Clay Christensen's Milkshake Marketing
| Published: | February 14, 2011 |
| Author: | Carmen Nobel |
Executive Summary:
About 95 percent of new products fail. The problem often is that their creators are using an ineffective market segmentation mechanism, according to HBS professor Clayton Christensen. It's time for companies to look at products the way customers do: as a way to get a job done. Key concepts include:
- About 95 percent of new products fail in the marketplace. The problem, in part, is that most companies segment their markets according to product category or customer demographics, neither of which is very effective.
- Products are more likely to succeed if companies segment their markets according to "jobs-to-be-done"--addressing the basic problem a customer is facing and providing a product that can deliver the necessary result. Each job has functional, emotional, and social dimensions.
- Companies can also apply the jobs-to-be-done approach to product branding. A "purpose brand" clearly reflects the job that a product does, such as Kodak's FunSaver brand of single-use cameras, which performs the "job" of preserving good memories.
About Faculty in this Article:
Clayton M. Christensen is the Robert and Jane Cizik Professor of Business Administration at Harvard Business School.
When planning new products, companies often start by segmenting their markets and positioning their merchandise accordingly. This segmentation involves either dividing the market into product categories, such as function or price, or dividing the customer base into target demographics, such as age, gender, education, or income level.
Unfortunately, neither way works very well, according to Harvard Business School professor Clayton Christensen, who notes that each year 30,000 new consumer products are launched—and 95 percent of them fail.
"The jobs-to-be-done point of view causes you to crawl into the skin of your customer and go with her as she goes about her day, always asking the question as she does something: Why did she do it that way?"
The problem is that consumers usually don't go about their shopping by conforming to particular segments. Rather, they take life as it comes. And when faced with a job that needs doing, they essentially "hire" a product to do that job. To that end, Christensen suggests that companies start segmenting their markets according to "jobs-to-be-done." It's a concept that he has been honing with several colleagues for more than a decade.
"The fact that you're 18 to 35 years old with a college degree does not cause you to buy a product," Christensen says. "It may be correlated with the decision, but it doesn't cause it. We developed this idea because we wanted to understand what causes us to buy a product, not what's correlated with it. We realized that the causal mechanism behind a purchase is, 'Oh, I've got a job to be done.' And it turns out that it's really effective in allowing a company to build products that people want to buy."
Christensen, who is planning to publish a book on the subject of jobs-to-be-done marketing, explains that there's an important difference between determining a product's function and its job. "Looking at the market from the function of a product really originates from your competitors or your own employees deciding what you need," he says. "Whereas the jobs-to-be-done point of view causes you to crawl into the skin of your customer and go with her as she goes about her day, always asking the question as she does something: Why did she do it that way?"
Hiring a milkshake
In his MBA course, Christensen shares the story of a fast-food restaurant chain that wanted to improve its milkshake sales. The company started by segmenting its market both by product (milkshakes) and by demographics (a marketer's profile of a typical milkshake drinker). Next, the marketing department asked people who fit the demographic to list the characteristics of an ideal milkshake (thick, thin, chunky, smooth, fruity, chocolaty, etc.). The would-be customers answered as honestly as they could, and the company responded to the feedback. But alas, milkshake sales did not improve.
The company then enlisted the help of one of Christensen's fellow researchers, who approached the situation by trying to deduce the "job" that customers were "hiring" a milkshake to do. First, he spent a full day in one of the chain's restaurants, carefully documenting who was buying milkshakes, when they bought them, and whether they drank them on the premises. He discovered that 40 percent of the milkshakes were purchased first thing in the morning, by commuters who ordered them to go.
The next morning, he returned to the restaurant and interviewed customers who left with milkshake in hand, asking them what job they had hired the milkshake to do. Christensen details the findings in a recent teaching note, "Integrating Around the Job to be Done."
"Most of them, it turned out, bought [the milkshake] to do a similar job," he writes. "They faced a long, boring commute and needed something to keep that extra hand busy and to make the commute more interesting. They weren't yet hungry, but knew that they'd be hungry by 10 a.m.; they wanted to consume something now that would stave off hunger until noon. And they faced constraints: They were in a hurry, they were wearing work clothes, and they had (at most) one free hand."
The milkshake was hired in lieu of a bagel or doughnut because it was relatively tidy and appetite-quenching, and because trying to suck a thick liquid through a thin straw gave customers something to do with their boring commute. Understanding the job to be done, the company could then respond by creating a morning milkshake that was even thicker (to last through a long commute) and more interesting (with chunks of fruit) than its predecessor. The chain could also respond to a separate job that customers needed milkshakes to do: serve as a special treat for young children—without making the parents wait a half hour as the children tried to work the milkshake through a straw. In that case, a different, thinner milkshake was in order.
Proven success and purpose branding
Several major companies that have succeeded with a jobs-to-be-done mechanism: FedEx, for example, fulfills the job of getting a package from here to there as fast as possible. Disney does the job of providing warm, safe, fantasy vacations for families. OnStar provides peace of mind.
Procter & Gamble's product success rate rose dramatically when the company started segmenting its markets according to a product's job, Christensen says. He adds that this marketing paradigm comes with the additional benefit of being difficult to rip off. Nobody, for example, has managed to copy IKEA, which helps its customers do the job of furnishing an apartment right now.
Christensen also cites the importance of "purpose branding"—building an entire brand around a particular job-to-be-done. Quite simply, purpose branding involves naming the product after the purpose it serves.
Kodak, for example, has seen great success with its FunSaver brand of single-use cameras, which performs the job of preserving fun memories. Milwaukee Electric Tool Corp. has cornered the market on reciprocating saws with its trademarked Sawzall, which does the job of helping consumers safely saw through pretty much anything. Its Hole-Hawg drills, which make big holes between studs and joists, are also quite popular. The company's other tools, which rely on the Milwaukee brand, are not nearly as celebrated.
