Welcome to the next lesson in our online JTBD course. You will learn how to define your market using jobs-to-be-done innovation methods. In this video, we will explain what a market is, types of customer jobs and how these jobs work together in consumer, business and medical markets.
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Define Your Market Transcript
Welcome to the Markets lesson in the thrv Jobs-to-be-done Innovation Course. I am Jay Haynes, the Founder & CEO of thrv.
In business, the market always wins, so correctly defining your market is critical to your success.
In this lesson we will look at how to define your market using jobs-to-be-done innovation methods. If you are on a product, marketing or sales team, your success depends on satisfying customer needs better than competitors in your market. This bring us to the critical question for this lesson.
What Is a Market?
What market are you actually in? Traditional market definitions are fatally flawed because they all use a product as a key variable. For example, the traditional Addressable Market is traditionally defined as all the units sold in a product category times the price per unit, and the Serviceable Market is the units of a product type times the price per unit.
All of these definitions are flawed because all products change over time. If you define your market using a product - for example, the iPod Market - you are trying to hit a moving target. Product defined markets lead directly to failure.
As we saw in an earlier lesson, BlackBerry thought there was a market for keyboard devices and they lost $50 billion in equity value. Britannica thought there was a market for encyclopedias and they lost almost 100% of their sales in just 6 years. Kodak thought there was a market for film and went from $30 billion to bankruptcy. Companies fail when they define their markets based on their products. Product-focus ironically leads your team directly to failure. And today, technology enables products to change at a rapidly accelerating rate. This is why companies fail. Forty percent of the Fortune 500 will no longer exist in just 10 years because their products will be obsolete.
Jobs Theory shows that your customers are not buying your product. They are HIRING your product to get a job done. This means that your customers will fire your product when a new product helps them get their job done faster and more accurately. This is why Apple, Google and Facebook became three of the most valuable companies in history in the exact same markets as Blackberry, Britannica and Kodak.
Customers Just Want To Get Their Job Done
The core idea of defining your market based on your customer’s job-to-be-done dates back to 1960s and Professor Theodore Levitt. His famous Harvard Business article examined why industries repeatedly failed to identify new growth opportunities and competitive threats when products changed. He was famous for saying, “Customers don’t want a quarter-inch drill, they want a quarter-inch hole.”
In other words, your customers don’t want your products, they want to get their job done. This concept is true in any market, including yours. For example, consumers don’t want records, CDs or iPods. I am old enough that I even owned 8-track tapes in the 1970s.
In this market, we all fired our old products, not because we wanted to get rid of our record collections but because the job is to create a mood with music. We all switched to new products that get this job done faster and more accurately. This happens in every market because your customer’s job is your true market.
In 2006 Microsoft made the fatal mistake of thinking there was a huge iPod market. With all their enormous resources they created an iPod competitor called the Zune, which they launched right when the iPod was becoming obsolete and it sales were falling off a cliff.
Don’t make this same mistake!
Products change but your customer’s job-to-be-done is a stable target for your team to hit. This is an important concept to remember. Your market opportunity might be bigger than you think, if you define your market using your customer’s job. We will look at market sizing in the next lesson.
We have seen how you can define your market using your customer’s job with examples in consumer markets. But the idea that your customer’s are not buying your product, they are hiring your product to get a job done, is true in business markets as well.
For example, CIOs don’t want block chain or WEP, which are product technologies. They want to obtain insights from data, which is a job-to-be-done. Similarly, Salespeople don’t want CRM software, they want to acquire customers. This is their job to be done. It is their goal, independent of the products they use.
And Jobs Theory works in medical markets as well. As we saw in an earlier lesson, patients don’t want syringes, they want to obtain a blood sample to diagnose their health. This is a medical job-to-be-done. Because products always change, very soon, you will likely never have to have another needle painfully inserted into your arm to obtain a blood sample. Similarly, surgeons don’t want stents or angioplasty balloons, which are medical products They want to restore artery blood flood. This is another job-to-be-done.
You should redefine your market using your customer’s job.
Let’s look at how you can identify and define your customer’s job-to-be-done - in other words, your market. How do you even know what your customer’s job even is?
3 Types of Customer Jobs
It is important for your team to identify the three different types of customer jobs in your market.
The first type of job is the customer’s functional job. This is the main goal customers are trying to achieve independent of any products or solutions they might be using today.
The second type of jobs are emotional jobs. Customers are, of course, real people with real human emotions. Emotional jobs are personal: how customers want to feel about themselves. And social. Social jobs are how customers want to be perceived by others.
And your customer’s have consumption jobs. Consumption jobs relate to using a solution to get a functional job done. Consumption jobs include interfacing with a product, learning to use a product, purchasing it, maintaining it and repairing it.
All three types of jobs are important to analyze because helping your customer get these jobs done better than your competitors is what creates the best customer experience with your product.
Let’s look at some examples of how these jobs work together in consumer, business and medical markets.
In a consumer market, new parents need to get a baby to sleep through the night. This is a functional job. As new parents try to get a baby to sleep through the night, they feel emotions, including feeling anxious about being a good parent. Avoiding anxiety is an emotional job. And parents need to purchase solutions to get a baby to sleep through the night like swaddle blankets, bedding, and nighttime diapers.
