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The Propensity To Buy Matrix

The Propensity To Buy Matrix contrasts the uniqueness of your product with the customer’s knowledge of your business to create four sectors with different propensities to buy.

I read about it in the book, Marketing by Matrix by Malcolm McDonald and John Leppard and wanted to share it with you.

What Is The Propensity To Buy Matrix?

This is presented as a two by two matrix, effectively forcing High/Low choices but I don’t see why it can’t be used in a three by three matrix with High, Medium and Low options.

The dimensions of your matrix

  • Your product or service can be split between Me-too or Unique.
  • The knowledge of your company can be split between Well Known or Unknown.

The Propensity To Buy Boxes

In a 2 x 2 matrix, this then gives four boxes.

  1. Me-too product sold by a well known company – success depends on the marketing push. Brand familiarity is in your favour but prices and margins are likely to be competitive.
  2. Me-too product sold by unknown company – this is the problem box with both factors against you. Research has suggested you have a 90% probability of not selling. I’m surprised it isn’t higher.
  3. Unique product sold by an unknown business – while customers may be suspicious of dealing with a company they have never heard of, the benefits of the product may overcome their doubts or the company can intensify its promotions on a targeted customer basis.
  4. Unique product sold by a well known company – this is the ideal situation and research suggests it should result in a sale 90% of the time.

My Thoughts

I like this matrix because it puts the two fundamental marketing issues into clear focus.

The tasks of the business are to:

  1. Develop products that have more unique qualities desired or valued by the customers.
  2. Get the business brand and product brand to be better known.

Incidentally these are steps 2 and 3 of my Six Steps Profit Formula.

It also suggests a route from the worst position – unknown brand with me-too product upwards as first developing more differentiated products and then work on getting the brand more publicity and attention.

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