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Jay Haynes

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How to Cut through the Clutter with Smart Product Positioning

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Issue: Too Much Competitive Noise

Positioning your product is key to fostering a unique connection with your customers. When a product or brand is positioned well, it’s easy to point out. There’s no confusion around what the product does, it makes it clear how it differs from its competitors, and when new products are launched, everything feels succinct and connected. And when customers are ready to buy, that clarity is what will drive them to choose your product over any competitors.

However, instead of creating an overarching market position, companies often rely on product features to position themselves as more valuable to the competition. This is a mistake as competitors can simply launch new features and continue to beat you with the same approach - an unending game of feature catch-up continues. Customers won’t be able to understand the difference and will get confused about what solution they should turn to for help.


Traditional Way: Positioning with Product Features  

It’s likely that you’ve studied various best practices when it comes to product positioning, including Harvard Business School Professor Michael Porter’s definition.

Michael Porter defined a competitive position in his 1985 book Competitive Strategy as a way of achieving competitive advantage. Porter identifies four different competitive positions based on broad or narrow market focus and product cost or product feature differentiation.

Cost Leadership Position

A cost leadership position means that you are targeting the broad market, but you have lower costs than your competitors. So you can generate more profits with higher margins, or you can lower your prices to customers and take more market share. Walmart is an example of this. They are known for low prices.

Cost Focus Position
Porter's cost focus position is when you focus on a narrow or niche market with a low-cost product, such as Huawei.

The Differentiation Leadership

The differentiation leadership position is when you satisfy needs with your product differently than your competitors in the broad market. Apple’s iPhone is a great example of this.

Differentiation Focus Position

The differentiation focus position is when you satisfy needs with your product differently than your competitors in a narrow or niche market.

Although this breaks down the different approaches, how do you execute on this positioning method? How do you apply this to your market and your product?

You are probably already using industry best practices to lower your costs. But because you and your competitors are likely using the same best practices, lower costs on their own are likely not enough to lead you to success unless you are in a true commodity market.  So your focus should be on differentiating your product’s value. Unfortunately, Michael Porter doesn’t tell you how to do this. He also doesn’t explain how you should determine if you should target the broad market or the narrow market.


JTBD Way: Focus on the Job Steps

The key difference in JTBD positioning is that you don't use the product features to position the brand or product. Instead, you look at the steps a customer takes to get a job done and you focus on those steps.

In order to identify the best competitive position, you need to first identify the underserved customer segment using needs in the job. Who is struggling the most with this particular JTBD? After that, you’ll break out the job steps within the JTBD and identify the underserved job steps with unmet customer needs. Focusing on those specific unmet needs in the job steps is where you can begin to create a unique position.

Benefit:  Generate Growth from Consistent Positioning

JTBD makes it easier to generate growth out of new products because it helps companies avoid being stuck in a "product-focused position". Companies often fear launching and selling a new product because it may confuse their brand position with customers. For example, retailers might say they could never provide a service because customers don't know them for that.

If you make yourself known for a job or steps within a job then it's easier for the team to believe they can release a totally new product and easier for customers to buy into it.

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Why 95% of Product Teams Fail at Defining Customer Needs

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Issue: Disagreement on Customer Needs

Your goal as a company is to build, market and sell products that satisfy customer needs better than competitors. Although it may sound oversimplified, identifying exactly what your customer’s needs are isn’t so straightforward for many teams. Research published by MIT Sloan found that 95% of all companies do not have an agreed-upon definition of a customer need. It’s likely your team also tends to argue about this.

Without an agreement on customer needs, teams often use customer requests, sales requests, feature ideas, or technologies as inputs into product development. Although these may offer helpful insight into how to connect with your customer, none of them provide your team with an unchanging, consistent definition.

In this post, we’ll teach you how to define a customer need, how to identify customer needs in your market, and how to organize needs to make them useful for your teams.

Traditional: Relying on Changing Input to Drive Product Roadmap

With the traditional product development process, when a new launch fails to generate growth, your team is left to iterate or pivot using more changing inputs. By trying to hit a moving target, teams are basically guessing at what customers want. This eventually leads disagreements, arguments, and harmful company politics, and it ultimately leads to a company's death spiral. It is why products, companies, and often careers fail.

Blackberry, Britannica, and Kodak all lost billions of dollars in equity value because they did not have a stable and quantifiable definition of customer needs. They defined their markets based on changing products and technologies, not on stable jobs and needs. You need a detailed customer need definition to make Jobs Theory useful and actionable for your team and your company.


JTBD Way: Focus on Unchanging Customer Needs

The best way to avoid trying to hit a moving target is to focus on the customer’s job-to-be-done. A customer’s job never changes and JTBD provides you with clear criteria on how to identify the customer’s job steps and needs within the job. It serves as a stable target for your team to hit, regardless of what product, services, or technologies evolve. You can learn more about how to answer the question of what your customer’s job-to-be-done is in this post.

Similarly, your customer's needs in their job will not change either. Like the job itself, needs are stable over time because they are also independent of any product, service or solution.

Let's look at our Apple and Google Maps example with the job-to-be-done being “get to a destination on time.” This is a stable job that will never change as opposed to “figure out a route to work” or “catch the next bus.” Getting to a destination on time becomes the market in this case.

