The Greek playwright Sophocles once said, “There lives a man who arranges the things of today as pleasantly as possible but creeps blindly towards tomorrow.”

Facing possible bankruptcy, the U.S. Postal Service seems to have crept blindly toward today. People and businesses just don’t use direct mail to communicate with one another as much as they used to.

Yet the Postal Service, through its 600,000 employees and fleet of 220,000 vehicles, continues to center its business on the same product that it’s been selling since 1775, when Ben Franklin was postmaster general.

The communication landscape has changed dramatically since 1775, and today we have cellphones, email and other communication options. Despite these dramatic changes, the Postal Service has continued to center its business on the singular product of direct mail, and is on track to lose more than $9 billion in 2011.

There’s a simple yet powerful lesson here for any business owner, sales professional or marketer:

Focus on the problem you’re solving, not just on the product you’re selling.

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This isn’t the first time our nation has watched an industrial empire fall because it was too “product-centric.” Think back to the railroad industry during the first half of the 20th century, when we had the Bridgton & Harrison Railway Co., the Portland and Rumford Falls Railroad, and the Cape Cod Railroad.

Travel by train was popular. Railroad companies built themselves up around the product they sold (train travel) and less around the problem they solved (transportation).

When we look at the Postal Service’s failure in the light of the railroad industry, in the words of Yogi Berra, “It’s like deja vu all over again.”

Before the Maine Turnpike and the Interstate Highway System, before United, Southwest and JetBlue, people traveled long distances primarily by train. But as “superhighways” and commercial airlines offered faster and more efficient transportation options, people and businesses solved their transportation needs a lot more with cars, trucks and airplanes than with trains.

Between 1945 and 1964, noncommuter rail passenger travel declined 84 percent. People still needed transportation; they just didn’t need trains as much. But the railroads continued to sell train travel, even though their customers were no longer buying it.

In 1960, Harvard Business professor Theodore Leavitt published a paper titled “Marketing Myopia.” In the article, Leavitt said that large railroad companies failed because they didn’t understand the business they were really in.

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According to Leavitt, the large railroad companies thought that they were in the train business when, in fact, they were in the transportation business. This failure to focus on the larger need of their customers — transportation — ultimately caused these companies to fail.

The Postal Service has essentially been guided by the same myopic strategy, though also affected by restrictive legislation that has prevented it from enacting more savvy business decisions.

So, how can a business avoid the fate of the railroads and the Postal Service? What can a business do to be less product-centric, and more customer- or solution-centric?

Begin by asking yourself, “What business am I really in?”

What’s the core need that your products or services solve for your customers? What other means are available for solving those same problems?

How has the environment in which your customers use your product changed? The invention of the telephone in 1871 and the first email system in 1971 were both significant environmental factors that ultimately affected the usefulness of direct mail.

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There’s a company in Maine that used to derive its revenue almost solely through custom-printed forms. But as online billing and electronic commerce reduced the need for printed forms, that same company established a thriving electronic payment and forms processing business.

This company realized that it was in the information processing business, and not the forms business, and it adapted well to the changes.

No one among us has a crystal ball, and we can’t predict the future, but we can ask more questions, and ask them more often to better understand our customers’ core needs, and how best to address them.

Change happens much faster than it used to, and products and services need to keep pace with the change in order to remain viable, marketable solutions.

Don’t become a product seller when your customers want you to be a problem solver.

 

 


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