"The word 'Milwaukee' doesn't give you any market whatsoever," Christensen says.
So, if jobs-to-be-done market segmentation is so effective, why aren't more companies designing their products accordingly? For one thing, future product planning usually involves analyzing existing data, and most existing data is organized by customer demographics or product category.
"I've got a list of mistakes that God made in creating the world, and one of them is, dang it, he only made data available about the past!" Christensen says. "All the data is organized by product category or customer category because that's easy to get. To go out and get data about a job is really hard. But there are a lot of people who hire consultants to tell them how big the market is. And because the data is organized in the wrong way, you start to believe that's how the market should be organized."
Furthermore, it's difficult for product developers to break the mold when many of their customers organize their store shelves around traditional marketing metrics. Christensen gives the example of a company that developed a novel tool designed to help carpenters with the daunting task of installing a door in a doorframe, a job that usually took several tools to do. But a major home goods store refused to sell the tool because its shelves were organized by product category—and there was no shelf in the store dedicated to the singular job of hanging a door.
"Most organizations are already organized around product categories or customer categories," Christensen says, "and therefore people only see opportunities within this little frame that they've stuck you in. So you have to think inside of a category as opposed to getting out. You've just got to make the decision to divorce yourself from the constraints that are arbitrarily created by the design of the old org chart." 
Carmen Nobel is senior editor of HBS Working Knowledge.
Sign Up for Our Newsletter
Receive the HBS Working Knowledge e-mail newsletter each week—new business research and ideas delivered to your inbox.
Reader Comments:
That's an interesting insight that we have also seen internally within companies. For example, traditional IT departments often define themselves in terms of asset categories (e.g. mainframes, desktops, applications) or customer segment served (e.g. manufacturing dept, finance dept). More progressive IT organizations are beginning to define and structure themselves by the job they do or the service they provide (e.g. order processing, profitability reporting)
An extension of the features / benefits issue in marketing. Many people and companies think products and services sell because of their features, but features (more accurately lack thereof) are a disqualifier. Things sell because of benefits, and they are not always obvious from the custoemrs point of view. Makes the point of never assume you know what a customer is thinking - identify, identify, identify.
This article makes it sound like Christensen has invented a brand new way of looking at business. This "jobs-to-be-done" approach is as old as the hills. I've been using it since the 1980s. I wrote a chapter about this concept in a book back in the 1990s (it was chapter four; you can download a free copy of the book at http://www.box.net/shared/4bpnqdoppd).
The only difference is that back then, we called it "solution selling." A solution is nothing more than the best answer for the job you want to get done.
Oh, by the way, I've also mentioned this concept numerous times in my blog over the years (http://planninga-from-nanninga.blogspot.com). Just search my blog on the term "solutions."
Yes, this is a great concept. I love it so much, I've been using it for many decades. But don't try to convince people that it is new.
Yes. In other words, companies should sell the service(/s) that the product offers.
When the marketing goal is rooted in how to sell the service(/s), companies start organizing based on service a.k.a. jobs-to-be-done.
Come on people. Really!
Let's take a good look at what happens out here in the real world.
Analysis and planning are not by any means the reason for such high failure rates. Every VC knows this. So do those of us who have taught Entrepreneurial Management at the School.
The real reason is that such a high percentage most new products (inside and outside companies) fail is that they do not meet a real or perceived need. Stated another way, customers perceive no value in use as the product is presented to them.
Alternatively, a legitimate product may simply be presented in a way that does not represent the highest and best use for a particular class of customers. The Apple iPad, for example, has now established needs in niches and applications the magnitude of which "planners" and analysts at Apple could not have conceived. One of the most interesting and explosive of these is ebook publishing.
I have been on the track for 40 years now. I can say with great authority, the need for the overwhelming majority of new products exists mainly in the minds of those who have invented, conceived, devised or are planning the new product.
The key question is, "Does it work, and who cares." This is a seemingly simple question, but it is actually Zen-like. Think about it, and you will see layer upon layer of issues unfold.
Part of who cares is the distribution system, or who the hell is going to sell the product, and why would they want to do so.
So, one can analyze the market till hell freezes but unless the product connects to value in use among real customers, who see the need and the value in use and who are willing to pay cash money for it, tank here we come.
The fact is that with technology increasingly in the hands of the tribes in the hills, it is ordinary people who create amazing product concepts. Why? Because the products flows from some real use and need. Two excellent examples are the development of the mountain bike and Facebook. The grand daddy of all of them is Netscape. The holy grail of all VC investors is that "Netscape Moment." Federal Express also evolved from Fred Smith's astute observation of the need met by MACV in Vietnam. What enables computer solutions i the first place? People outside of companies have the technology and they put it to use. Pre-press work for digital and conventional publishing is now fragmented in the US and in India on the Macintosh. High fidelity audio and video can be produced by individual artists and producers operating completely outside of any company or organization.
Films at Sundance are a good example.
Then we have Wikipedia. Good bye encyclopedias and, now, the Oxford Dictionary of the English Language. Tell me what kind of planning could cope with these two technologies.
These kinds of developments have basically destroyed the reason for major the existence of publishers and record labels, not to mention retail outlets for books, CDs and records.
You get the point(s).
/John
I love this - - it is back to the future! Dig deep for insights from your customers (and non-customers) and use those insights to build better, more relevant, more resonant, marketing programs. Stop the 'push' and 'deals' and disruption and insulting ad messages. In the words of David Ogilvy (from the 60's), "the consumer is not a moron, she's your wife" (or husband, or neighbor).... Bravo
I think in sophisticated economies preparation of an individual through skills, concepts and understanding that are required for everyday living to achieve maximum satisfaction and utilization of his/ her resources is vital known as consumer education, professor rebukes this point because people in the market system take life as it comes and influenced by mere positive rational choices, i might not need a tutorial for purchasing a book on amazon but mere computer literacy.