But if we want to build a superior product, knowing the job isn't enough. We need to double-click into the customer needs to determine what product features we should build to get the job done better than Apple and Google.

In order to get to a destination on time, a lot of variables come into play (e.g., know the arrival time, the address of the destination, how long it will take to get to the destination, the optimal sequence of planned stops and if the destination can be reached on time). These are all variables in the job. In order to achieve their goal of getting to a destination on time, consumers need to do something with each of these variables; they need to take actions on them (e.g, calculate how long it will take, determine the optimal sequence, etc.).  These actions along with each of the possible variables are what the customer needs to do to successfully achieve the goal and get the job done.

Since every customer need has an action and a variable, you can measure the speed and accuracy with which customers can satisfy a need. This is the true power of Jobs-to-be-Done. You now have the ability to measure the speed and accuracy of your customer's needs to determine why they are unsatisfied in a market.

Benefit: Align Your Team on Customer Needs

To recap, customer needs are actions a customer must take using variables required to get the job done. Customer needs in the job, like the job itself, are stable over time and they have no solutions. This means that your team will have a stable target to hit. Structuring needs this way makes Jobs Theory useful and actionable for your team. It provides them with a shared focal point and a clearer understanding of what they are building, selling and marketing to customers.

If you want to figure out the next steps in identifying and measuring your customer’s needs, take our Jobs-to-be-Done online course.

Posted by Jay Haynes , 1 comment

Why JTBD is the Only Fail-Safe Product Strategy

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Issue: Confusing Operational Efficiency with Product Strategy

Choosing the right product strategy is critical to your success and your ability to create equity value for your company. But many companies do not have a clearly defined definition for a product strategy. People often confuse operational effectiveness with strategy, focusing on their internal goals like reduced costs or revenue growth. Creating a product strategy based on your company and not your customer can quickly create a misalignment among teams, causing higher costs and unending arguments.


Traditional Way: Company Focused, Not Customer Focused

The traditional way of defining a strategy is to focus more on what you are going to do for your company rather than saying what you are going to do for your customer. “Our strategy next year is to increase budget, hire a team, invest in a new marketing channel, etc.” None of that is what you will do for your customer.

In 1996, Harvard Business School Professor Michael Porter wrote a famous paper called “What is Strategy?” Companies often use Michael Porter's definition of strategy, since he was a pioneering academic in the field, famous for analyzing industries to determine competitive strategy.

In Porter's view, “the essence of strategy is choosing to perform activities differently than rivals do.” Activities companies perform include manufacturing, engineering, distribution, marketing, and selling. For example, mobile phone companies each perform these activities but they have had very different results.

In many financial reporting periods, Apple has had 98% of the profits in the industry and it isn't because Apple performs activities differently, as Michael Porter would predict. In fact, Apple uses Samsung to perform some of their manufacturing activities.

Apple has leading profit share because they satisfy customer needs differently than their competitors, enabling them to take leading profit share. Successful strategy satisfies needs differently than your competitors. So customer needs, not activities, should be the focus of your product strategy.

This is why Michael Porter is outdated.

Because in 1996, MP didn't have the customer's JTBD in his strategy toolkit. Performing different activities from your competitors is important, but anyone can copy activities using industry best practices. Satisfying your customers JTBD in a unique way is harder to copy.

Needs in your customer's job-to-be-done, not your activities, should be the foundation of your strategy because your customer's JTBD tells you what activities to perform to satisfy your customer better than your competitors.

JTBD Way: Choose a Customer and Focus on Their Unmet Needs

A product strategy is making three choices - identify which job beneficiary to target, select which job-to-be-done to fulfill, and determine which platform you are going to use to satisfy customer needs differently than your competitors.  

Let's look at a well-known example to demonstrate why a JTBD-based product strategy definition is more useful. We all have executed the job of creating a mood with music. While the products have changed dramatically over time, the job is stable and has not changed.  The needs in the job have not changed either.

For example, one need in creating a mood with music is to find a new song for the mood. This need follows the job-to-be-done structure with an action and a variable. So we can measure the speed and accuracy of different platforms satisfying this need.

Let's look at how satisfying this need has changed over time with the arrival of new platforms that led to different product strategies. In 1984 when the CD was released, finding a new song for the mood was time-consuming and often very inaccurate, because you often couldn't find a new song. The speed was slow and the accuracy was low because consumers were forced to buy entire albums.

Then, CD changers emerged to help with this need by enabling consumers to search their library for songs. But finding a new song for a mood was still time-consuming and not always accurate. The iPod of course, was a huge improvement because it reduced the steps and time significantly. Accuracy was improved with the introduction of the iTunes store, but you still might not be able to quickly find a song for the mood.

However, Microsoft was clearly not using customer needs in the job to create their product. In 2007, Microsoft’s Zune simply tried to copy what Apple was providing without making the experience faster or more accurate. This is an excellent example of why products succeed or fail with the right product strategy.

But Pandora launched with different product strategy using a new platform: streaming. Pandora's streaming and music taste algorithms satisfied this need faster and more accurately. When Pandora launched, it was signing up 90,000 new users per day because it satisfied unmet needs in the job faster and more accurately.

This is a great example of where product strategy can lead to success or failure. A company with enormous resources (Microsoft) chose the wrong product strategy (i.e. using a hard drive to satisfy needs in the same way as the iPod) and it led to failure. In contrast, Pandora chose a differentiated strategy to satisfy needs faster and more accurately and it took Apple an entire decade to launch a competing streaming service.


