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Your Market is Bigger Than Your Product

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Your Market is Bigger Than Your Product

Do you define your market around your product or the technology in it?

Many companies do. It’s easy and convenient to explain, for example, that your company is in the drivetrain market, or the lithium-ion battery market.

But for the purposes of long-term growth and innovation, this can be a tragic mistake. Defining your market this way:

1. Leaves money on the table.

This product-based market overly narrows your focus and limits your prospects.

2. Leaves you vulnerable to disruption.

Many companies today find themselves threatened by digital disruptors that are innovating around the broader customer experience.

But there is a way to ease this threat of disruption—while also broadening your market opportunity.

Instead of defining your marketing around your product or technology, define your market around the customer’s Job-to-be-Done.Focusing on the underlying reason your customer uses your product—rather than the product itself—allows you to:

  • Play in a bigger market
  • Build a disruption-proof advantage
  • Reduce organizational complexity—and improve the customer experience

Let’s take a look at how.

Instead of defining your marketing around your product or technology, define your market around the customer’s job to be done.

What it means to define your market around a job

Defining your market around a Job-to-be-Done looks like this:

The Job They’re Trying to Get Done

For example:

  • [Caregivers] who are trying to [care for seniors in their home]
  • [Consumers] who are trying to [manage daily cash flow]
  • [Employees] who are trying to [progress in their career]

The advantages of a jobs-based market definition

Beyond providing a stable focal point for value creation, defining your marketing around the customer’s job-to-be-done broadens your opportunities while reducing the risk of disruption.

Play a bigger market

A market defined by a job is larger than one defined by a product.

You can quickly see how the market of “managing daily cash flow,” for example, provides more opportunity for innovation than being in the “checking or savings account market” or the “credit card market.” Those are solutions that help consumers manage cash flow—but they are not addressing the complete job-to-be-done. In fact, there are many solutions that help people do the job of managing cash flow, which is precisely the point. The market is much bigger when defined by the job than when defined by the product.

When you focus solely on improving your product, you miss the opportunities to solve for complementary pieces of the job—and the opportunity to help your customer get more of the job done. This narrow view of your market shrinks the pie you’re trying to grab a bigger piece of.

A prime example comes from one of our clients that always thought of themselves as building software for tax preparation. When we talked to tax preparers, CPAs, and tax attorneys, they said that tax prep is only a small part of their business. Their real job is to devise and implement tax strategies for their clients—tax preparation is a small piece of the larger job.

With this insight and a broader look at the market, this company is rethinking its offering and coming up with new solutions to help these customers get more of the job done.

Build a disruption-proof advantage

A company that rallies its resources around getting the job done better will look at all possible solutions as a natural part of their portfolio—whereas a company that is focused on technology is more likely to miss opportunities and face disruption.

A company that rallies its resources around getting the job done better will look at all possible solutions as a natural part of their portfolio—whereas a company that is focused on technology is more likely to miss opportunities and face disruption.

Consider rental car businesses.

These companies have the product built right into the brand names: Hertz Car Rental, Enterprise Rent-a-Car. But renting a car is not the job that the customer is trying to get done—the job is to get to a destination without your own transportation. Uber and Lyft understood this job, innovated to solve for it in new and better ways, and are now starting to own the market. Meanwhile, Hertz has filed for bankruptcy.

Now, if Hertz or Enterprise had focused on the job of getting to a destination without your own transportation, they would have constantly been looking for new solutions to get this job done. And when Uber and Lyft came out, they may have bought these companies rather than competed with them.

However, Uber and Lyft are in the same danger of market myopia if they think their market is ride-sharing (a solution). The disruptor can suffer the same fate if they are not careful.

Defining your market around the customer’s job-to-be-done helps you see and react to a broader competitive landscape, reducing the prospect of being blind-sided by a disruptive solution.

Reduce organizational complexity—and improve the customer experience

Defining your markets around your products often results in the business organizing around products. For example, financial institutions are notoriously organized around product silos, with different teams managing checking accounts, investment accounts, credit cards, home equity lines of credit—you name it. These teams rarely interact, let alone collaborate.

And more importantly, these silos prevent better integration of these products, which would help customers get their job done in a simpler, more efficient manner.

This siloed approach can also result in a poor customer experience. Customers are needlessly shuffled around between different product areas. They’re forced to navigate organizational and product complexity—a result of focusing on company goals rather than customer needs. Jobs-to-be-done can be an organizing principle for a company that is in much greater alignment with the customer and their needs—reducing friction in the customer experience.

Defining your market around the customer’s job-to-be-done provides a framework to both reduce redundancy and organize your business more effectively around the customer.

Many fintech disruptors have already figured this out.

Defining your market around the customer’s job-to-be-done provides a framework to both reduce redundancy and organize your business more effectively around the customer.

Just take a look at disruptors like Acorn, Robinhood, and Wealthfront. Global financial institutions are fearful of these fintechs because they are finding new and better ways to use technology to help customers take care of all of their financial needs in one place. You see, customers do not want to cobble together different products, they want a single platform to get their entire job done.

Wealthfront, for example, allows you to bring your cash accounts and investment accounts (brokerage, retirement, etc.) together at one company, automate your savings, automate your investing, predict your future net worth, borrow against your investments, etc.

Ironically, big banks and integrated financial institutions are in a good position to compete with these fintech companies. They have all the assets and know-how to serve these customers. But defining their markets and organizing the business around products makes it slow and cumbersome to respond to these agile disruptors.

No wonder these fintech startups have huge valuations right now…

Define Your Market

If you’d like to test run this approach and begin to uncover some of your own opportunities, we’ve created a tool to guide you through it.

The Jobs-to-be-Done Market Definition Canvas is designed to help you define the market you are in or have chosen to serve, through a Jobs-to-be-Done lens.

The canvas lets you start by defining your market in solution space and guides you to redefine it in problem space as [a group of people] + [the job they are trying to get done].

It’s time to start thinking bigger.

Rob Schade

Rob drives client success with his deep expertise in Jobs-to-Be-Done (JTBD) theory and Outcome-Driven Innovation (ODI). He has advised leadership teams in many industries, including technology, manufacturing, consumer packaged goods, medical device, and fintech. He also has deep expertise in the area of service innovation – helping companies to innovate current service offerings or create entirely new ones. Rob is also responsible for marketing and sales efforts where he shares his passion for improving the innovation process, a commitment he picked up during a decade working in hardware and software ventures in Silicon Valley. He received both his undergraduate and master’s degree in Accounting and Finance from the University of South Carolina. Don’t be surprised if you receive a call from Rob during an ODI engagement – he is dogged in his pursuit of making sure our clients are satisfied!

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