That is how W. C. Coleman found himself in a market that held extreme distrust of his product, but an exceeding demand for its services. A marketing consultant being particularly unavailable and unheard of at that point in history, Coleman sat down to figure out the problem all by himself. He racked his brains to find a way to prove the service reliability of his product before pushing a sale, and came up with the first service contract on a consumer commodity in U.S. He offered to rent his new lamps at the rate of $1 per week, and the lessee need not pay if the lamp failed to live up to its promise or became clogged. With this offer, Coleman succeeded to gain the toehold he required in the market to prove that his product provided reliable service.
His idea of renting out the gasoline lamps worked, and within four days of starting to offer his contracts, he succeeded in renting out all 12 of the demonstration lamps that he had with him. However, the company he was working for was yet to receive payment on the first lanterns, and refused to supply him any more. Coleman borrowed $1,000 from his brother-in-law, bought hundreds of lamps from the manufacturers, and set up the Hydro-Carbon Light Company. Before the end of 1901, Coleman bought the stock and patent rights to the lantern and spread across the country from his headquarters in Wichita Kansas. At a time, when many cities still lacked the supply of electricity, Coleman started targeting people who liked outdoor activities, with his product.
Coleman's marketing strategy had resounding success and sales went up to almost half a billion dollars a year. Today, more than a hundred years from the date of that ingenuous service contract used to win over a market that had lost faith, The Coleman Company has produced more than 50 million of Coleman lamps and sells more than a million of them every year.
Coleman's genius lay in recognizing that consumers were more concerned with the service of a product than the product itself, and in finding a way to be able to market the service with profit and prove product reliability without burdening the consumer with simultaneous product purchase. He knew that product sales would inevitably follow product performance, and to gain the chance of proving that performance he came up with a promise. A marketer, whose promises on his product had failed, had destroyed the market in Kingfisher, and to bring the situation around, Coleman used another promise: You can use the product and enjoy its services at a low initial cost and without actual purchase, while you pay nothing if the product does not perform. Essentially, all great marketing strategies depend upon conveying a concrete and acceptable promise to the consumer. Marketing succeeds if the promise is sustained, and fails if it is broken.
Sources and references:
Michael Gershman, Getting It Right the Second Time: How American Ingenuity Transformed Forty-Nine Marketing Failures into Some of Our Most Successful Products (Reading, MA: Addison-Wesley, 1990)