Benefit: Align your team around one central strategy

To recap, you create a product strategy by identifying a job beneficiary and job to target, and then choose a platform that will satisfy unmet customer needs faster and more accurately than your competitors.

Using Jobs-to-be-Done as the foundation for your product strategy means you will have a strategy that is unambiguous and easy to remember. Everybody is aligned and it gives you direction on what to do in your department to fulfill strategy. It mitigates risk because you know whether or not you're building the right platform or not. 

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Stop the Downward Spiral of Feature-to-Feature Comparison

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Issue:  Miscalculating Your Real Competitors

Creating equity value in your company comes down to one thing - your ability to satisfy customer needs better than competitors in your market. This is why competitive analysis is critical to your product strategy. But often times, product teams use traditional “industry” research to identify their competitors, creating a product roadmap based mostly on what features are already in the market. The challenge with this thinking is that you risk playing feature catch-up while your real competitor sneaks up behind you and steals significant market share.

In this post, we will teach you how to identify your real competitors. You will also learn how to identify competitor weaknesses that you can exploit to create more equity value for your company with less risk.


Traditional Way: Feature Parity Drives Product Strategy

In traditional competitive analysis, product teams often compare their own product's features to a competitor's features. If Product A has all of the features of Product B plus a few more, then Product A has the advantage. In their minds, more features equal competitive advantage. The problem is that customers don't want features; they want to get their job done.

Focusing on feature-to-feature comparison is the wrong way to think about competitive differentiation. Your team will be constantly trying to catch up - with very little chance of actually doing so. If you've ever been on a team that is playing feature catch-up, you know it's like bailing water out of a leaky boat: every time you release a feature and think your work is done, your competition releases something new, racing ahead of you yet again. You will always be a step behind.


The problem is that customers don't want features;
they want to get the job done.


For example, Microsoft thought they caught up to the iPod by including all of its features in the Zune. Apple launched the iPhone. Microsoft tried to catch up again with the Windows Phone. Playing catch-up leads to failure.

Plus, just because it's market standard, doesn't mean it's the best way to do it. What seems like state of the art today will be archean tomorrow.

JTBD Way: Focus on Your Customer’s Unmet Need

Your customers' struggle to get the job done causes them to look for new competitive solutions to get the job done faster and more accurately. In order to beat your competitors, you have to start with where the customer struggles to get the job done and figure out where the competitor is failing. Where are they not getting the job done fast or accurately enough?

First, identify all the competitors (products, services, technology, or manual processes) that satisfy needs in each step in the job. Then calculate the speed and accuracy with which the competitors satisfy the needs in the steps.

Let’s look at an example of a customer job-to-be-done creating a mood with music.

The Zune team at Microsoft compared the Zune to the iPod using traditional product feature analysis. The Zune actually had more features than the iPod, including a Podcasting feature. But this analysis did not help determine if the Zune was going to take market share from the iPod.

This analysis is flawed because customers don't want features, they want to get their job done. Zune, for all of its features, was getting the job done in the exact same way as the iPod.

Pandora, however, had fewer features than the iPod, but because it had a different feature (automatically generated streaming playlists) that satisfied an unmet need in the job of creating a mood with music, it was able to grow successfully and create equity value.

This illustrates why your competitive analysis should not be based on feature comparisons - because feature comparisons are not predictive of your growth.  

The speed and accuracy with which the competitive solutions satisfy the needs are the benchmark for how good your new solution needs to be. If it does not satisfy the needs faster and more accurately, you have not given customers sufficient incentive to switch to your product.


Benefit: Lead Your Market, Instead of Following

Focusing on your true competitor, you will avoid the risk of wasting capital and feature catch-up. With Jobs-to-be-Done, you’ll figure out where the customer struggles to get the job done, and where the competitor doesn't help the customer get the job done fast or accurately enough.

Want to figure out your true competitor? Take our online Jobs-to-be-Done course today.

Posted by Jay Haynes , 0 comments

How to Size Your Market & Calculate a Customer's Willingness to Pay

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Issue: Incorrectly Sizing a Market Leads to Product Failure

Market sizing is used to determine which markets are worth investing in. If a product wins its market, it still may not be worth building if the market is not large enough to generate a sizeable return. To make this decision, you need a good definition of a market.

What is a market?

The traditional way to size a market is to use a product-based market definition and a formula that looks something like: product price * number of buyers = size of market. But what do you do when your market sizing calculation leads you to invest in an existing product category that totally goes away when it is disrupted by a brand new invention?

And how would you size the market for that new product category and know whether or not it’s worth investing in? Defining and sizing your market incorrectly can lead directly to product failure and missing enormous opportunities.

In this post, we’ll show you how to avoid traditional market sizing mistakes by using Jobs-to-be-Done to size your market.

 

Traditional Way: Incorrectly Sizing a Market Leads Directly to Product Failure

Let’s look at an example of using the traditional product-based market sizing formula.

In 2007, you could have looked backward at iPod Sales and seen that Apple sold 200 million units at a price of $150. Our traditional formula (product price * number of buyers) tells us that the iPod market was $30 billion and the MP3 player market was even larger.

In 1990, you could have tracked sales of encyclopedias (Britannica alone sold 120,000) and identified a multi-billion dollar encyclopedia market.

