Dexit - A Marketing Opportunity

Dexit is a new electronic payment system that offers a convenient alternative to cash for small-value retail transactions. The chief executive officer is faced with some critical target market and marketing mix decisions as she prepares for launch. The situation is complicated by the fact that action is needed on two fronts: Dexit must not only recruit end-consumers to use the service, it also has to convince merchants to install the payment terminals. Since paying with cash is free, the company will need to persuade both groups that the added convenience of Dexit justifies a transaction fee. Although the concept appears to have good potential, the recent test market failures of two similar offerings suggest that success is far from guaranteed. The case reinforces the importance of solid consumer analysis when selecting a target market, demonstrates the concept of value to the customer, and provides a basis for discussing push versus pull marketing strategies.