Tuesday, December 07, 2010

The $300 House: The Marketing Challenge

This is a great article  by Seth Godin!
Uvealblues

Triple the U.S. population by three. That's how many people around the world live on about a dollar a day. Triple it again and now you have the number that lives on $2. About forty percent of the world lives on $2 or less a day.
What's that like? It's almost impossible for most of us to imagine. I mean, $2 is the rent on your apartment for about 45 minutes. It buys you one bite of lunch at a local restaurant. And yet, two billion people survive on that sort of income.
The key word is 'survive'. Subsistence income means that every penny is needed, is spent. It means you are on the edge at all times. It makes life itself an emergency. If every single thing goes perfectly, then you and your family will go to sleep tonight healthy, not too hungry and fairly safe. But of course, every single thing almost never goes perfectly. If you are bitten by a malaria-carrying mosquito, you need to buy medicine and so there's no money for food. If you need more water, you have to spend two hours walking to and from the nearest half-decent water spot, and those two hours are the two hours you were going to spend harvesting the food your kids need.
(..)
Into this world, we welcome the $300 House. Its success will depend on the ability to create a market for the idea. How do we do that?
Any entrepreneur or marketer can learn a lesson from how new systems create new markets, and how an infinite increase in income or productivity can change everything. Everything.
Now, here's the kicker: If you're a tenth-generation subsistence farmer, your point of view, about risk, about life, is different from someone working in an R&D lab in Palo Alto. The Moral Economy of the Peasant makes this argument clearly: Imagine standing in water up to your chin. The only thing you're prepared to focus on is whether or not the water is going to rise four more inches. Your penchant for risk is close to zero. One mistake and the game is over.
As a result, it's extremely difficult to sell innovation to this consumer. The line around the block to get into the Apple store for a gadget is an insane concept in this community. A promise from a marketer is meaningless, because the marketer isn't part of the town, the marketer will move away, the marketer is, of course, a liar.
(..)
So you see the paradox. A new product and approach and innovation could dramatically improve the life and income of a billion people, but those people have been conditioned to ignore the very tools that are a reflex of marketers that might sell it to them. Fear of loss is greater than fear of gain. Advertising is inefficient and ineffective. And the worldview of the shopper is that they're not a shopper. They're in search of refills. They are in water up to their chins.
So how can the $300 House be marketed effectively? The answer is in connecting and leading Tribes.
It lies in engaging directly and experientially with individuals, not getting distribution in front of markets. Figure out how to use direct selling in just one village, and then do it in ten, and then in a hundred. The broad, mass market approach of a Western marketer is foolish because there is no mass market in places where villages are the market. It has worked with other products. It can work with the $300 House.

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