But why then are companies subjected to looses in revenue when they segment markets based on product differentials? Proven success and purposeful branding factor postulates case studies where branding on products is done on usefulness purpose it serves.
My lesson from this brilliant work is understanding market segmentation can be a useful strategy in business to deliver its products. In simplest terms, market segmentation with application of marketing techniques to a specific product line (branding) for the advancement of consumer choice often proves to deliver the best possible value of money spent in exchange of the durability, content or life span of product in terms of its quality and nature.
Nicely told and emphasized - 4 P of marketer and corresponding 4 C for Customer First P for marketer is Product and corresponding first C for customer is Customer Solution..yes customer buys product to get solution to his problem..
The critical point for me is that you have to look at and interpret what customers do, not listen to what they say. Few customers would say that they buy a shake to fill the place of a bagel and to give them something to do on the way to work.
The difficult task is the interpretation. Identifying their unconscious drivers should be the primary goal of marketing research.
It does not sound very different to Ted Levitt's "Who is the customer, why does she buy and where does she buy"?
It is nice to know that the old principles hold even if dressed up in a modern analogy.
This is harking back to the basic tenet of marketing - identify the NEED. The terminology is different and calling it `jobs-to-be-done' market segmentation is an application of the "purpose" branding talked about!
Of course it doesn't hurt to be reminded every now and then that it is the "need" we should be catering to and not get lost in the demographics which are but proxy variables to identify the persons that have that "need".
Old wine, new bottle. Tastes good nevertheless!
The fun begins when trying to develop "tweaked"' product attributes for the same brand for different "jobs-to-be-done" segments in multi-segment targeting. Creating a coherent brand image across segments becomes a challenge.
I concur with Gerald Nanninga: this is an interesting way of presenting an old approach.
I recall very early in my advertising career a boss telling me the cliche, "You're not selling the drill, you're selling the hole."
That said, I commend Prof. Christensen for helping to sell more people on the concept.
You've positioned this view of reality in terms most businesses have not previously considered. The open-minded executives and entrepreneurs will get it and seize the competitive advantage of this way of thinking.
In my book, Competitive Intelligence Advantage, I discuss this perspective slightly differently. My focus is uncovering today's reality to give the customer, B2B or B2C, what they want which is far more likely to result in sales.
It's not magic; it's paying attention or conducting due diligence (synonym for competitive intelligence) to understand what's changing and what annoys customers.
One of my favorite examples is Cosmo magazine in the UK who heard that women couldn't easily fit their publication into their handbags. So it got wet when it rained (often) or they needed to carry another bag (not desirable.)
They did a test - shrink the size but keep all the articles and print ads....just smaller font (but then not too many 40+ were their customers.)
When Glamour mag saw it, they labeled it a "pygmy" issue and mocked it. Four months later, Cosmo was #1 in sales in their category. And a few months later, Glamour offered their own pygmy version.
Christensen's notion is elegant because of its sheer simplicity. And it works. Why? Because consumers -- either B2C or the ends users of B2B companies -- are at the beginning and end of the day humans. Humans, as a species, have certain core needs. Recall Maslow, et al. The notion of a product or service fulfilling a 'job' is really about meeting a core underlying human-level need. Not a feature or functionality but the likes of Xbox fulfilling the need of a human to be entertained, and with its IP connectivity to be affiliated with other humans. Or a mini-van fulfilling the need of a family to be transported, with safety and utility. Christensen reminds us its ALL about the user -- the human -- not the data, the technology, or the endless exercises of marketing segmentation that is nothing more than an artificial slice of the world.
Since every product has an expected life cycle, or finite useful life, and every product is somewhat unique from other product. We therefor; can manage it as a project.
According to Standish Group Chaos report, the #1 & #2 reasons why projects fail are: 1. Incomplete Requirement 2. Lack of User Involvement
This also applies to product development.
"... only made data available about the past"
It is for this reason I suggest we ought to expedite data delivery and collections. An example of this could be in medicine. Think if every prescription allowed the patient to submit data for delivery. The data could be delivered to a centralized venue via various media formats including website and telephonic submittable styles. The telephone service could resemble the 'SayNow' service used in Egypt. The cost of the collection of the data could be offset by selling the data to licensed researchers, like a research journal. This would allow for greater timeliness in data collections, advance innovation in research, bio-informatics, help the industry, comfort patients, and generally be beneficial to society at large. Thank you for the excellent story.
Reminds me of the classic Life Cereal case: the real buyers were teenagers after school. They focused on that and won. Ditto for milkshakes. Who would believe? Clayton's gang checked the facts out. A big wow.
I agree with the author's point regarding purpose or job-to-be-done branding and naming the product after the purpose it serves. At a recent INTA (International Trademark Association) speaking engagement I pointed out - "The goal of effective verbal brand naming is to choose a product name that reflects and fits the customer's needs so precisely that the name sells the product."
Clay and Carmen
Great material. As I was reading your article, I kept thinking of a comment Len Schlesinger made several years ago. If my memory serves me correctly he said something like this.
"A few of my colleagues and I decided to open up a soup and sandwich place near campus to put our theories to the test. During one of our brainstorming sessions about the menu, someone suggested, "What if we offered gazpacho?" Since our clientele was composed of Ivy league students with a developed palette, we all thought, "Great idea. No one else is doing that around here. It'll be unique."
So we put it on the menu and guess what? It failed miserably. For some unknown reason students in Boston during the winter don't want to buy cold soup."
He then concluded with one of my favorite lines of all-time. "What we learned from that experience is that executives talking to other executives about what customers want is ridiculous."
Seems to fit perfectly with your article. Loved the research on the Milkshake! Thanks!
Bruce http://www.BecauseGrowthMatters.com
Apple's success lies in addressing the needs of 'Prosumers' (read Proactive consumers). The products are new and user friendly and Apple leaves it open to the Prosumers the way they want to get the job done.