In 1996, Kodak’s revenues reached $16 billion as it dominated sales in the enormous film market.

All of these market size calculations would have fooled you into making terrible business decisions.

Kodak went bankrupt in 2012.

Encyclopedia Britannica was sold for half its value in 1996.

And in fact, Microsoft thought the MP3 player market was so attractive, they invested in the Zune, which they wrote down as a $289 million loss in 2007. With the launch of the iPhone, the MP3 player market went away.

In 2007, customers didn’t want iPods anymore than they want records, cassettes or CDs. They wanted to create a mood with music.

“Creating a mood with music” is a job your customers want to get done and they hire product solutions to do it. In fact, the MP3 player market never existed. “Creating a mood with music” is the market.

The product-based definition of the market will lead you astray. Markets defined with Jobs-to-be-Done will remain stable over time and give your team a clear target for innovation. Sizing your market based on the customer’s job will help you put a dollar value on new product categories your company should invest in that cannot be sized looking backward at old product sales.

 

JTBD Way: Using Jobs-to-be-Done to Size Your Market

To size a market opportunity, don’t analyze the products currently in the market. Instead, analyze the willingness to pay to get the job done.

  1. Define your market as a goal customers are trying to achieve (a job-to-be-done)
  2. Identify the range of your customers’ willingness to pay to get that job done using interviews and surveys.
  3. Chart the answers on a scatter plot and draw a best fit line through the points. The area under the curve is the size of the market. This will help you identify if the biggest opportunities are in the premium market or the low-cost portion of the market.

 

 

 

Let’s look at an example. How would you do this if you wanted to take share from Google Maps and Apple Maps in which the traditional market sizing formula would show us a market worth nothing ($0 * Billions of users = 0)?

  1. Define the market not as the ‘map app’ market but as a job-to-be-done e.g. “get to a destination on time”.
  2. In interviews and surveys ask people who need to get the job done how much they would be willing to pay to get to their destinations on time every time they tried to it.
  3. Chart the range of answers on a scatter plot and calculate the area under the curve.

We actually did this research at thrv and found a premium ‘get to a destination on time’ market worth $2 billion. These customers are willing to pay for a new solution because they cannot get the job done effectively with the existing solutions in the market. In other words, they have unmet needs in the job.

 

Benefit: Make Confident Decisions in Your Product Investments

When you have an idea for a new product, it can be hard to answer the question “Is the market big enough for it?” when all you have is sales of existing products to size your market. If you use Jobs-to-be-Done to size your market, you will be able to justify investments in new product categories that make your company the leader. Instead of launching products like the Zune into markets that are about to disappear and recording losses, you will be focused on stable markets and be able to defend and win investments in products like the iPhone. You will accelerate your company’s growth.

Want to learn exactly how to apply this to your product and company? Take our Jobs-to-be-Done online course. After creating your own market sizing analysis, we’ll show you how to then identify unmet needs in your customer’s job-to-be-done and stop relying on demographic-based personas.

Posted by Jay Haynes , 1 comment

How to Find the Customer Segment That Will Actually Buy Your Product

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The goal of market segmentation is to identify a group of customers (a segment) who are different from the whole population. It is a tactic for product, marketing, and sales teams to relate to customers - the more of a story you can build about a potential customer, the better you can understand them. Powerpoint slides of customer personas are passed around the office for you to study. “Rachel likes to vacation in the Florida Keys.” “John has two children and works in ‘the city’.” It's an interesting description of a person, but what does it have to do with the product? And if you're a product manager, what does it have to do with you and your work?

The problem isn’t market segmentation as a whole, but rather how it’s being executed. If done well, segmentation can help you find a narrowly defined, underserved group of customers who are different from the total population and more likely to adopt your product. It can also help you understand how that group is struggling and how you need to improve your product to gain their business. 

"Selling to people who actually want to hear from you is more effective than interrupting strangers who don't."

- Seth Godin

What’s missing in many traditional approaches to segmentation is the true common denominator - the customers’ struggle. Traditional segmentation uses characteristics, such as demographic, psychographic, geographic, behavioral and situational attributes, to group customers. They’re hoping that they will correlate with a common struggle and a likelihood of purchasing your product. But the problem is none of these characteristics cause people to buy a product, their struggle with the job does. Customers will use products that help them get the job done better.

Read more about what a Job-to-be-Done is.

Often a broad population of people who have the same job-to-be-done, i.e. the same goal to achieve, struggles with the job in many ways and no particular struggle stands out as being especially severe. This makes it hard to determine which problem to solve and where to focus your solution. We use segmentation to identify a smaller, but valuable, group of people who have more specific and more severe problems on which we can focus. With Jobs-to-be-Done you can segment directly by struggle instead of using traditional characteristics.

In this post, we will show you how to find that attractive group of customers who will actually buy your product, review the limits of traditional segmentation and personas, and show you how to use Jobs-to-be-Done based segmentation to find underserved customers.  

The Challenge with Traditional Market Segmentation 

Persona development is not inherently bad if the persona includes how the segment struggles. But personas that are based only on characteristics are much less helpful because people do not buy products based on the school they went to, how tall they are, where they work or what they read. They decide to switch from one solution to another based on what pains them the most and what solution promises to remove that pain.


