I attended a great seminar by Dr. Clayton M. Christensen at the University of Pennsylvania last Friday night celebrating the 20th anniversary of the EMTM program. Dr. Christensen is the author of The Innovator’s Dilemma and the person who coined the phrase “disruptive innovation” that “describes a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves ‘up market’, eventually displacing established competitors.”

The first part of his seminar was a terrific presentation of examples of disruptive innovation, and in the second part of his talk he encouraged companies to focus less on customer and product segmentation and instead ask the question “What jobs are your customers hiring your products to do?”

He told a story of a fast food restaurant that wanted to sell more milkshakes, so they did what many firms would do: they interviewed their customers to discover exactly what features that they wanted in a milkshake. Then they took the results of that research and used it to build the perfect milkshake that their customers described.

Did sales go up? No.

Did sales go down? No.

In spite of building this great milkshake that they were sure was going to hit their customers’ sweet spot, sales remained flat.

So they hired a team of consultants to watch how people purchased milkshakes throughout the day, including how they were dressed, who they came in with, the time of day, etc.

And they found something very surprising.

The majority of milkshakes were sold early in the morning to customers who came into the restaurant alone and purchased only a single milkshake. Finding this interesting, they began to interview these customers, and they found that what they had in common was that each one had a particularly long commute to work in the morning.

It turns out that the job that they were “hiring” the milkshake to do was to accompany them on their long drive to work. But why milkshakes? Well, if you wrote a help wanted ad for the milkshake’s “job,” it might look like this:

Wanted: Reliable Food For Long Drive. Must be sweet, cold, and filling. Must fit in cup holder, require only one hand to consume, and last for most of the trip. Must not make a mess in car or on clothes. Must have slightly healthy appearance. Coffee, bagels, candy bars, sodas, and breakfast sandwiches need not apply.

You see, many of the milkshake customers had tried other products for the job, but none of those products had the unique combination of qualities that made the milkshake the perfect fit for their tacit job requirements. And it wasn’t really even about the quality of the milkshake; it was about the general characteristics of the product that made it right for the job that the customers were hiring it to do.

So what did the restaurant do to improve sales? They moved the milkshake machine to the front of the store and made it self-service so that these customers did not have to wait in the breakfast lines. They could come in, get their milkshake, swipe their card, and go. They also offered a new type of milkshake with small straw-size pieces of fruit inside that made it last a bit longer (they were harder to suck up the straw!) as well as adding some variety to the taste and texture.

In the end, it wasn’t about what features that the customers thought would make a great milkshake. It was about discovering the unspoken job description in the customer’s mind that made the milkshake the perfect candidate for that job.

I wonder if they tried coffee milkshakes?

There was another group that was the next largest purchaser of milkshakes, and I suspect it was for many of the same “job qualifications.” Can you guess who they were? The answer is in the comments section.

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