Enjoyed the perspective. To shake things up I sometimes ask people to imagine what the buying/selling dynamics would look like if there were just one customer left on earth. http://bit.ly/d7aKeK
If the products/services don't solve a need, nothing else really matters... including positioning and segmentation!
Nice article which does capture the essence of offering a proposition/solution.
However for selling successfully, there are other aspect that also play an important role. For instance the buying behavior is a dimension that I am missing in the 'job-to-be-done' approach. Also deciding on the pricing is, especially for not revolutionary new products, a very important element which also entails taking into account substitute products/services.
All in all I think that the approach as described in the article (and already in his books on disruptive innovations by the way) is a good start for creating a success but there is more to it.
Understanding the need/problem to be solved is absolutely key for new products.
In CPG, alignment of sales force (owned or contracted) compensation systems is important too. Many are the products that do not get a fair trial because the pay systems are mostly based on volume, with little or no financial recognition for adequate shelf presence for new products. (There are now ways to audit for that too, relatively inexpensively.)
We marketers certainly have approached the question of "what's the benefit" with various expressions: Y&R's "what is the problem the consumer is trying to solve", and McKinsey's needs-based segmentation (not that those two organizations are unique in using those expressions). Where Prof Christensen should be congratulating himself is on his and his colleagues' skill in getting the precise answers to those questions. Many marketers do not learn anything new from focus groups and one on ones. Prof Christensen has illustrated that skill in observing consumers in action rather than sitting in a focus group facility and then digging more deeply into the specifics of what choices they are really making and why, make the difference between a rich, needs-based product strategy and a superficial, non-competitive one.
Very instructive and mind set changing
The insight of jobs-to-be-done is old had. There's nothing new about it. Twenty five years ago, Ames and Hlavacek-- industrial marketers, wrote extensively about segmentation and one of the preferred methods was how the product was applied. Application based segmentation or how the product is used is a common method of breaking apart markets for insight. Any B2B marketer worth their salt knows this. Perhaps Christensen and Cizik should name their insight "rediscovery" of the jobs-to-be-done approach. As for the failure rate of new products, the common reason for failure is no concept and hence existence of a valid product launch process. Segmentation for new products, in our consulting work, while important, is often not a game changer. If one doesn't have a valid product development process, the products almost never succeed.
Aren't professors, at even leading colleges, siloed into specific departments just as your hardware store example?
Intriguing comments by all. It's great to know that some people buy milkshakes to "eat" breakfast in the car.
Combining emic (what people say) and etic (what people do) can be quite effective in determining what is actually going on in the marketplace.
So now that you know about the "real" uses of milkshakes, what are you going to do? Will you exploit this by changing the product's values? What's the backlash? Maybe the reason why users did not share their car stories was due embarrassment. Would you want to tell your spouse, office buddy, etc., that you had breakfast at home and just ate another one in the car out of boredom? And on top of that, it was a milkshake?
How do you tell you ad agency to create a new campaign? Where does your media agency buy against this insight?
Just some thoughts to share.
Also the 95% of failures. What does this mean? No longer available to purchase in any form and in what time period. A month? A year? A decade?
Clay is right, as are the commenters, on understanding the jobs to be done by a product or a service as being critical to the success of the product. There's an element of 'old wine in new bottles', but we all need to reminded of some truisms periodically, because we forget them. We use the 'jobs to be done approach in our course A02 on validating a business idea. We just had an example of one of my friends use A02 approaches to launch a, differentiated new business in a fairly crowded market segment, too.
Loved it, for me what i learn most from this is marketing strategy, and in specific what NOT to do... 1. segment market by product 2. segment market by demographics 3. Maybe not a good direction, since it mostly don't have real impact on sales or revenues
However, having a deep understanding of your customers, and what your product compete with... then you could better understand your value in the world.
Great post! thanks for sharing. Sharel
Old wine in a new bottle! And good to drink anew!
great new idea. In a market like India which is growing at a super fast speed, copying each other is the norm of the day. there are of course a few truly innovative companies, but in most cases we end up seeing may be an innovative communication platform, rather than an innovative product / service offering. one reason would be that market research is still not taken as seriously as it should be.
Good insights by Prof. Christensen. It's a shame that in this day and age this is still considered to be a new and important business insight.
Drucker and Levitt were writing that business begins with the needs of customers half a century ago. I guess the purpose of marketing still isn't taught properly in B-schools.
Every ten years someone renews this topic, but nobody reads Tom Peters or Vincent Barabba anymore either. Good luck to Prof. Christensen in his effort to renew The Marketing Concept.
Providing products and services to meet the REAL, not the PERCEIVED need of end users is not revolutionary. What is enlightening is the reminder that SENIOR management needs to get in the trenches with the team delivering the ultimate product to disover why people buy or do not buy. Jack Trout and Al Ries covered this repeatedly in their books starting with Positioning 30 years ago. Don't research the theory, stand in the drive through lane and discover the REALITY. It is not at HQ.
I would very much agree that addressing the value/benefits to the consumer is crucial and in Prof Christensen terms which need/job is satisfied. But all these values should be communicated engaging emotionally starting with why the product has been made, a belief, a cause, something deeper than features and marketing gimicks.This in my opinion is what drives consumer behaviour. Furthermore all the features, usp, how we differentiate come second and simply serve as tangible benefits to rationalize our decision making.
I first came across this concept in Clay Shirky's book "Cognitive Surplus" - in which Shirky used the term "Milkshake mistakes" to describe the error made by the original market researchers. It is a fundamental insight that goes to the heart of discovering unmet needs and new product ideas. Customers often confound us by using products in unpredictable ways, and "hiring" them to do stuff the designers never intended them to do. As it turns out "milkshake mistakes" are quite common once you start looking for them. Intrigued by this idea, I wrote a post about it a while back - http://bit.ly/br5hZW - which describes other instances made by large companies of the same sort of error.
So much emphasis in these comments is being put on whether this is a new concept or not, and who came up with the idea first. While the real issue for me is why is it so hard for people to put this concept into practice.
