Know They Want It
Based on my 25+ years researching business success patterns, giving people what they'll want before they know they want it has been a valuable approach for some firms, even years ago. Yet, although some companies successfully used this approach years ago, many firms stayed away from it because its value was eclipsed by an emphasis upon formal market research that asked people what they wanted.
More recently, however, the business value of giving people what they don't yet know they want is getting increased attention. It's the subject of a recent book Demand: Creating What People Love Before They Know They Want It by Adrian Slywotzky. It's also getting attention due to Apple's tremendous success, especially since Isaacson's popular biography of the late Steve Jobs, Apple's co-founder, tells how Apple does not do market research since the market doesn't yet know what it wants.
The two books differ in perspective regarding giving people what they don's yet know they want. Slywotzky's book describes many innovation based businesses and key steps involved in commercializing innovation-such as coming up with something magnetic that customers connect to emotionally, solving problems that hassle customers, finding triggers that induce buying, etc. The Jobs biography, on the other hand, conveys the message that Apple was successful without market research because customers don't know what they want. That message is what I elaborate on and explain here in this newsletter.
Go Beyond the Difficulties of Asking People What They Want
Traditionally, companies used market research based heavily upon surveys and focus groups to find out what people want. But, these techniques are not the only way to sleuth for what people will want. And, in many situations--like Apple's, for example--they are not the best way. This has been the case long before the recent emphasis upon giving people what they want before they know they want it. So, I'll share examples from years ago that I have used to stress the importance of going beyond asking customers what they want and basing what customers will get on a true knowledge and understanding of what they might eventually want.
The first example involves asking people about animals that might make good characters. The frog is one of the least preferred, probably because frogs may be perceived as slimy and ugly. Despite this, the Muppet character Kermit the Frog has been extremely popular. If asked pre-Kermit, most people would not say they'd like to see a cute frog as a character. But, Kermit's creator developed the right kind of character. Yet, people didn't know they wanted it when they were rating their perception of frogs.
Airfreight is another example. Years ago, when airfreight was still in its infancy, asking customers if they'd want to ship cargo by air could elicit negative reactions like: why on earth would I pay extra to ship via air when other modes of transportation are much less costly. That reaction occurred because customers did not yet know they wanted to ship via air. But, when airfreight was presented as a way to do business with fewer warehouses and lower inventory costs, customers wanted it. Thus, giving customers what they want before they know they want it was possible through understanding customers so well that it was presented in a way that lets them realize they want it.
Also, market research, itself, is an example. Due to their training, experience, or what their companies expect, many users of market research, and even market researchers, themselves, wanted to discover customer wants by asking customers. Like consumers who did not know they wanted an iPhone before it came out, many who used or did market research still did not know they would want to uncover customer wants without asking customers, who may be unaware of those wants. Now, that is changing, and the value of figuring out what people want before they know they want it is increasingly recognized.
It is knowledge and understanding that enables companies to discover what customers may want before they know they want it. This comes not from merely asking customers what they want, but from thoroughly understanding them and inferring what they want. In some cases, greater knowledge and understanding may come from observational (ethnographic) research, which unlike surveys and focus groups, concentrates on observing people to better understand them and discern what they might want--perhaps before they know they want it--rather than just asking. Yet, questions asked in surveys and focus groups may increase overall general understanding, which depending on the design, interpretation and circumstances, may or may not help when trying to infer what customers might want, but not know it. Other research and analysis techniques may play a role as well. The key is not so much which research techniques are used, but rather whether adequate knowledge and understanding can arise to infer what customers will want.
But, true knowledge and understanding often comes from sources beyond formal market research. Having a solid background or extensive experience in an area, and knowing much more about it than customers do, often brings knowledge and understanding that helps identify what customers want before they know they want it. Also, when you, yourself, are the customer, or you spend considerable time with people who are like the targeted customers, there is potential for having knowledge and understanding of what customers want before they know they want it.
How Apple Succeeded Without Market Research
The above was the case for Steve Jobs. He and the people he worked with could relate to and were potential users of the Macintosh, the iPad, the iPod, and the iPhone. So they had the knowledge and understanding to make those products extremely successful. On the other hand, Jobs did not succeed when, between his stints at Apple, he founded Next Computer, aiming to sell high-end workstations to university researchers. Jobs was not a university researcher or administrator. Although he visited universities for input, he could not truly understand what computers universities would buy for research before they knew they wanted them. He was too removed from that market. So, even with approaches Jobs is admired for today-such as combining technology with humanities-Next was not successful.
In contrast, without market research, Jobs could understand that consumers wanted Macintoshes, iPads, iTunes, iPods, and iPhones before many consumers, themselves, knew they wanted these items. In fact, a number of highly successful entrepreneurs did quite well, generally without market research, for this very same reason. They, themselves, were the customers. And, as long as their needs and wants are typical of the market, they may be able to understand what people want before those people do. The same is true when someone very close to them is typical of the market. And, with this kind of knowledge and understanding, combined with Apple's accumulating experience with its customers, Apple was in a good position to know what those customers would want.
In summary, knowledge and understanding can enable companies to give customers what they want before they know they want it. Sometimes, traditional market research plays a role, but developing knowledge and understanding entails far more. That's why the Winning Moves approach puts great emphasis upon ways companies can enhance and apply knowledge and understanding.
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