Your goal as a product, marketing, and sales team is to satisfy unmet needs in all three types of your customer’s jobs. We will explain unmet needs in much more detail in another lesson.
Let’s look at a few more examples of function, emotion, and consumption. As we saw in a previous lesson, the JTBD in this market is to get to a destination on time. This is the functional job that defines the market. As people execute this job, they want to avoid feeling anxious about being perceived as unprofessional by being late to a meeting.
A consumption job in this market is to interface with a product while traveling. If your customer cannot easily interface with your product, they won’t be able to get their functional job done.
Business markets have functional, emotional and consumption jobs as well. As we saw before, salespeople need to acquire new customers. This is the functional job, the goal salespeople need to achieve. Salespeople have emotional jobs, including being perceived as valuable to their team. And they have consumption jobs including maintaining current prospect information.
The function-emotion-consumption pattern works in medical markets as well. As we saw, patients need to obtain a blood sample. This is a functional job in a medical market.
Patients want to reduce their anxiety about the procedure, which is an emotional job.
And patients may have to learn-to-use a new medical device like a micro needle array. This is a consumption job related to using a product.
All three job types are important to analyze because they determine your customer’s experience with your product. But defining your customer’s functional job correctly is critical because your customer’s functional job is your market.
Let’s look at how you can identify and define your customer’s functional job.
Defining Your Customer's Functional Job
Defining your customer’s job at the right level of abstraction is critical to ensuring that the theory is useful. Companies often struggle to define what their customer’s job even is. A functional job has three elements:
First, it is a goal that your customer is trying to achieve. Remember, a job and your market is not your job, it is your customer’s job. It is your customer’s goal and the problem they need you to solve.
Second, a functional job has an action verb and an object.
And third, a job cannot contain any mention of a solution, a product, a service or a technology.
Let’s look at a consumer example.
A consumer might say, “I need to play MP3s.” Is this a job? Is it therefore a market?
Let’s use our three criteria to find out.
First, is this a goal? Yes, this is something consumers want to do.
Second, does it have an action verb? Yes it does - “play.”
And does the action verb have an object? Yes it does - “MP3s.” So is this a job? Is it a market?
This is not a functional job because it contains a solution: MP3s. MP3s are a product format, which makes this an unstable definition of a market. And since formats, like all technologies and products, change over time, “play MP3s” is not a good definition of a market. As we saw before, the job is to create a mood with music. This is a stable definition because people have been creating a mood with music forever.
Let’s look at another example in a business market. Businesses use software to run their companies, and they need to “install software.” Is this a JTBD? Is this a market? Let’s use our tests.
Businesses do install enterprise software, so it is a goal.
It also has an action verb and an object.
However, note that “install” is a consumption job. If you could achieve a goal without installing software, would you? Of course. Not long ago, installing business software used to be a large business for service firms, but today, cloud and SaaS applications are eliminating the need to install on-premise enterprise software.
Over time, new products emerge to eliminate or reduce the need to execute consumption jobs in order to use the product. This make sense because your customers don’t buy your product to interface with it or to learn to use it or install it. They buy your product to get their functional job done. As a result, the consumption job is not your market.
In this example, what about the word “software”? Software is an object, and it is a solution, but it is also a big enough platform that it is stable, like an aircraft. We will discuss platforms in more detail in later lessons.
Finally, Let’s look at an example of a medical job-to-be-done.
In a medical market, a patient, doctor, or nurse might say they need to “Monitor blood pressure.” Is this a job, is it a market? Again, Let’s use our tests.
Is it a customer goal? Yes, patients need to monitor their blood pressure.
It also has an action verb and an object.
And it has no solution.
But why do patients want to monitor their blood pressure? Is their end goal just to monitor?
It is important to analyze the level of abstraction of any job statement. Monitoring is an example of a step in achieving a higher-level goal. While there may be an opportunity in the short-term to provide a better product that does a better job of monitoring blood pressure, monitoring is not the end goal for a patient.
A patient, of course, monitors their blood pressure in order to optimize their health. If you have a health condition, blood pressure can be a key input. But the goal, therefore the job, and thus the market, is to optimize health. With higher level jobs like "optimize health", you can be more specific about your market definition.
For example, a patient who has diabetes needs to optimize their health with diabetes, so this is a specific job and therefore a market based on a health condition.
Different health conditions represent different markets because they are specific goals that different patients need to achieve, independent of any products, services, drugs or therapies they may use.
Level of Abstraction
You can specify level of abstraction for many types of jobs.
For example, parents need to instill a behavior in a child. But like health conditions, there are many types of behaviors, each of which defines a specific market.
For example, parents need to instill behaviors in their children to prevent anger, to learn music, or to resolve a dispute.
When defining your customers functional job, use these three tests, and use action verbs like these to help you identify your customer’s goals. You can refer back to this list when working with your team to define your market based on your customer’s job.
How to Identify JTBD
When identifying your customer’s job, you should conduct customer interviews, and analyze research to identify your customer’s goals independent of any solutions. Apply the three rules for jobs to ensure you have a well-defined market.
Defining your market using your customer’s job is just the beginning, but it has profound implications for everything your product, marketing, and sales teams do for your company.
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In the next lesson, you will learn how to size your market using your customer's job. This is critically important, since your revenue and profits are a function of the size of your market.
Visit us at thrv.com to get our free how-to guides and try our jobs-to-be-done software for free.