A ‘Lemon’ is an American slang for a
defective car which is identified as defective only after it has been
purchased. In this world of social media, lemons cannot remain undetected for
long. And when they are identified, they can tarnish the image of any company
exponentially. The word can also be used to describe a product that may have
failed despite all efforts.
Reputed companies try and maintain
quality and provide good products to their customers. They put in a lot of
research and spend lot of money in segmentation, targeting, positioning and
developing their products. But product development takes time as technologies
are to be developed, prototyped and tested before they can be launched. If a
company does not keep track of the dynamics of a fast moving market, it may
land up with products that people do not want anymore. In other words, a
company may land up with a lemon even if not intentionally.
These lemons, however, offer the
companies a chance to pause and study the market again. To introspect and
determine whether they understood their customers wrongly or if they had biases
and pitched their products using the wrong tagline. These products give the
companies opportunities to understand the changed environment and go back to
the drawing board. They get an opportunity to innovate. These innovations may create
new markets, new segments or new products which may become game changers.
One of the biggest lemons launched was
the Ford’s
Edsel models. These cars were designed and positioned after detailed
market research. The company introduced a number of innovative technologies in
the car also. It was expected to be a great success by Ford, but the cars
bombed on the market and production stopped within three years of commencing.
Ford realised that something was happening in the automobile market that was
against all assumptions made by automobile companies for designing and marketing
their products. This change was that the market could no longer be segmented as
per price range of vehicles. Vehicles were becoming an integral part of the people,
as a result, people wanted these vehicles to be an extension of their
lifestyle. This encouraged Ford to segment the market as per lifestyle and one
of the products of this segmentation was the Pony Car, the Ford Mustang. This
model is still in production and has become an icon in the automobile industry.
Second example is of the Tata Nano. It
is an extremely innovative product using lean and economical manufacturing
techniques. But it also did not do as well as the company expected. Reasons? Though
the intention was good, to provide affordable personal transport to masses, the company did not
take into consideration that in India, as in any growing market, the car is an
aspirational product. It is a symbol of prosperity.
What is important here is that neither
of the two products were bad, in fact both the cars were very well engineered.
As the response of both the companies
show, failure of good products make the companies sit up and take stock of what
else can go wrong. This pause helps them to identify new opportunities which
help them grow further.
Lemons in a way… are Good!
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