What We Overlook About How Customers Make Decisions
Some of the world’s top management thinkers have embraced using Jobs to be Done to understand why customers buy what they buy. As the theory goes, customers “hire” products or services because they have important “jobs” that they’re looking to get done in their lives. When customers struggle to get those jobs done, they’ll look for something new. If the new product is alluring enough — keeping in mind that buying and using a new solution may come with a number of costs — customers will make the switch.
The basic premise is simple enough, and Jobs-based thinking has led to a number of breakthrough innovations. Customer decision-making, however, is quite complex. Understanding the jobs that customers are trying to get done is an essential first step, but there are many other aspects of Jobs to be Done thinking that are important for understanding why customers will look for new products and what they will choose to get a job done. To more fully understand how customers make decisions about what to buy, we can look at three stages of the customer’s thought process — considering leaving an old solution, wrestling with the decision to hire a new solution, and choosing among potential new solutions.
Deciding to fire an existing solution
Just because a new product hits the market, it doesn’t mean that customers are going to abandon whatever they were using before — even if the new solution is objectively better. Sometimes there is a sudden trigger that causes customers to make a change. They may buy a new car because their old one broke down. In a B2B context, perhaps there’s a budget freeze or a new person taking control of the vendor evaluation process. Other times, the decision is more of a slow build. Maybe the cable company has been steadily increasing its fees, or the most recent billing error is the final straw. Both contexts — the sudden trigger and the slow build — create opportunity.
In the case of the sudden trigger, the decision to fire a product is the result of a major change in circumstances for the customer. I recently talked to someone who was looking to purchase an Audi. His demographic profile — male, architect, late 30s — didn’t explain why he was switching from a brand he’d been loyal to for decades. Nor did his obvious jobs to be done — getting to work safely, staying entertained on the way, getting groceries home, and so on. Digging further, I learned he’d recently been made a partner at his firm, and his jobs around showing off his success and rewarding himself suddenly soared in importance. Going beyond the job to understand the context of customers’ lives helps reveal the triggers that lead people to fire their existing products.
Sometimes the decision to fire a product is more of a slow build. A customer’s frustration over time eventually forces a change. This might be because certain pain points recur frequently. The more often customers have to deal with pain points, the more likely they are to look for an alternative. It can also be because the frustration resonates on an emotional level. In learning more about customers’ lives, it’s important to explore broadly. Pain points may not always be functional or obvious. Don’t just ask your customers what bothers them. Observe.
The forces that push back against change
Even as customers decide to fire an old solution, the pull of inertia is strong. There are forces constantly pushing back against change. Customers tend to be attached to their current ways of doing things, even when they’re riddled with pain points. Mobile banking is often far more convenient than visiting a branch, and getting customers to switch could save banks a fortune. According to a recent survey, however, 87% of respondents had visited a bank and spoken with a teller in the prior 12 months, while only 35% had used mobile banking. The less behavior change that’s required, the faster a new product is likely to take off.
In addition to requiring little behavior change, companies should also make it as easy as possible for customers to learn about and try their new offerings. They need to dispel the myths that are keeping people from using their new product, and give customers a sense of the tangible value they’re adding. T-Mobile has long been on the defensive as Verizon has touted the superiority of its network and its lack of dropped calls. Recently, however, T-Mobile has made it cheap and low-risk for customers to switch by offering to buy out early termination fees from other carriers, eliminating overage charges, and getting rid of the annual contract model. At the same time, the company’s T-Mobile Tuesdays offer weekly gifts to customers — such as free movies or food — so they clearly see the value they’re getting.
Evaluating the new solutions that you may hire
Once customers have decided to make a switch, there can be a lot of competition. As I’ve said, there’s inertia. There are also traditional competitors with similar offerings. Beyond that, there may even be competition from completely different industries — others offering new ways to satisfy the same jobs. For this reason, it’s important to understand how customers will evaluate new ways of getting a job done. While customers will often give you rational-sounding reasons for why they might choose one product over another, smart companies will push deeper. They’ll force customers to make tradeoffs and identify the extent to which they value specific attributes. In doing so, they’ll be able to create a concrete description of what a new solution needs to include, as well as what can be cut.
Getting customers to love your new offering can be hard. While helping them get a job done is an essential first step, there’s more to it than that. Companies that consistently launch successful new products dig deeply to understand what’s really going on in customers’ lives, and they make it as easy as possible to switch to a new solution.
Story by Dave Farber
Learn more about Jobs to be Done thinking in practice at www.newmarketsadvisors.com!