Having lead Services and Solutions Marketing for several large product companies, it is very hard for the product managers and sales people to move from what the product will do to how the customer will use it. I wrote about this in a recent blog, "Products and Professional Services: From the What to the How." http://tinyurl.com/4kkc4uu
This is not just true with traditional product firms either. It is a problem with many of the B2B SaaS (Software as a Service) firms we have worked with too. Frequently, the sales people will sell the SaaS offering and because it is so easy to deploy, they think their job is done. Unfortunately, because SaaS revenue growth come from usage, not just the initial sale, they find usage tends to wither away unless they have helped the integrate it into their business processes and helped them learn how to use it.
In the end, change begins with success. We have found that the best way to change this ingrained behavior is to focus on the successes in the field of both salespeople and customers.
"The Customer doesn't want a half inch drill...he wants a half inch hole" goes the traditional marketing wisdom and that's exactly what this article restates. Most marketers are so obsessed with their product (eg milkshake) they don't bother to determine the Customer's real 'need' .... any wonder 98% new products fail!
Of course this has much similarity with age-old marketing, in particular solutions and services.
But maybe Clayton M. Christensen is just a bit better in selling it? ;-)
Its really amazing that prof.Christensen has touched the marketing concept in new way, a strategy of the marketing for a product through its style of usage,that we all were forget in the fast pace of modern marketing approach.Christensen read the real psychology of the customer.It is very common practice that marketers always put their need style and psycho in the customers mind to sale their product.This is something purely customer psycho based approach for marketing.The real idea and image of the product in customers mind is always having little deviation in all marketing methods but this approach has very very less deviation ,it appears so. Best of luck
From this concept of Christensen, I could get a analogy with Activity Based Costing approach. On similar lines, "Activity based" marketing could help in addressing the real inherent need of the consumer as we analyse to see why he/she is doing this activity and what we can supply to the consumer to complete this activity.
As always Christensen has a nice way to bring it to a global reach.... :-)
Having conducted these milkshake interviews (and many others like them across diverse markets), one part of the story needs more detail. As you might suspect, we just can't go up to a consumer and ask them, "excuse me, what job did you hire that milkshake to do?" The key to revealing jobs is in the method of uncovering the consumer story of how they chose the product. We do this by slowing down the consumer and have them play out how their decision-making process unfolded in their mind (like scenes in a storyboard). The key is to understand the physical and emotional components that go into making that decision. Being curious, empathic, and thorough with your questions allows you to fully understand their situational context - to see what they see, to feel what they feel. Armed with their context and emotional content clearly in mind, you can then tease out what we call their value code: what they considered and why the y chose one product over another. This consideration usually takes them outside traditional category boundaries and provides insight into new innovation. But without this value code, you end up developing products with features in search of benefits as opposed to designing features that deliver on specific jobs.
Bob Moesta Partner | The Re-Wired Group LLC| Re-Inventing Markets bmoesta@rewiredinc.com
This story reminds me of sudden spurt of sales of certain type of washing machines in the State of Punjab in India. When the company marketing teams visited the market place, they found out that these machines were used for making Lassi (http://en.wikipedia.org/wiki/Lassi) - a yogurt based drink. In India, I have seen many examples for such discoveries by users. They don't care for what the original product is designed for. But for good marketers these are great source for new product ideas.
This is an interesting component of strategic market positioning.
At Eco Marketing we ask: - Who are the buyers? - What problem are they trying to solve?
We also look at what the "triggers" are for customers to act. Of course, it's also important to look at the alternatives available, and what the company's advantage or benefit is.
Finally, how are you getting the word out to prospects and customers to let them know that you have what they need?
Professor Christensen's Milkshake Marketing methodology follows the functional analysis of Marcus Aurelius, later used to powerful effect by Hannibal Lecter.
In his Meditations, Marcus Aurelius asks: This thing, what is it in itself, in its own constitution? What is its substance and material? And what its causal nature (or form)? And what is it doing in the world? And how long does it subsist? . . . Everything exists for some end, a horse, a vine. Why dost thou wonder? Even the sun will say, I am for some purpose, and the rest of the gods will say the same. For what purpose then art thou? to enjoy pleasure? See if common sense allows this.
Marcus Aurelius Antonius, 121-180 C.E. From The Meditations, Book VIII
Hannibal Lecter, of course, followed Aurelius' lead and operated in total accord with Hansen's Milkshake Marketing methodology. In The Silence of the Lambs, Hannibal instructs Clarice on the methodology that would later be called Milkshake Marketing:
"First principles, Clarice. SIMPLICITY.
Of each particular thing, ask:
What is it in itself?
What is its nature?
What is the first and principal thing that it does?
What needs does it serve . . . ?"
Hannibal Lecter, to FBI Agent Clarice Starling regarding Jaime Gumb, in Thomas Harris' The Silence of the Lambs
This reminds me of my days as a graduate business student. I had just joined the school of business pursuing my PhD upon completion of an MS in Mechanical Engineering. In my marketing class, we were discussing buyers' profile for marketing products. The subject of the discussion was the Ford Mustang and typical profile: 21 years female etc. I asked my professor that if I can bring a customer who meets the exact profile of buyer, can he guarantee me a sale, and he could not respond. Later on, I realized the difference between qualifying variables and determining variables for buying products/services.
Wasn't anyone grossed out by the fact that so many people eat milkshakes for breakfast? So unhealthy. Not sure the obese U.S. needs more people drinking milkshakes (my personal rant).
My professional perspective:
Telmar & Marketing Evolutions have discovered that one reason new products fail is the advertising plan does not match the marketing goal-- 'new launch.' Until TelmarMatterhorn ROI they had no metrics to help them design a different plan for a new launch, brand awareness building, immediate sales, etc. The impact of an ad differs depending on the goal.
