Intuit develops and sells financial and tax solution software for consumers and small and medium-sized businesses. The company was founded in 1983 by a former Procter & Gamble employee, Scott Cook, and a Stanford University programmer, Tom Proulx, after Cook realized there must be a better way to automate his bill-paying process. For almost 30 years, Intuit’s mission has been to “revolutionize people’s lives by solving their important business and financial management problems.”
Intuit launched its first product, Quicken, in 1984 but almost went out of business twice during its first few years. In order to survive, Intuit changed its distribution strategy and sold its software to banks. After some favorable reviews in the trade journals and an effective print advertising campaign that featured a 1-800 number, the company got its first break. By 1988, Quicken was the best-selling finance product on the market. In 1992, Intuit launched QuickBooks, a bookkeeping and payroll software product for small businesses, and went public the following year.
Intuit grew quickly in the early 1990s, thanks to the success of Quicken, QuickBooks, and TurboTax, its tax preparation software program. Intuit’s products did something for small businesses that more complicated accounting packages didn’t: They solved finance and tax problems in a simple, easy-to-use manner. Intuit had recognized correctly that simplicity was the key, not in-depth accounting analysis. By 1995, the firm held a 70 percent market share, and Microsoft tried to purchase it for $2 billion. The Justice Department, however, blocked the deal as anticompetitive, and the buyout collapsed.
From 1995 to 1997, Intuit’s stock tumbled 72 percent and the company was forced to refocus its strategic efforts. It turned to the growing power of the Internet, online banking capabilities, and valuable insight from extensive consumer research to develop new products. This new strategic focus and emphasis on consumer research helped improve the company’s stock value and market position in the early 2000s.
In 2007, Scott Cook wanted the company to focus even more intently on innovation. As a result, he adopted an up-and-coming approach to product development called design thinking. Design thinking is an unconventional way of problem solving that incorporates extensive consumer observation and research with trial and error and ongoing product prototyping.
Today, Intuit spends a significant amount of time and money—approximately 20 percent of net revenues—on consumer research each year. This research helps Intuit understand exactly how customers use and feel about their products and keep abreast of technology, consumer needs, and competition.
Field research helps Intuit uncover insight in a variety of ways. During a Site Visit, Intuit researchers visit the individual’s home or office to observe exactly how products are used, what works well, what frustrates users, and how products can be improved upon. A Lab Study invites consumers to one of Intuit’s research labs to test and experiment with Intuit’s new products and ideas. During a Remote Study, consumers are interviewed over the phone and often asked to view new design concepts over the Internet. Intuit also conducts an ongoing extensive research study with the Institute for the Future to learn more about the future trends affecting small businesses. The company uses what it learns to improve versions of its products each year and better understand the next generation of financial and tax software.
Intuit’s in-depth research recently led to innovative new products and services. For example, employees watched younger consumers get frustrated using an Intuit tax software program because they couldn’t take pictures of their tax forms and complete their taxes via their mobile device. This frustration and Intuit’s keen empathy for the consumer led to the development of a tax app called SnapTax. Launched in 2010, it has since been downloaded more than a million times.
Demand for Intuit’s products is seasonal, and its marketing efforts are typically concentrated around tax preparation time—November through April. During that time, Intuit develops promotions with original equipment manufacturers (OEMs) and major retailers via direct mail, Web marketing, print, radio, and television.
While Intuit’s marketing campaigns have evolved over the years, positive word of mouth and exceptional customer service have been its most effective marketing tools since its early days. Harry Pforzheimer, chief communications officer and marketing leader, explained, “It’s a little harder to measure but when you know that roughly eight out of 10 customers bought your product because of word-of-mouth that’s a pretty powerful tool . . . So engaging with our customers directly is part of our DNA and communicating with customers on a timely basis is critical. And that timely basis now is instantaneous.”
Intuit has expanded globally through new product and service offerings and through strategic acquisitions. Its purchase of Mint.com, for example, added value by giving consumers another tool to analyze their spending against a budget. Intuit also acquired Demandforce, which added the ability to provide online marketing and communications tools for small businesses. In 2009, Intuit ‘ won a rare fight against Microsoft when the software giant discontinued its Money product line after an 18-year battle with Quicken. And the company’s expansion into mobile solutions has encouraged younger consumers to adopt its finance and tax software. Intuit now has more than 50 mobile applications, and more than 45 million customers have used its cloud-based services in the past five years.
As Intuit expands globally, it is developing new products for consumers worldwide. In India, for example, Intuit launched Fasal, a service that gives hundreds of thousands of farmers up-to-date marketing information to help them get the best price for their crops. Intuit earned $4.51 billion in revenue for fiscal year 2014, primarily from Quicken, QuickBooks, and TurboTax sales.
Source: Kotler Philip T., Keller Kevin Lane (2015), Marketing Management, Pearson; 15th Edition.