Let’s take a look at an example:

Here’s a traditional approach to using demographics and behavioral characteristics to develop two personas, Paul and Kate.


Paul’s Customer Profile:

  • Age: 27 years-old

  • Home: Lives in Manhattan (Urban)

  • Job: Entrepreneur

  • Education: Received an MBA from Wharton

  • Content Consumption: Reads the New Yorker, NY Times

  • Activities: Enjoys playing basketball on Saturdays with his friends


Kate’s Customer Profile:

  • Age: 56 years-old

  • Home: Lives in Forsyth County, Georgia (Rural)

  • Job: Administrative Assistant

  • Education: High school GED

  • Content Consumption: Local News is her primary resource

  • Enjoys cooking for family and gardening

Personas like Paul and Kate have two major drawbacks:

  1. They don’t help product teams figure out what to build because they don’t tell you what problems Paul and Kate have and if their problems are different from each other or the broad population you could target.

  2. None of these characteristics preclude Paul and Kate from finding the same solution useful. This can cause you to undersize your target market and miss a big opportunity.


In other words these characteristics aren’t why Paul and Kate buy the things they do. There may be a correlation worth noting in your analysis, but it isn’t the core driver.

Understanding Jobs-to-be-Done within Market Segmentation

When Paul and Kate need to get to a destination on time, they may struggle in the same way - regardless of their characteristics.In fact, when thrv researched how to take share from Google and Apple Maps, we found that there was a group of people who struggled similarly with planning multiple stops when they tried to get to destination on time even though they had totally different demographics, psychographics, etc, like Paul and Kate. They likely make frequent and unfamiliar stops and could be salespeople, medical professionals, delivery people, or anyone who confronts this situation on a regular basis.Not only did this group have common struggles, but they were different than the broad population who didn’t have such clear and severe struggles. This is a more useful way to describe a segment because it provides direction on what to build. If a new solution satisfies the needs related to planning multiple stops, this group of people are likely to adopt it. 

Characteristic-based segmentation would not put these two people in the same segment and would have caused us to undersize the addressable market and miss targeting likely buyers. Customers buy new products because they struggle to get a job done at a price they are willing to pay, regardless of their characteristics.

The same approach can be applied to B2B markets. Companies often define their customers using verticals like healthcare, consumer packaged goods, or financial services and firmographics such as the size of the company.  For example, if your company provides cloud storage to CIOs at medium-sized retail companies, you might never consider selling to large financial services companies because they are a totally different segment. However, if you consider their job-to-be-done: enable secure data use for their employees you might find that companies in different verticals and different sizes struggle in the same way to get the job done.

Traditional vertical segmentation does not reveal a group of customers who struggle in the same way to get a job done. In fact, our team conducted research in this market and discovered a very valuable segment of CIOs who struggle to enable secure data use for employees because they make frequent network upgrades, not because of their vertical or size.

Read More: How to Answer The Question "What's the job-to-be-done?"

Getting to the Right Market Segment for Your Product

Jobs Theory demonstrates that the struggle to get the job done causes a purchase. We call this struggle an unmet customer need. To determine which customer needs are unmet, we follow these four steps.

Step 1: Run a customer effort survey of people who try to get the job done.

Ask customers how difficult it is to execute each customer need in the job. This is a customer effort score--a high score indicates a high struggle to accomplish the need.

Read more about what a customer need is.

Step 2: Cluster the respondents based on which needs they rate as high effort.

In Jobs-to-be-Done segmentation, we use K-means clustering on customer effort scores to find underserved customer segments. You can use any clustering algorithm you like. The key is to cluster respondents around the needs they rate as high effort.

We’ve studied hundreds of jobs in this way. The remarkable thing is that when we cluster survey respondents by their characteristics, we very rarely see differences in the unmet needs between a given demographic, psychographic, etc. characteristic and broad market.  But if we cluster the respondents based on the unmet needs they have in common, we see clear differences with the broad market and often can identify a segment that struggles more severely and more specifically than the general population.

Step 3: Calculate the willingness to pay of each segment To identify the market size of each segment, and to determine which is the most valuable, we include a form of Van Westendorp price sensitivity questions but instead of asking about how much customers are willing to pay for your product, we ask how much they are willing to pay to get the job done. We plot their answers and draw a best fit curve through the scatter plot. The area under the curve is the size of the market.

Step 4: Target the most underserved segment with a sufficient market size

You have identified segments with unmet needs that are different from the broad market and you have calculated the willingness to pay of each segment. Now, choose a target segment that has the best combination of a high number of unmet needs you can satisfy and a market size that is large enough to justify the investment it will take to satisfy the needs.

Once you’ve selected the segment, you can use profiling characteristics to see if they will help you find it. Most advertising platforms use some form of demographics to target audiences. Look at the underlying profile traits of your target segment to see if they will help you distribute your marketing campaigns. If there are common traits among your segment, it can make your marketing efforts a bit easier. Often, though, there are no dominant traits. Don’t panic. AdWords is a very effective tool for marketing to a struggle without targeting a specific demographic.

Implementing Jobs-to-be-Done in Your Company 

Want to apply this method to your own company and product? Take our Jobs-to-be-Done online course, and we’ll walk you through how to survey customers correctly and how to use the JTBD statistical cluster analysis to find underserved customer segments in your market. The course includes video lessons, detailed examples, JTBD techniques, and custom exercises in your market. You will quickly get insights that you can use to build, market and sell your products.

