A business without a customer is a business doomed to fail. While it may be arguable who the customer is, there is a customer, and they are the driving force behind business decisions.
One reason businesses experience growth stagnation is the loss of clarity on their customer’s needs. Other growth inhibitors include serving the wrong customer or focusing too much on the customer’s wants. Regardless of your business vertical, these problems are real, and real solutions exist for them.
You are in business because you solve a problem for your customer. The thing is, you may be solving a different problem than you realize. The early days of UnPakt.com give us an example. They started out trying to make booking movers easier for people trying to move. They thought the problem that needed solving was central access to booking movers, similar to a central booking site for flights. When their expected growth did not come, they had to re-evaluate the actual problem they needed to solve. How did they find the right problem? Feedback loops.
They essentially had two customers they needed to solve problems for, the moving companies and the people moving. They adopted a wide variety of techniques for getting user feedback, such as A/B testing, survey rewards, and direct user interviews. They discovered the problem they needed to solve was trust, not access. (
https://www.forbes.com/sites/forbesnycouncil/2018/02/21/are-you-solving-your-customers-real-problems-heres-how-to-find-out/?sh=3bd0b2034bb8)
The problem you think you’re solving for your customers may not be the problem they’re solving. Alternatively, it may no longer be the problem they want solved. Implement feedback loops to identify the problems you are solving and the problems your customers need solved. Act on your findings, and keep seeking feedback.
Know Your Customer
Your customer is the person using your product to solve their problem. If you don’t have a customer avatar, that’s an excellent place to start. You may have customers you don’t realize, though. Sarah Moore’s interview with Shaan Puri has a great example of this. In it, she mentions that what she initially perceived as an “egg company” was actually a specialty packaging company where “40% of our business comes from things entirely unrelated to eggs.” (https://shaan.beehiiv.com/p/1-woman-50-fake-ids-egg-business) As she got to know the business better after purchasing it, she realized her customers were not just chicken farmers but anyone who needed specialty packaging.
If you ignore 40% of your customers, you’re leaving a lot of opportunities on the table. All customers will pay more for a better solution to their problem, especially if they are an edge case. With proper feedback mechanisms, you’ll have a feel for who your customers are. If you see organic growth of new customer verticals, it’s worth taking a step back and looking for the opportunity. For instance, Nvidia is seeing fantastic growth by shifting its focus from consumer graphics cards to business-focused AI cards.
Watch for novel uses of your solution worldwide, even if it isn’t your product, and you may unlock many new opportunities for your company.
Know the Real Problem
When Business Insider talked with Kaite Dill, VP of Design at Lyft at the time, about Steve Jobs’ famous statement that customers don’t know what they want, she mentioned the importance of observational feedback over solicited feedback. (https://www.businessinsider.com/steve-jobs-quote-misunderstood-katie-dill-2019-4) The idea is that asking people what they want to change about a product will sometimes yield different results than observing what they do with it.
The classic example is people wanting their horses to go faster but not having the imagination to conceive of the automobile revolution hastened by Henry Ford. This is an example of pursuing the solution instead of the problem. When we solve a customer’s problem, we do it by providing a solution. The trick is how we come to that solution.
The most obvious way to solve a customer’s problem is to ask what they want and provide it. There is nothing inherently wrong with this approach. In fact, as it involves a feedback loop and concentration on customer value, there is a lot right about it. To truly scale and innovate, something more is needed. Feedback has to come from beyond customer reviews and surveys. Some of it can come from observation, but even that has limitations.
Imagine you run a hammer-making company. You are going to favor solutions that require the use of a hammer. You may find solutions to problems customers didn’t think of, but they’ll still be through the viewpoint of having a hammer to sell. You’ll need to think beyond the hammer, the faster horse, to truly innovate. Try bringing someone in from outside to help observe your customers and find solutions. Their fresh perspective could be just what your company needs.
Some companies struggle to move past growth plateaus; some struggle to stay relevant in a rapidly changing environment. Any company that does not have a feedback loop is doomed to fade over time. That may be from losing customers as their needs change or a new solution emerges elsewhere. It may be from a dwindling customer base when there is a world of other customers that need the solution.
If you don’t have feedback loops in place, get them. If you aren’t sure where to start, contact me. We’ll set up an introductory call. I can help you discover your true customer, the problem you actually solve for them, the solution you really have, and ways to get valuable feedback loops in place so all of that can grow and change as our world does.
