Blue Dots Partners

A few years ago, my great partner, John Orcutt, told me something that stuck with me. The story goes that John heard a priceless maxim when he was managing HP’s Managed Home Global Business Unit. He learned it from his boss, Steve Manser. Apparently, Steve heard it from John Friend who was CTO at Good Technology, who himself may have heard it from someone at McKinsey! The essence of the quote, which may have been refined across multiple generations or interpretations is:

“What has to be true to make this happen?”

This struck me because so many times at Blue Dots, we see a misalignment between the way the management team sees, understands and describes their target market and their customers’ Pain and how things actually are. It turns out that, more often than not, companies don’t really know, at a fundamental level, why some prospects buy and more importantly why some don’t buy. In other words, they don’t really get to know what I call the “Market Truth.”

Why does it matter and how do you uncover the market truth?

The right way is simply by asking customers and prospects the appropriate questions. I would caution that this can’t be done by the company directly for several reasons: management can’t really be objective as it’s hard to hear that their baby might be ugly. Best not to ask! A customer would have a hard time to explain that they made a mistake when they bought the product. The same way, there is nothing in it for a prospect to explain why they did not buy, as they moved on.

So, this must be done by an experienced, independent third-party company and is implemented by conducting a series one-on-one phone interviews. I am not talking about an online survey to get a Net Promoter Score (NPS) or some kind of Q-Score. This is not about asking someone to go to a website following a link printed at the bottom of a receipt and answer a few questions. This is not a post-sales customer survey. I am skeptical about the methods and results of these types of surveys. Often, people answer to get a reward (“get a free Starbucks coffee if you answer these five questions”), and because it’s online, the survey is too rigid and you can’t get a real feel, at the emotional level, about what is going on inside the person’s head. You lose the tone and emotional voice, which carries 38% of the importance of the conversation[1].

I am talking about plain old phone conversations, conducted by someone who is not emotionally attached to the answer and has no vested interest whatsoever in the response, be it positive or negative.

Serving our Clients, we have used a well-defined process to conduct these external customer and prospect interviews and have done it more than 4,000 times over the course of 100-plus projects. The amount of insight that comes out of them is tremendous. In my view, it is critical for the interviews to be conducted by an outside firm because unbiased data is essential for unearthing the “Market Truth.” This impartiality ensures objectivity, integrity and honesty.

There are some rules and a dash of art to asking the right questions and not getting carried away during the interview. It’s a delicate balance between keeping the interviewees focused along the interview guide and giving them some leeway to freely express their thoughts and ideas.

People’s attention span is very short. Preparation is essential so that you make every minute you have with the customer or prospect count. The questions have to be meticulously crafted and the flow carefully choreographed. There’s no “winging it,” and asking the wrong question can result in customers who feel their time has been wasted.

There are many possible “right” questions one can ask, but here’s one, for example, I find particularly revealing to determine how fundamentally important a product or service is: “If I were to come on Friday afternoon and take away or unplug the product, how would you feel and how would you spend the weekend?”

Conversely, here’s a good example of the wrong question to ask. Imagine that one of your customers has been using your product and spends $500 per month for it on a subscription model with a one-year commitment. “Are you happy with the product?” would be the wrong question. The person made the decision to buy it and would have a hard time recognizing it was a mistake. I have never heard a customer say, “We spent $14,000 over the past twelve months on this product and it’s a bad product.” This would be a confession that the customer made a mistake in selecting that product. Instead, the right questions to ask is, “What budget are you allocating for next year to that product? What about the following year?” This is quite interesting, because the number is a lot more telling. If the person does not want to continue using the product, you’ll know from the number that is given to you. The best answer is when the person is planning for a budget increase, which means that more usage of the product is anticipated. Not only is this a vote of confidence in the product, but an increase in usage demonstrates stickiness in the organization.

Don’t stay in the dark. Use a microscope and discover the Market Truth. This will help you better understand your customer’s Pain and will illuminate the right way to express your Claim. It will result in a better alignment with your customer’s expectations of what your product or service should deliver and most importantly, why they should buy.

[1] Source: combination of two research studies: Mehrabian & Wiener, 1967 and Mehrabian & Ferris, 1967.