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The Missing Link Between Sales Frameworks and Closing

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As a head of sales, you’ve likely experimented with numerous frameworks for your sales team. There’s also a good chance that you’ve worn tired of the redundant message across all of them.

“Challenger reps aren’t focused on what they are selling, but what the person they are speaking to is trying to accomplish.” - Challenger Sales

“People buy when they perceive a discrepancy between reality and their desired results.” -Strategic Selling

“When we talk about needs we want to talk about them below the surface. We want needs to reflect the real pains of your buyers, consumers, users, and customers.” - NEAT Selling

Although these frameworks are helpful in creating a philosophy on why customer needs are important, they don’t give sales teams the content or tactical direction on what the customer needs are and how your solution satisfies them better than competitors. So what’s the missing link? How can you get your sales team to understand the customer need and use that to close more deals? Jobs-to-be-Done.

Jobs-to-be-Done is something you may be hearing from your product team. If that’s the case, and you’re wondering if you should care about the JTBD framework they’re using - the answer is a resounding “YES!”

Here’s an overview of how Jobs-to-be-Done helps you fill out the content in your Challenger, Strategic, or NEAT sales pitch and aligns the sales team with the product team.

1. Gain alignment on who the customer really is.
In many markets (especially B2B), the distinction between the Job Beneficiary--the person who benefits from getting the job done--and the Job Executor--the person who does the work to get the job done--is critical to understanding the needs of the person you are talking to. The job executor is part of the solution to getting the job done and new solutions will be developed over time to help the beneficiary get the job done on their own without the current executor. Perhaps your solution puts the Job Executor’s role at risk. Raise the notion that she can now allocate time to a higher order task.

One example of a solution targeting a Job Beneficiary is cloud-based applications. They have enabled companies to reduce or eliminate specialized IT managers (job executors) so that non-technical employees (job beneficiaries) can benefit from secure data use without having to rely on IT.

In medical markets, new medical devices have been developed to allow a patient to obtain a blood sample on their own without a specialized phlebotomist.

Once you have defined your target customer as the Job Beneficiary or Job Executor you can better understand who your solution is really for, target them in your prospecting, and tailor your sales pitch.

2. Define the ultimate customer goal (or job-to-be-done).

Connecting your product to the goal of your customer is a fast way to connect to the value they want to see from your solution. Framing it as a job-to-be-done is helpful because it in ensures that you focus on their goal independent of technology or a given solution.

For example, you don't want to sell AI. You want to sell how AI helps your customer achieve their goal, which actually has nothing to do with AI. They had this goal before AI and the will still have it when the world is hot on some new tech.

What customers want is to be understood and for you to tell them that whatever problem they’re experiencing, whatever goal they want to achieve - your product is going to do what they need it to do. The end.

By getting to the heart of their goal, you’re able to have a more natural, empathic conversation during the sales call. Customers are more likely to open up and discuss their unmet needs. You are there to empathize with their struggle and provide real value.

Tip: Once you’ve discovered the JTBD, share a similar success story. Focus on developing a hero (previous customer) who overcame the same struggle. Highlight how you helped them do it faster, more accurately and worry-free. Include metrics and proof points of how you helped this customer get the job done.

3. Avoid the feature-to-feature comparison trap.
When a product team strives for feature parity with a competitor, they are in the follower's position. If you've ever been on a team that is playing feature catch-up, you know it's like bailing water out of a leaky boat: every time you release a feature and think your work is done, your competition releases something new, racing ahead of you yet again. Microsoft thought they caught up to the iPod by including all of its features in the Zune. Apple launched the iPhone.

Microsoft tried to catch up again with the Windows Phone, but playing catch-up leads to failure.
Feature to feature competitive analysis often fails to identify new competitive threats that can emerge from a different category of products or services. Encyclopedia Britannica thought they were competing with other collections of books and failed to realize how CD-ROMs (and eventually the Internet) could upend their business and lead to their failure.

If a customer asks if you have a particular feature, guide the conversation back to the unmet needs they have and the job they are needing to get done. Keep the conversation grounded in what’s most important to them, and the features will become less important.

4. Create a successful alignment with the product team.
Developing a Jobs-to-be-Done framework for your teams is critical in not only providing your sales team with the right structure to close deals, but it also provides them with the right language to collaborate more productively with the product team.

Sales and product teams have long been on opposing forces within an organization. Sales is unsatisfied with the lack of new features they can sell and product is unsatisfied with the lack of support and quality feedback they are getting. It’s an age-old battle that will continue as long as features stand at the center of product development and selling.

However, when teams are aligned on the Job-to-be-Done, there is more clarity on what provides real value to customers. Creating a Jobs-to-be-Done strategy allows for product teams to build a roadmap that is customer-focused and sales teams a more guided framework on how to sell the product. Instead of going back and forth on customer demands and new features, with JTBD sales teams will be able to validate and the job and product teams will have more data that falls in line with their roadmap.

Jobs-to-be-Done is not a strategy just for product teams. Implementing JTBD across sales and marketing teams allows your entire organization to develop a cohesive language they can share that is customer-focused and memorable. If you want to learn more about how to train your teams on JTBD, check out our services, software, or online training course.