Spurred on by Carmen's post, our leadership team at DonorsChoose.org has read the original article. As a non-profit, our "business" is connecting people like you with classrooms in need. While all donors tell us they donate to help improve classroom education, we believe we can use this framework to learn, with even more precision, what drives people to donate. With that information, we hope to become more effective at what we do and as a result, deliver even more learning materials to classrooms in need.
The ideas provided by Prof.Clayton M. Christensen made me to think while trying to figure out my experience with Mr.K.P.Natarajan of KPN travels, Salem, India. He studied up to 7th standard and left studies to be start Bus operations at the age of 17 with 50 passengers and a single bus in 1967. His present turnover is 240 crores, with 8000 passengers per day with 18000 parcels to be sent every day. While analyzing his marketing strategy, i found that he has not relied on the Segmentation, Targeting and Positioning, but used the concept given by Prof.Christensen. He keeps in touch with his customers and asks them questions on why do they hire him or his service? He was told by his customers that they are looking for a bus service that will leave a place in Tamilnadu and go to the destination before the sun rise ( approximately before 6.30 to 7 am). All his services are based on this requirement of customers and 90% of his buses op erate during night so that the customer never looses his time. This is not a segment of the market that require night travel. It is generally need of the people not to loose day in travel and the travelers include women and children. His interaction with customers in 1970s made him to invent a new term known as Airbus that is a bus with good suspension systems. Now Airbus is a common term in Tamilnadu and every operator uses this word. There is lot of strength in Professor's argument with respect to understanding why customer hire organization for? In this case all the bus users will have Mr.K.P.Natarajan's personal cell number and he personally attends all the complaints( 100% by him personally). In the process he obtains better customer insights and designs his products. However, my hypothesis is that the concept is applicable more to services.
An excellent summary of applied marketing intelligence married to business intelligence. You want good consumer data? Go directly to the source (the consumer) and their touch point (typically, a salesperson or customer service rep). "Undercover Boss," the television show, is a classic example of the dynamic in action.
I think many times marketers make things more complicated than necessary. Maybe as the Heath brother's put it, it's the curse of knowledge that gets in the way of getting to the core of an idea, or in this case, why milkshakes were popular by commuters. The funny thing is, most of the time it was staring us right in the face but we were too busy looking at research reports to notice.
Interesting. It basically boils down to leverage and respect. Does the person doing the customer research have leverage to influence product innovation. Usually the customer research is but one set of data used and put into the pot of vested interests in maintaining the status quo, suffering from confirmation bias and representativeness.
Secondly, respect. Do we respect the client enough to engage in a meaningful and existential manner. Only then are the real reasons revealed for many purchase decisions. Consumer research and product development is not something done to clients, but done with them. Once economies of scales are brought into the mix, this respect is replaced by a transactional mindset, and the product then is reduced to something done to the customer, instead of done for the customer
I agree with most people that Christensen's view is nothing new under the sun. We have been applying this thinking for our customers for years now by segmenting according to a behavior-needs-drivers methodology. The behavior is the upper layer which is clearly visible, e.g. buying a milkshake with a certain flavour or thickness. The needs and drivers are the deeper layers. As a marketer you need to ask yourself: so what? Why are those people buying that milkshake when commuting? Then you come to the real customer needs and the drivers of these needs. The concept of drivers is very similar to these 'jobs-to-be done'. In other instances this has also been called 'outcome driven' segmentation. The most interesting point here is that not many companies apply these techniques yet. Recently I have written an article on this topic in a B2B context - I see a similar problametique there. While research shows that companies are more and more looking for innovation and growth opportunities, they do not apply these kind of techniques, let alone embed them in their processes. If you want to read more on these challenges and a structured methodology dealing with them and leading to innovation, efficiency and effectiveness gains, go to www.thom.be/node/254 where you can download the full article.
Good concept -- reminds me of Dr. Deming's carburetor story. Carburetor companies did well for years in the carburetor business -- better and better products, happier and happier customers. Fuel Injection did them in. They would have been better served if they considered themselves not in the carburetor business, but in the fuel mixing business -- the job to be done.
The wants trump the perceived needs. When I now look at my clients I am searching for the underlying wants and how to fulfill them. I run a day trading course for beginners and found too that if I stick with what I think the clients need versus what the clients want I don't get participants in my day trading course.
Initally, like the milkshake example, I thought answering the questions that I saw them not to understand was the driving force behind what I published. I used different style web sites like http://www.tradingonlinemadeeasy.com and a blog written to advanced day traders like http://www.moneymakeredge.com/blog about day trading, day trader psychology and day trading professionals.
I missed the mark as only the people with enough knowledge to understand the day trading techniques were able to understand the content. In essence even when asking the client what they would like in a website for day trading, their desire was not helping their underlying need. Like the milkshake, it is not the milkshake consistency, it is the convenience that matters most.
Putting the content in a simple and effective way based on the clients wants, not needs is the way towards the conversion.
I changed this by offering a free day trading course that they could sign up for. This went over well initially but could not maintain interest in the sites.
Clients needs versus clients wants. The Wants seem to always win.
Segmentation strategies tend to create myopia. I could always target a particular segment of the market, but why would I? To target anything means you narrow your focus to an object or person. Why would anyone narrow their focus? I want my product to meet the needs and wants of the consumers and users. Then, I want to show those who don't need or want my product why they should need or want my product. The reason so many new products fail is because creators of those products are narrow-minded and narrow in their focus.
At the same time, we can't forget that the needs and wants of the customer do not always have to be up to the customer. They are the users--not the creators. When we leave the responsibility of product development in the hands of consumers, we limit ourselves once again. I like to think I can create a product or service that my consumer has lived without his/her entire life, but after using my product or service, he/she is not sure how she ever lived without it (i.e., smart phones).
The idea is not to hone in on anything or anyone in particular. The idea is to find a need or want and meet it, and if you're really good....you'll create that need or want with your product.
