Business Matter
Manish Shah is the former president of Midwest Law Printing in Chicago. He also worked at Intel, PwC and Motorola. He has an MBA from Kellogg Graduate School of Management, and a MS in Computer Science from Illinois Institute of Technology. He can be reached at manishshahus@yahoo.com.
By Manish Shah
Clayton Christensen, the author of The Innovator’s Solution, contends that every job people need or want to do has a social, a functional, and an emotional dimension. The marketers need to understand these dimensions to design a product. Christensen argues that the fundamental unit of analysis for developing products should not be the customer but the job to be done.
Let us take the case of Whole Foods Market, a highly successful retailer of organic foods. What are Whole Foods’ customers trying to accomplish? They want to buy fresh, organic or naturally-raised foods for their family. They have the choice of shopping at small specialty natural food stores or at local farmers markets. Independent natural food stores are sparsely located, have limited selection and a low turnover. Since their overhead is generally high, their prices are also high. Farmers markets also tend to have high prices and they are accessible only a few times per week. In contrast to these alternatives, Whole Foods offers competitive prices, convenience of shopping all year round, wide selection and fresh produce.
Other successful companies have developed products to help customers accomplish their jobs. e-bay helps people sell personal items. Google helps its customer find information. Procter & Gamble (P&G) developed the highly successful Swiffer to help its customers carry out the job of cleaning floors. To develop the Swiffer, P&G did not undertake a demographic or psychographic study of people, who mop but instead focused on job to be done.
The traditional segmentation of a market is along lines of their product characteristics (category or price) or customers (age, gender, marital status and income level). However, this sigmentation is static because does not take into account the ever changing nature of a customer’s buying behavior. For example, demographic data cannot explain why a man goes out to a fancy restaurant with his date one evening and next evening he stays home and orders a pizza. Therefore, in order to design successful products, we should be mindful of the tasks that our customers are trying to get done.
