Brands are changing.
Perceptions of a brand are increasingly measured on whether they deliver against the product and service expectations we have for them. Online resources give consumers vastly better product information – from peer reviews to price comparison sites – meaning that their purchase decision-making can become a much more rational assessment of real value (Simonsen & Rosen, 2014 ) And apps such as Uber – or more broadly ‘Uberfication ’, the growing sector of on-demand mobile service provision – have created new and much higher expectations for how easy and frictionless a service can be.
So what a brand does via its products and services is now much more important to customers than what it says.
Marketing has to change radically – but customer understanding is only more essential. So here are some initial first steps to building great products that your customers will want to use.
Start with the customer
Today’s empowered, social, networked customers are not just “always on” but “on demand” – hence the need for companies to put them at the heart of everything they do. Staying close to customers and understanding their needs in real-time is critical to delivering winning products and services.
Within this, as Alex Osterwalder sets out in his book ‘Value Proposition Design’, it is important to understand:
- what CUSTOMER JOBS they are trying to do
- the GAINS – the outcomes customers want to achieve or the concrete benefits they are seeking
- and the PAINS – the bad outcomes, risks and obstacles related to the customer jobs.
Ranking these three elements in terms of priority is the first step to ensuring that you focus on those needs that the most of your customers care the most about.
Ensuring “Fit” with your valuation proposition
The flip side to understanding your customer profile is ensuring that there is a fit with your value proposition.
Start by creating a value map of how your product/service helps customers alleviate pains and create gains, then rank these by importance, says Osterwalder. You achieve “fit” when customers get excited about your value proposition because it addresses important jobs, alleviates extreme pains and creates essential gains that customers care about the most. Achieving this fit is hard to find and maintain so having a rigorous process to ensure this is essential.
According to Des Traynor from Intercom, here are 10 important questions and principles to keep in mind when thinking about your product road map:
- Does it fit your product vision?
- Are you improving or innovating an existing feature in your product?
- Are you focusing on the areas that get the job done better by 20-30%?
- Are you getting more people to use the product and to do so more often?
- Will the feature matter in 5 years?
- Focus on the things that don’t change
- Does it benefit all customers not just a few? Sometimes new features only divide existing usage
- Watch out for side effects
- If a feature takes off can you afford it?
- If you can’t do it well, it’s not a good feature
Integrating lean start up principles
Erik Ries and Steve Blank’s work on the ‘lean startup’ was inspired by ideas of ‘lean production’ developed by Toyota, but pulls them from manufacturing into the world of consumer product and service design. They propose a 3-fold model:
- Hypothesise how you product will create value for its users
- Listen to users: Get feedback on every aspect of your product & business model & revise your assumptions
- Practice ‘agile development’ by developing incrementally and iteratively
[Source: ‘Why The Lean Startup Changes Everything’, Steve Blank, HBR May 2013]
Blank’s process eliminates slack and uncertainty from product development by continuously building, testing and learning in an iterative process. This approach is key to providing evidence that your customers care about how your products and services kill pains and create gains. Building a range of hypotheses and different experiments to test them in regard to your value proposition is essential to reducing risk and uncertainty and increasing the likely success of the product launch.
At FACE our inverted co-creation model is one of the ways in which we help brands do all of the above with rigour and speed, building the customer’s needs into every step of the product development process.
Embracing social technology and software
Finally, in all of this social technology and software has a huge role to play in the “Business of Products”. Developing products that can help brands and companies meet the demands and expectations of today’s customer cannot be done without a deep understanding of technology.
As Steve Denning wrote on Forbes.com in his article entitled “Why Software is eating the World (a title taken from Marc Andreessen’s own article by the same name in 2011): “All Companies are now software companies,” and for most of them, “failure to acquire digital agility will be an existential threat and so, establishing digital agility has become in effect a strategic necessity.”
Software is not just disrupting traditional business models by helping new entrants meet customer needs better and faster – it is helping the new entrants to re-define them. As I indicated at the start of this post by mentioning “Uberification”, what Uber shows is that even so-called ‘offline’ products and services (such as taxis) need to become apps, and are defined by the digital user experience they offer.
At FACE we don’t just advise companies on product development. We’re doing it ourselves with the development and scaling of Pulsar, our social data intelligence platform. We have fused software engineers and data scientists together with own innovation and research expertise to revolutionise social media research. We are seeing first hand what it takes to apply the “business of products” and are now focusing on delivering the next stage “the business of platforms”.
That, though, is a topic for another blog!
If you would like to find out how we can help your company innovate, then please get in touch by emailing: email@example.com