Understanding of customer needs by categorizing them as jobs to be done requires a tremendous amount of customer insight. Given the dynamic situation of the market, where customers today are confronted with mind boggling choices can this approach be globalised. Maybe in a niche market where the size is finite maybe this approach would pay rich dividends, but when you look at a much larger canvas, the resource requirement to get the customer insight and design products may not be feasbile given the constraint in that area
An excellent summary of applied marketing intelligence married to business intelligence. You want good consumer data? Go directly to the source (the consumer) and their touch point (typically, a salesperson or customer service rep). "Undercover Boss," the television show, is a classic example of the dynamic in action.
Brandon
Although I don't own a huge restaurant or business...all I have determined from 20 years in business is to simplify things and give the customer what they want. Don't overcomplicate or try to outguess them. Do not try to think for them. Keep it simple. Find the need and give it to them. It's not as hard as it may seem.
It is great to let us know how we can improve a product's life. Thank you very much.
Although I don't own a huge restaurant or business...all I have determined from 20 years in business is to simplify things and give the customer what they want. Don't overcomplicate or try to outguess them. Do not try to think for them. Keep it simple. Find the need and give it to them. It's not as hard as it may seem
This is a very interesting article to read as I am in the process of starting a business and it's a good way to find the do's and don'ts.
http://www.cubeddesign.co.uk
"If you think that advertising does not work, consider the millions of people now believe that yogurt is delicious"
To break new ground, you have to invent, experiment, grow, take risks, breaking rules, making mistakes and above all ... fun
CEO
Affiliate Marketing Training
Fantastic article really enjoyed it. Like others have said to start a new concept in your life risks must be taken, mistakes will be made but we will learn from these and do even better in future life and work.
Looking forward to reading more. Excellent content.
http://www.richnicol.co.uk
Fantastic article and insights!
Gets us thinking! Now - isn't this what the latest 'Analytics' craze is all about !!!??? You try to decipher 'something' about your customer base and factor in that 'something' (after exhaustive research/remodelling) for a bigger share in the market! But then, the limitations are with the past data that's already there - and that's what our Prof. says! I must say that to arrive at 'Insights' through any kind of data-mining/analytic techniques (sans human element) - is fairly impossible. Understandably, it is now an era where things like 'What gets the job done' needs to be asked first, and asked often!
This is one of the best articles I've read about this subject. Thanks a lot. www.kitesreview.info
Very useful! Hope to see such articles more often
Thanks for sharing some powerful insights. There is still a lack of practical skills and approaches for increasing sales via business systems. To get the most out of marketing on a vastly different scale, we use customer intelligence and social networking. This change continues to grow strongly as sites like Facebook, Twitter and Linkedin extend their respective footprints in the market.
I feel there are too many negative comments on here. I thought it was a good read!
http://www.workoutathome.co.uk/personal-trainers/personal-trainer-manchester.php
Well we sell consumer products at http://www.aymafurniture.co.uk. You can obviously guess the name. However, just having the product is not probably enough. It takes some effort to make sure that you have the product customers need. And a good pricing always works magic.
The story of the consultant who spent time observing the customers was fascinating. I've always thought that we need to be detectives in order to find out what people really want. It's amazing how just spending time watching customers in any store will reveal amazing gems of how you can improve efficiency as well as getting into the minds of your customers which will help you increase sales. And you may come up with your next winning marketing or sales campaign.
Cheers!
Wow, over 50% of the comments seem negative, and a bunch of them seem to be thinly masked self-promotion. I've heard you start getting a lot of flak when you are approaching the target, and this article does that. I believe that the ability to simplify and repackage old truths in new language is a gift that causes growth each time it is given.
Simple sells...
Yes, I agree it has much similarity with age-old marketing, but is amazing how prof.Christensen has touched the concept in new way. Also is something purely customer psycho for marketing. Very good article.
I think ideally, you as an entrepreneur with a business or idea want to determine in various markets what consumers are buying and what they are using products for. Then you can go out and develop a better product or easier or better way of using the product desired and go out and get in front of the market and start capturing it with a better product.
Marketing Automation Software/a>
Learning Marketing and applying it to get the result are two aspects that are completely different. Marketing of any product require to have the knowledge of the product and as a users point of view, find out the things that must required by the people into that product. e.g. Peter is a marketing manger of an organization and successfully doing all internet marketing activities, which is also a different kind of marketing.
Thanks so much for the article. I really liked to "milkshake" example. It's true people don't buy most ideas because they nee them but because the serve some purpose to them. Making them happier, keeping them from being bored, etc. Thanks again!
Very interesting approach to marketing and new product development. Who would view a milkshake as something to hire to get a job done? Clay Christensen claims "products are more likely to succeed if companies segment their markets according to jobs-to-be-done". I would be interested to learn the success percentage on that theory. Lastly, perhaps it is because I live in the Milwaukee area but I disagree with Christensen's statement that "Milwaukee doesn't give you any market". In the greater Milwaukee area, Milwaukee Tool is a powerful brand name strongly associated to dependable and tough, especially to contractors.
Great summary of the jobs-to-be-done marketing approach. It takes us back to fundamental principles of marketing that we tend to forget as we think and talk 'strategy'. This approach is keeping things simple and grounded and sticking to the core product mix.
Marketing has always been about identifying the problem and helping create a product/ service to fix the problem, but innovation in business models rather than products/ service has put us all in horse racing injected with steroids.
Customers hiring a 'product' to get their jobs done is a great concept based on which products to be designed or messaged. The whole perspective of the product changes when you see your product being hired to do a job as opposed to selling the product where your ownership ends. This also talks about quality, user experience, service from an end-to-end perspective.
This is essentially basic fundamental principals of marketing looked under a new light. The successfulness of such a strategy depends on the customerss perception of presentation and quality. Take for example samsung selling the Samung Galaxy S II, it focuses more on the users desire for a product then what the function of the product itself. But it still does well, this is essentially the point of consumer observation. The prof. makes this point well.
