As someone who has worked with/in Go-To-Market (GTM) functions for over a decade, whether in Sales, Marketing, or Product, I want to relate what I’ve learned from the Disruptive Strategy course I took at HBS Online last year to GTM. The course didn’t have anything to do with digital. Instead, it explained why and how disruption occurs and what organizations can do about it. It gave me a new lens on how businesses approach product strategy and go-to-market. So, in this three-part series, I would like to share my top three takeaways in a three-part series.
The Three-Part Series Outline:
Each part represents a lesson I took away, so strap your seat belt as you’re in for a ride.
- Lesson #1: Make “Customer Jobs” your North Star
- Lesson #2: Many innovations fail because of the wrong resources, processes, and profit formulas
- Lesson #3: Strategy is temporary. When you find a winning strategy, you find one that works temporarily
We all know what happened to Blockbuster and Blackberry. Will taxis experience the same fate?
Blockbuster and Blackberry had moments of glory but have been wiped out. At some point, Blockbuster had 9,000 stores worldwide with $6B in revenue. But eight years after that peak, the company went bankrupt, and Netflix, which was late to the party, slowly took market share and now is valued at $267B. How could something so big go bust? If it happened to Blockbuster, can’t this happen to Netflix, too?
Despite the obvious disruption of taxis by Uber and Lyft, I don’t believe taxis will be wiped out entirely. The answer lies in the “Customer jobs to be done” concept, the lesson we will explore in this post.
Clayton Christen, the course professor who popularised the Disruptive Innovation theory, says customers don’t really buy products. They “hire” them to get a job done. Let’s repeat that.
Customers don’t really buy products. They “hire” them to get a job done.
Clayton Christensen, Disruptive Strategy, Harvard Business School Online
Pause for a minute and reflect on the last purchase you made that’s over $100. What job did you need to accomplish that caused you to buy the product/service?
You bought it, not necessarily because of who you are, but because you had a job you needed to get done. There’s a difference, and we will get back to this later.
A “customer job” is a problem a customer is trying to solve.
Customer job statements often start with “Help me do this…” or “Help me avoid that…”. Some examples are, “Help me get to the airport with my luggage right now” or “Help me unwind after a long day at work”.
Jobs generally have two dimensions:
The point is that when you shift your perspective to “Customer Jobs to be Done,” you think about what causes customers to “hire” your product instead of analysing “who” they are (i.e. age, gender, location, etc). Instead, you think of functional jobs and emotions.
Products and technology come and go, but jobs persist over time.
- From Blockbuster to Netflix, the job of getting entertained hasn’t changed. Netflix made this job easier, however. There is no need to visit physical stores, no more late fees, and made navigation of content easier by surfacing content recommendations. There is a clear winner.
- From standard taxis to Uber, the job of getting to a destination hasn’t changed. Do I think taxis will be wiped out completely? I don’t think so. There are metropolitan cities filled with cabs, where one can get a cab quickly. But if I’m not in a rush and would rather know the price upfront, I get an Uber. Again, it comes back to the “customer job”. Time over price? Or price over time?
- I urge you to watch the new Blackberry film. Knowing this theory, try to find out which job Apple succeeded when Blackberry was stubbornly in denial.
This now takes us to Key Lesson #1 from Disruptive Strategy.
Make “Customer jobs” your North Star.
Whether you are in Sales, Product, or Marketing, focusing on “customer jobs” creates opportunities for improvement.
If you are in Marketing, I think of three opportunities:
Content
Does our content clearly explain how you can help them with their jobs? I see a lot of brands still talk about themselves. “We are this and that” and miss out on meeting the customers using their language and the jobs they need to do.
SEGMENTS
Do you segment your users based on the varying “jobs to be done” or still use the traditional demographics approach? In a networking event, a rep discovered I was their customer who purchased their streaming service and broadband bundle. The rep was so surprised because I am not in the demographic that buys that bundle! No sh*t.
PERSONALIZATION
Do you offer a personalized experience based on the varying jobs, including pre and post-purchase? Personalisation today is still often based on surface-level attributes: age, gender, and location. We need to understand their jobs so the buying experience can be made easier, and continue to do so as a customer to create loyal customers!
Personalization delivered to “Trapped Travelers”, a case study
A digital team in the airline industry noticed a cohort of website users with a high “flight search rate” but a low “session conversion rate”. This means these users are stuck on the flight search results page and aren’t converting/making a flight purchase.
So, they created a segment called “Trapped Travellers” based on a hypothesis that these users are still in the research phase, comparing prices. They thought, “What can we do to help these customers in their research phase?” Notice this customer segmentation and personalisation strategy is based on a job to be done, not demographics or customer attributes.
They came up with a give-to-get approach: offer a discount to the trapped traveller in exchange for signing up. Since then, they have seen an increase in customer sign-ups. They focused on the job, not the user identity!
Here are ideas for discovering customer jobs to be done:
This is a fantastic opportunity for you to take back to your organization. According to the Disruptive Innovation theory, companies integrated around a “job” can achieve market differentiation and avoid disruption.
Companies integrated around a “job” can achieve market differentiation and avoid disruption.
Clayton Christensen, Disruptive Strategy, HBS Online
Conclusion
Disruption favours those who innovate based on the “customer jobs to be done” and those who constantly find ways to help their customers accomplish those jobs. New technology alone does not disrupt. It’s those organizations that have found ways to apply emerging technologies to their business model in ways that benefit their business and customers who will disrupt.
You may be asking, couldn’t Blockbuster have offered Streaming Services when that technology was made available? In the 2nd part of this series, I will cover the importance of finding the right resources, processes, and profit formulas when taking on disruptive innovation projections. Hint: a business cannot disrupt itself. It must set up a new business unit with the unique resources, processes, and profit formulas required to reach profitability and growth, which are most likely very different from the core business.
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