Ecommerce – Planned Obsolescence

Ecommerce Product Life
Ecommerce Product Life

Many will have  never heard of the term planned obsolescence.  The term stems from the period prior to 1920, when retail products were made with the purposeful intent to stand the test of time. These high quality products were sturdy; often hand machined piecework, and ultimately provided and excellent long term investment for the consumer.

Business owners, however experienced and unforeseen problem in the lack of of return customers and residual income. You see, you can have all the satisfied customers in the world, but if you can not convert them in to repeat customers, then the longevity of your business is doomed.

In the 1920’s and 1930’s businesses began adopting the process of planned obsolescence to tackle this business killing issue. Ultimately this meant that the products consumers bought would not last as long because product parts were intentionally designed to wear out near or at the end of their planned lifespan. In other words if a company planned for a vehicle to last ten years then parts would begin to wear out after 10 years or the total number of miles driven for a statistically generated 10 year average.

Essentially a company would use their sales trend and loyalty statistics to determine how long they wanted to wait for a repeat sale and then advertise the life of the product (EX: a blender for fifteen years). Then the company would produce parts or acquire parts as cheaply as possible to only reach or slightly exceed the life expectancy of the product… Thus creating return customers.

By reducing the once very long time between purchases of replacement products the companies actually began to see an increase in long term repeat sales. This in itself breeds additional sales opportunities. For example, you may be looking for a new washer and I can then tell you about the 3 washers I have had from X Company which have lasted long and been trouble free… Boom word of mouth marketing. Note that also, since purchases happened more often, the consumers had the details and information about these products more present in their mind, which only increased the word of mouth marketing as well. America has become accustomed to the need for replacement products. In fact, this technique, carried to its modern extreme we would almost be disappointed if we didn’t need to replace common items occasionally.

In the brave new world of ecommerce the functionality of planned obsolescence is a very important component in determining what type of products you will carry in your online store. For example if you develop your business around a popular product which has an extended life expectancy you would need many more customers over a longer period of time than if had chosen a product that is popular still, but is often replaced by a smaller customer base. This long term planning of “meat and potato” sales can be the difference between selling a quality furnace one time and furnace filters thousands of times….. Or both!

Electronic devices differ greatly as they may have the ability to last longer than they are typically used, but most consumers will replace them regularly when the next newest gadget is released. In this case planned obsolesce is made possible simply due to consumer demand for increased functionality and America’s love of gadgets.

An online store developed around candles is an example of the need for a higher volume of customers. Your average consumer does not light a candle each night, so the need for additional candles is somewhat diminished no matter how beautiful or well scented the candles you sell might be. In this case a clear marketing emphasis on giving candles as gifts may allow existing customers to more easily convert in to repeat customers.

This post is not really designed to encourage you to pursue one type of product over another, but to draw your attention to the dynamics hiding just below the surface related to consumer purchasing patterns of certain items. This post is however designed to get you thinking about the life expectancy of the item’s usefulness and how you should ultimately market the product for the best reach and return overall.