 

Posted by Jay Haynes , 0 comments

What is UX Design?

ux design

The wonderfully thoughtful Peter Merholz, started a valuable discussion on Twitter: What is UX Design? Specifically, he noted that “No one, NO ONE has been able to articulate a meaningful description or definition of “UX Design”. I thought I would contribute to this discussion, so I replied that “UX Design is the process of determining the steps required for a customer to get a job (#jtbd) done. Fewer steps is better, zero (automatic) is best. Speed and accuracy of getting the job done are the criteria to judge the design.”

I wanted to post a longer explanation here (given twitter’s limitations) in order to clarify what I meant and hopefully provide some useful insights for UX designers and product teams.

UX is obviously incredibly important because good UX contributes to customer satisfaction and customer satisfaction drives equity value. The number one goal of every product, marketing and sales team is to create equity value. Teams that don’t create equity value ultimately get fired and companies that don’t create equity value go out of business.

So what is UX Design?

First, let’s distinguish between two different types of customer experience: non-immersive and immersive. In this post, I will be focusing on non-immersive examples.

Immersive experiences are where a user wants to use the product over a period of time. For example, playing video games, watching television or listening to music. In these cases, the user is looking to use the product in-and-of-itself (video games, tv shows, songs). They want to spend time with it.

In non-immersive experiences, which I will focus on here, the user wants the experience to be over with as quickly as possible. For example, getting to a destination on time, optimizing health with diabetes, acquiring customers, and finding tv shows to watch are all goals that people (customers) have. But people don’t want to spend a significant amount of their valuable time doing any of these things. They want to achieve the goal as quickly as possible and get back to their lives.  

A quick logical test proves that this is true. Let’s say you designed a product (and user experience) to make getting to a destination on time slower or a product that made finding a tv show to watch slower. Would your product succeed against the competition? The answer, of course, is no, not likely.

This is also true for accuracy: your customers want to achieve their goal as accurately as possible. For example, let’s say your product was less accurate at getting people to a destination because it didn’t always get the address of the destination correct (as happened with the first version of Apple Maps). Would your customers be satisfied with the product? Again, the answer, is no, not likely.

Your customer’s goal is an example of what is now known as a “job-to-be-done” or JTBD. But for the sake of this discussion, let’s put JTBD and its terminology to the side for now.

The key concept is that your customers have a goal that is independent of your product or its interface. Regardless of what we call this concept (JTBD or otherwise), it explains why companies fail better than any explanation I have ever seen in the 30 years of my career. For example, Kodak thought they were in the “film” market, but “film” is a product. Blackberry thought they were in the “keyboard device” market, but a keyboard device is a product. Britannica thought they were in the “encyclopedia” market, but again, a printed encyclopedia is a product, not a goal. You can test this concept for any historical example and it holds true: customers do not want your product, they want to achieve their goal. This was famously summarized by Theodore Levitt: “customers don’t want a quarter-inch drill, they want a quarter-inch hole.”For non-immersive experiences, there are a few key principles:
  1. Your customers have a goal to achieve that is independent of your product.
  2. Your customers want to achieve their goal as fast as possible.
  3. Your customers want to achieve their goal as accurately as possible.

In addition to these principles, it is also true that every customer goal is complex. This is because to achieve any goal, customers have to take actions and identify variables required to achieve the goal. For example, if you are going to get to a destination on time, you have to know a lot of information (i.e. variables): what are the possible routes, what is the required departure time, what are the traffic conditions on the routes, what is the total travel time, etc. And you have to take actions including making decisions: e.g. determine the departure time, determine the optimal route given the traffic conditions, determine the arrival time for a route, etc. A product that helps customers take actions and make decisions quicker than competitors and that helps identify variables more accurately than competitors will win in the market by helping customers achieve the goal faster and more accurately. This is a key concept, and it is why any user experience (in non-immersive markets) should be focused on speeding up the steps it takes a user to achieve the goal. Your users don’t want to use your product, they want to achieve their goal. So a UX with fewer steps is the best experience.Hopefully this helps clarify why we view UX Design to be the process of determining the steps required for a customer to achieve a goal (i.e. get a job done). Fewer steps is better, zero (automatic) is best. And hopefully it clarifies, why speed and accuracy of achieving the goal are the criteria to judge the design.I hope this is just the beginning of a conversation about UX Design, and I welcome any feedback and refinements that would help UX and product teams create more equity value for their companies.

Posted by Jay Haynes , 2 comments

Add Technology and Stir: Why Companies are Failing at Digital Transformation

digital transformation

Digital transformation has executives salivating at the thought of being innovative, however it’s clear many of them have misunderstood what it requires to execute successfully. Last month, Harvard Business Review published an article titled “Why So Many High-Profile Digital Transformations Fail” that highlighted global organizations such as GE, PG&E, Lego and their failed attempts at implementing a digital transformation.

The authors, Thomas H. Davenport and George Westerman, examined factors that lead digital transformation projects to fail such as a lack of awareness of customer needs and lack of direction. When companies don’t integrate the digital transformation with their product goals and align it with their customers, they lose sight of their end goal and things go off-track… and quickly.

Davenport and Westerman highlight the ongoing failure of large corporations and their shiny object syndrome when it comes to going digital. They couldn't see how to focus the digital changes to their products and operations on delivering value to their customer. It's almost like a digital spray and pray. If they make things digital, success will come, no matter the why or wherefore. Eager to get ahead of competitors, these companies have blitzed through product and operational changes that missed the mark on what’s actually valuable to their customers.

