi Challenge appeared to show people that liked Pepsi better than Coke in blind taste tests, which panicked executives at Coke into rethinking their formula for the drink. Subsequently, it emerged that people actually preferred Coke to Pepsi when drinking a whole glass or can, but preferred the sweeter Pepsi under the specific conditions of the Challenge, which only had them sip each drink.
A number of technology product categories are confronted with the challenge of selling what is ultimately an experience rather than a product.
A few years back, I was meeting with a senior U.S. executive at Nokia, and I mentioned this story in the context of the company’s efforts to sell Windows Phones. Whatever other challenges the Windows Phone had, one of the biggest in the early days was that it looked radically different from every other smartphone operating system out there — instead of a grid of app icons, the Windows Phone featured a mosaic of colorful squares of different sizes, many of which moved around and changed as the user watched them. There was actually a lot of value behind that approach, with the richer information presented on the Live Tiles.
But at first glance, the OS just seemed unfamiliar and strange, and many users rejected it out of hand. In that sense, Windows Phone was like Coke in the Pepsi Challenge — given only a very brief exposure, people preferred the alternative, but given a deeper experience with the product, people might come to like it better. My conclusion was that one of the things Nokia had to do (as by far the largest seller of Windows Phone devices) was find ways to get people to spend some time with a Windows Phone device and really see its merits. (I was somewhat amused later to hear that the same executive had been using this analogy with colleagues since our meeting, though the fortunes of Windows Phone never really improved much.)
I mention this now because this same challenge confronts a number of other technology product categories today, and that’s the difficulty of selling what is ultimately an experience rather than a product. There are at least three categories that come immediately to mind, but there are doubtless others, too. What they have in common is that the value proposition isn’t obvious just by seeing a box on a store's shelf or even having someone explain it to you. You have to experience it to really understand the value proposition, and in some cases, simply experiencing it can be enough to sell you on the idea — whereas nothing else will get you over the finish line. The three categories I have in mind are the smart home, home speaker devices like Amazon’s Echo and virtual reality.
With a tech category like the smart home, home speaker devices like Amazon’s Echo or virtual reality, simply experiencing it can be enough to sell you on the idea — whereas nothing else will get you over the finish line.
As I’ve written here previously, the smart home market suffers from a number of different challenges. One of the biggest is that it’s really hard to convey the value of smart home technology in words alone — you kind of have to see it working in a real home, or at least a decent mockup home, to really understand the potential. Simply seeing a connected lock, doorbell camera or smart thermostat in a box on a shelf at your local Best Buy likely won’t do it, no matter how attractive the packaging. Arguably, the ideal sales setting is your own home, with someone to walk you through the possibilities, showing you where devices could be installed and how they would work in the very setting where you’ll be using them.
From a home speaker perspective, it’s similarly difficult. I finally had to break down and buy an Amazon Echo to try for myself because I had heard and seen so many people talk it up in ways I just didn’t find compelling. It’s hard to imagine what you might use something like that for unless you have it around for a while and spend some time understanding what it can do and the scenarios in which it’s helpful. For example, the idea of setting a timer on Echo wasn’t that compelling to me in theory, because I regularly use my watch and phone to do that. But the first time you have your hands full in the kitchen and need to do it, the value proposition of something like the Echo becomes a little clearer. And there’s no way I would have predicted how much entertainment value my kids would have got out of simply asking Alexa to tell them jokes. At the end of the day, I returned the Echo to the store because I wasn’t convinced it was worthwhile to me, but I never would have understood the value proposition as well as I do now if I hadn’t had one in my home for a few weeks.
Lastly, virtual reality. This is perhaps the only category I can think of where you could probably divide the population very neatly into those who have tried it and are sold on the idea and those who haven’t tried it. Virtual reality just doesn’t sound all that compelling when you explain it to someone. But once you’ve experienced it, there’s a definite "A-ha!" moment. As John Carmack likes to say, virtual reality makes converts on contact. As with the Echo, that doesn’t mean we’re all going to be buyers just because we spend some time with it, but it’s infinitely easier to sell if someone has a proper experience with it.
It’s hard to imagine how you might use something like the Amazon Echo unless you have it around for a while and spend some time understanding what it can do and the scenarios in which it’s helpful.
For each of these three categories, that creates significant challenges in actually selling the products. Giving people real experiences with the smart home, home speakers or virtual reality takes time and, in some cases, a significant amount of space. For retailers accustomed to devoting shelf rather than floor space to consumer electronics, this may well require a change in mindset. It also likely means store associates spending considerably more time with potential customers than they might have done traditionally, because doing a full-on demo takes more time than just directing someone to the right part of the store.
Perhaps the most powerful ways of selling experiences have nothing to do with retail at all and are instead based on word-of-mouth marketing, in which trusted people who have already had those experiences share them with their friends. The key thing here, though, is that marketing some of these experiential products requires some radically different approaches from those traditionally used for consumer electronics.
Jan Dawson is founder and chief analyst at Jackdaw, a technology research and consulting firm focused on the confluence of consumer devices, software, services and connectivity. During his 13 years as a technology analyst, Dawson has covered everything from DSL to LTE, and from policy and regulation to smartphones and tablets. Prior to founding Jackdaw, Dawson worked at Ovum for a number of years, most recently as chief telecoms analyst, responsible for Ovum’s telecoms research agenda globally. Reach him @jandawson.
This article originally appeared on Recode.net.