Customers Buy Benefits, Not Betamax

You may be better than the competition, but if you don’t respond to your customer’s essential needs, you could become obsolete. Just ask Sony.

Consumers do not buy products, they buy benefits.

As marketers, that’s ingrained in us. We know that effectively marketing the benefits of a product or service can overcome pricing differences, highlight your competitive advantages, and build successful customer relationships that provide long-term, sustainable revenue to an organization.

Still, it’s good to be reminded every once in awhile. Demonstrating to consumers how a product will benefit them in both the short term and over the long haul is critical to its success. Customers—government, commercial, and individual shoppers—make purchases to fill specific needs and to receive the benefits of filling those needs.

Simply stating what a product does isn’t enough because, in any given industry, many different products/services will be available with the same essential features. A successful marketing campaign solves the problem(s) a particular market segment experiences. Unless a business operates in a niche market with few options, such as VHS cassette movie rentals, a product’s success or failure lies in its ability to differentiate itself from its competitors.

A perfect example of this lies in the cautionary tale of the now obsolete Sony Betamax, the very first video cassette player, introduced in May 1975.

Nostalgia marketing is an important component of consumer engagement. As advertisers increasingly target GenX buyers, 1980s nostalgia is everywhere. It started innocently enough: occasionally you’d hear a commercial set to ELO’s Mr. Blue Sky. Now you can’t escape it. Look up from your phone or tablet during a Hulu or Paramount+ commercial break, and you’ll see all kinds of 1980s relics: leg warmers, parachute pants, boom boxes, Sony Walkmans…even the occasional can of Aqua Net.

One thing you will NOT see is a Sony Betamax video cassette player.

VHS players, yes.

Betamax? No.

Beta is all but forgotten in pop culture. The reason for that is simple: Sony failed to explain Betamax’s benefits to consumers, and customers buy benefits, not products.

Even in the pre-digital, Internet-free era of neon roller rinks, a marketing strategy that recognized and alleviated customers’ pain points was critical to a product’s success. There are many reasons why Sony lost the VHS Wars, but a key component was Betamax’s promotional strategy. A quick review of Sony’s advertising shows print and video effectively listing Beta’s features, but not explaining to its target market how those features will directly benefit them. For example, Betamax’s shorter recording time was due, in part, to the higher picture quality Betamax offered over VHS. Sony mentions the higher picture quality in its advertising but does not explain how this would have been important in the days when home televisions were typically no larger than the top of a kindergartner’s desk.

Another flaw was Sony’s failure to recognize and provide with Betamax one of the key features customers wanted at that time: longer recording time. VHS offered the advantage of being able to record an entire movie on a single tape. Sony stuck to a one hour maximum recording time until it was too late to win a battle, much less a war.

Sony's failure to recognize and tailor its Betamax marketing strategy is a cautionary tale of what happens when a company focuses on marketing a product, not the product's benefits. There are others, of course. Does anyone remember Apple’s Newton?

Probably not, and, unless you’re a die-hard consumer tech fan, it doesn’t really matter. In the long-term, digital communications and the Internet made much of the analog entertainment industry of the mid-1990s obsolete.

What does matter is the lesson Sony’s Betamax marketing strategy reminds us of: don’t talk about what your product does. Talk about what your consumer needs.

Always good to have a reminder.

Cheers,

—C.

Sources:

APMP Body of Knowledge; Focus on The Consumer: Features, Benefits, and Discriminators. Accessed May 21. 2024. 

Barden, P. (2022). Decoded : The science behind why we buy. John Wiley & Sons, Incorporated. 

Fan, Yafeng, Jing Jiang, and Zuohao Hu. “Abandoning Distinctiveness: The Influence of Nostalgia on Consumer Choice.” Psychology & marketing 37.10 (2020): 1342–1351. Web.

Cusumano, M. A., Mylonadis, Y., & Rosenbloom, R. S. (1992). Strategic maneuvering and mass-market dynamics: the triumph of VHS over Beta. (includes appendices on VCR industry chronology, Sony product schedule from 1975-85, JVC product schedule from 1976-85). Business History Review, 66(1), 51+. 

Rosen, D.E., Jonathan E., Schroeder, E., Purinton, F. (1998). Marketing High Tech

Products: Lessons in Customer Focus From the Marketplace. Academy of Marketing Science Review, 1998, 1. 

Mullins, J.W., Walker, Jr., O.C. (2013). Marketing Management: A Strategic Decision-Making Approach, Pp. 11-15, 17-19.