So, what is their end goal? What have these companies lost sight of?

The goal, within the Jobs-to-be-Done methodology, should always be to get your customer's job done better. You need to make sure everyone at your company knows the customer’s job and how to use it to make great decisions. How should they implement digital technology to get the job done better?

Before getting started, you need to understand what you should prioritize, how much you should invest, and what the scope of those projects should be. Here’s how you can use JTBD to create clear goals and alignment across a digital transformation:

 

1. Understand the job you are fulfilling for customers today.
“Your customers do not buy your product; they hire it to get a job done. The struggle with the job causes a purchase,” says Clay Christensen, author of Innovator’s Dilemma and Competing Against Luck. The first step in understanding the job you are fulfilling today is to understand the goal your customer is trying to achieve.

Customers don’t care whether or not your company is digitized; they care about their own lives and their own goals.

Sometimes the goal is obvious. Drivers want to get to a destination on time. Sales people want to acquire customers. Figure out what your customers are trying to do and how you do it for them. Check out our step-by-step guide on how to answer “What is the Job-to-be-Done?”


2. Identify the unmet needs.
When your customer struggles to get the job done, this leads to a purchase. We call this struggle an "unmet customer need." To determine unmet customer needs, we rate the importance and satisfaction of every customer need in the JTBD. Unmet needs in the job are stable, objective, measurable, and precise articulations of customer problems.


3. Figure out what solutions customers hire to get this job done today.

You can accelerate your growth by getting people to switch from their existing means of getting the job done to your product. To get them to switch, you need to understand how well their existing solution gets the job done. If you measure how quickly and accurately the customer can achieve their goal with their current behavior, you know what you have to beat. Your objective is to create a new solution that gets the job done faster and more accurately. Need help? Read this article on Competitive Analysis.


4. Determine if these unmet needs can be addressed with digital innovation.

Digital transformation is a platform that may or may not help you satisfy your customer's unmet needs faster and more accurately than their existing solutions. Now, you need to generate ideas on how to use digital tools to satisfy the needs faster and more accurately. If your project will not get the job done better, you need to be more clever on how you use the digital tech. Or maybe you don't need digital at all…

Companies who enter a digital transformation that is misaligned with a customer’s job will fail. Making things digital won’t make things better. Remember customers aren’t buying your product because it’s digital or not digital - they’re buying it because it’s helping them meet a goal. Or in the case of Jobs-to-be-Done, it’s fulfilling a job they’re hiring you to do.

 

Posted by Jay Haynes , 0 comments

YP & Yahoo! Executive Melissa Burghardt Joins thrv

thrv, LLC (thrv.com), the first and only jobs-to-be-done product management software, today announced that Melissa Burghardt has joined the company as a Growth Partner. For thrv's customers, Melissa brings 20 years of experience driving products & strategy at companies including YP, OpenX, and Yahoo!.

As a Growth Partner, Melissa will partner with businesses in applying Jobs-to-be-Done (JTBD) theory in thrv's software. "I am thrilled to join the thrv team to help businesses accelerate their revenue and profitability growth by leveraging jobs-to-be-done," said Melissa. "Having partnered with thrv as a customer, I was really impressed with the team, as well thrv's methodology and unique software for applying JTBD. I saw first-hand how a product team can use thrv to bring JTBD to life within their own organizations."

"We are extremely excited to have an executive as experienced and intelligent as Melissa join the thrv team," said Jay Haynes, CEO and founder of thrv.

Melissa joins thrv from YP where she was Senior Vice President of Media Products. At YP (previously part of AT&T), Melissa partnered with thrv to drive a Jobs-to-be-Done approach to product strategy with her team. "thrv's structured and quantitative approach to JTBD helped us more deeply understand how small and medium businesses struggle to acquire new customers. Our thrv Growth Partner was instrumental in helping us listen to customers in a new way and frame the market opportunity accordingly, applying our insights consistently via thrv's app."

About Melissa: Prior to thrv, Melissa was responsible for YP's Advertising products for local businesses, including product strategy, product management, product marketing, analytics and yield management. Prior to YP, Melissa was Vice President of Partner Services at OpenX where she was responsible for the company's US publisher relationships. Before that, Melissa spent almost 10 years at Yahoo! in a variety of leadership roles in the US and in Europe. Previous to Yahoo!, Melissa worked in Silicon Valley gaining entrepreneurial experience at a data storage systems start-up and at the management consulting firm Mitchell Madison Group. Melissa holds a Bachelor of Science in Chemical Engineering from the California Institute of Technology.

About thrv: thrv, LLC (thrv.com) is the first and only product management software for enterprises based on the jobs-to-be-done method. thrv provides training, services, and software to companies looking to implement the jobs-to-be-done method in order to accelerate their revenue and profitability growth. thrv's software transforms product management into a customer-centric and metric-driven practice.

About Jobs-To-Be-Done: Jobs-to-be-done (also known as Jobs Theory and JTBD) is a framework popularized by Harvard Business School Professor Clay Christensen based off the concept that customers are not "buying" products, they are "hiring" products to get a job done. As a result, companies and product teams can use JTBD to focus on how customers struggle to get a job done, and design products and services accordingly.

 

Posted by Jay Haynes , 0 comments

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