A Digital Transformation Journey Must Always Center Around Your Customers
“As we understand customers, not as masses to target, but as networks, it really changes our understanding of all the different touch points, the ways we can interact with them, and the changing path to purchase that a customer takes in whatever industry or whatever product or service you offer” — David Rogers
During the course, David Rogers leveraged the lessons learned from the Khan Academy. The founder of Khan Academy began with a request from his niece and nephew to tutor them on their topics from middle school on weekly calls/visits. As a hedge fund manager, he happily accepted, but very early on realized he was struggling with in person/long telephone calls to teach them because of the time commitment. So, he decided to make a video tutorial on the next subject and provide them with a link on YouTube to continue with his commitment. Long story short, they LOVED the videos because they could use them whenever they wanted, pause them, rewind them (the benefits went on and on). From there, he got an unexpected insight when people from all over the world began commenting on his public YouTube video offering tutorials for middle school math. EVERYONE loved the videos. Hence, a new business model was born.
Essentially, once you understand and enable a customer’s true need (Hint 1: which may not be what they say they want at first. Hint 2: start with one high value customer persona and experiment) you could be able to unlock the interconnectivity of those customers’ #networkeffect around the world and discovery net new #businessmodels you hadn’t even imagined.
So, let’s unpack that a little.
Hint 1: One customer’s/user’s true need may not be what they say they want at first.
Some people say give the customers what they want, but that’s not my approach. Our job is to figure out what they’re going to want before they do. I think Henry Ford once said, ‘If I’d ask customers what they wanted, they would’ve told me a faster horse. — Steve Jobs
In the Khan Academy example, the children wanted in person/call-in tutorial lessons. What the founder stumbled upon by sheer necessity was something they didn’t realize they needed more, flexibility in the tutorial (on demand as we now know it). And it’s what Steve Jobs was getting at with his now infamous quote.
From my company’s perspective, I’d ask who are we serving digitally? And as important, why? What do they need that they don’t even know they needed? Maybe it’s to receive our products when/how/where they want it. Maybe (in the time of a global pandemic and socio shift) they want to have everything to make their custom/personalized products at home, on demand? How might we enable that?
Hint 2: Start with one high value customer persona and experiment
Productive Innovation — In today’s digital world, more and more companies are turning to experiments to discover ways to create or improve online experiences. In this issue HBR looks at what it takes to develop the capacity to do large-scale testing and use it to lift firm performance.
Again, in the Khan Academy example, the founder inadvertently experimented with a YouTube video to honor his commitments to tutor his niece and nephew.
Now, you may be thinking back to Steve Job’s quote above and question the hypocrisy of “insights gained from the customer”. The distinction and key point here are, once you’ve uncovered the true need of a customer, then you build out a minimal viable product through rapid feedback loops through higher and higher fidelity (experimentation). Think back to the first iPhone, not much has really changed conceptually, it’s been iterated upon for the past decade to become a worldwide phenomenon. The same thing occurred with Khan Academy, it began as one single YouTube video and has now become a platform enabling free education to the entire world.
From my company’s perspective, I’d ask how do you use this lesson of inadvertent experimentation to uncover new insights about potential business models? If we want to deliver to our consumer/customers digitally, how could first pick a primary persona and see if a new way to deliver our products may be something they never even new they wanted and could potentially be scaled through networks globally?