Thanks for sharing some powerful insights. There is still a lack of practical skills and approaches for increasing sales via business systems. To get the most out of marketing on a vastly different scale, we use customer intelligence and social networking.
It basically boils down to leverage and respect. Does the person doing the customer research have leverage to influence product innovation. Usually the customer research best dubstep is but one set of data used and put into the pot of vested interests in maintaining the status quo, suffering from confirmation bias and representativeness.
Maybe it's just because I'm an engineer, but in my case this is exactly the sort of marketing research that will generate products I'll buy. By default the thought process I use in purchasing a product is, 'What am I going to use it for, and does the benefit justify the cost.' My wife is very much the same way, as are many of the people I know.
I'm sure this marketing strategy has it's limits, but it certainly should be considered.
Great point of view. I definitely agree with Christopher Perry. Although marketing (including Internet Marketing) has it's own limits. It's all about customer satisfaction and products relevance. We did a research on Cruciferous Vegetables 2 years ago and we somewhat found out that these products were only known to ladies(middle class). Having the overview of what to launch will give you a great chance to succeed.
You need to explain the benefits to the customer. For the most part customers do not care about your features or your innovations, they want to know what's in it for them. How it will help them. If you show them how they will benefit and it is greater, cheaper, better than the competition they will most likely become your customer.
This goes along with the ageless debate of whether features or benefits sell. I was on a e-commerce team with a company where the CEO insisted on selling the features. It failed miserably. The consumer doesn't care about the features. What they want is the benefit, real or not, that they get. We did some research on opera glasses and people don't care about the features (e.g. LED, handle, etc.) but only about the benefits (better view, more comfortable, etc.).
It is really interesting to visualize Prof.Christensens' ideas.
I would really share some important points mentioned in one of my research papers.
Correct market (Target group) product (type) relationship is to be maintained.
Basic quality of the market segmentation process mainly depends on the clear understanding of the customer.
The process should start from the customer-product relationship or the service differentiation form of the firm or the product.
Marketing person should assess whether the customer is potential or not. For this one should understand the real needs of the customer and his purchasing power. This applies to any product situation consumer, industrial or high tech product/project or service.
Hi, thanks for sharing the great insights.
I think that Christensen's milkshake marketing is brilliant as it really works. The market is really big and different products will cater for different people. So if the marketing research is showing that certain products have high demand, then it's really well-worth to go into it.
The idea is not to hone in on anything or anyone in particular. The idea is to find a need or want and meet it, and if you're really good....you'll create that need or want with your product wholesale dress.
I remember hearing about a successful pizza company (after much research) having to create many different sauces for different parts of the country. Becoming precisely what people want in business is they key!
Great post, cheers! I agree slightly with Gerald that it's a new spin on an old concept but thought the article was a good read and plenty insightful. I really liked Christensen's 'The Innovator's Dilemma' and reading your post took me right back to some of the more salient points in his book. Thanks!
Good reading, very insightful. This applies to service lines (advertising, marketing communications) as well as manufactured products. I will reference in our blog.
What a brilliant suggestion. I work with data analysis. We try to use data to make correct business decisions. Segmentation is a very important part of the data analysis as this way you can see the variance in the data and it's where the magic happens. Like in our last project the segmentation of SEO Companies was done by location like county, states and cities. However the "jobs-to-be-done" suggestion is a great way by which the data should be gathered and analyzed as well. Definitely something to think about in the future projects. Thanks for sharing
Always good information when I come here. I agree mostly with comment # 14, has some good points.
demographics is the most crucial part of marketing. In the case of the milkshake it makes since to study your demographics. Let's say the store is in a neighborhood fill with women over 50 years old, most like you will not sell any milkshake to this demographics because at at age, they start to get sensitive teeth and brain freezes.
Matthew Lewis, CEO convert youtube to mp3
That's the clue : put in the skin of your customer and go with her as she goes about her day
I think ideally, you as an entrepreneur with a business or idea want to determine in various markets what consumers are buying and what they are using products for. Then you can go out and develop a better product or easier or better way of using the product desired and go out and get in front of the market and start capturing it with a better product.
Jon Mason (NewDubstep
Enjoyed the perspective. To shake things up I sometimes ask people to imagine what the buying/selling dynamics would look like if there were just one customer left on earth.
Juan Neitz, CEO clases de ingles por telefono
This Milkshake story is really fantastic. One has to understand these basic facts and analyze them carefully to earn a good market share. Understanding the consumer behavior is really necessary to increase the sales and one has to dig into the lower levels of sales processes to get an idea of the problem. The Milkshake marketing idea should give way to new ideas.
Mike Davidson http://www.a1directorylookup.info/
Hi, this is very inspiring and motivating me, thanks for sharing, may God bless you :-)
While it's very beneficial to look at jobs-to-be-done in terms of product development, the target demographics are still very much needed from a media buying standpoint.
What he calls "job-to-be-done" is really called a use-case, and has been a basic design principle in software engineering for years. You don't start designing a product until you have a clear idea of who the end-users are, and in what scenarios the product will be used.
Moreover, after you release a product to the real world (outside of focus groups and/or design documents) you need to observe it for a while to see what unexpected use-cases appear, and whether or not your design handles these corner cases adequately.
It's sometimes funny how a concept that is so basic and commonly accepted in one field can be considered innovative and groundbreaking in another.
Alex Fink http://www.alexfink.net
Hi, this is very informative and motivating me, thanks for sharing, may God bless you.
I love this - - it is back to the future! Dig deep for insights from your customers (and non-customers) and use those insights to build better, more relevant, more resonant, marketing programs. Stop the 'push' and 'deals' and disruption and insulting ad messages. In the words of David Ogilvy (from the 60's), "the consumer is not a moron, she's your wife" (or husband, or neighbor).... Bravo
I agree that concept is good but dont think Christensen brings in something new.
Free Beat Maker