Is It Better to Differentiate Products or Customers for Social ventures?

Whether it is a social venture or not, the products or the services it delivers must have a certain kind of customers. One product can hardly satisfy the whole population. Therefore, products will be designed based on the needs of target customers. For example, McDonald serves a limited kinds of food. It focuses only on those who needs food fast. On the other hand, there are also corporations producing a range of products to meet the demand of different groups of customers. For instance, L’Oreal Co., Ltd, which is a cosmetic group consists of four divisions. Each division focus on one kind of products, including luxury, consumer products, active cosmetics and professional products. It seems that anyone who needs cosmetic products can go to L’Oreal. Both kinds of corporations can achieve success. For social ventures, it seems that differentiating customers is much easier. There are products designed by different ventures to solve similar social issues, such as water clean. Due to geography and demography factors, one water cleansing system may not be universally applicable. However, is it possible that one Group can solve a social problem in every district?

First, it requires flexibility in products. For L’Oreal, new products can be developed by changing one or two ingredients. As to water cleansing system, it may need to change several things before it can be applied to another area. Water pollution, road conditions and local norms may all be different. Therefore, the question becomes that is there a product that can be easily transferred and whose filter can be adjusted to adapt to water conditions? Even if the answer is YES, will the costs be covered?

Secondly, it needs flexibility in business models. Full Court Peace is an organization dedicated to strengthening local communities through basketball. It has already carried out two programs in Belfast and Cuba respectively. Now, it plans to roll out in Juarez, Mexico. The childcare problem in these areas are expected to be relieved through basketball. In Belfast, kids from different communities start to talk to each other through basketball playing. Now in Mexico, the organization starts the program with the goal of keeping children from drug cartels. Programs in both areas go through similar procedures and the factors need to be considered are almost the same. The main difference is the way, the place and the time to hold activities.

Generally, from my points of view, social ventures who deliver services have more chances to expand business to various areas, while it is harder for those who sell products. Products need technology and time. However, services are more likely to solve the problems of people. Products can address the problem generated by the nature. The first type of problems are relatively easy to be solved. The latter type of problems is the cause for the disparity between areas. Thus, for a social venture, whether to differentiate customers or products depends a lot on the type of problems they want to solve and the impacts they want to achieve.