Nail the problem

- Step two of The Innovator's Method is to make sure that you're nailing a problem that a customer's willing to pay for. Now, let's just focus on what is a problem? And I want to start by helping you to think about this by using what's called a job to be done perspective. So, if you think about it, when you buy a drill, you actually don't want a drill. What do you want? You want holes of a certain size and type. When you buy an iron and an ironing board, you don't want an iron, you don't want an ironing board, you want pressed clothing. The job to be done is pressed clothing and when you can really understand that job and what people are willing to pay for it, then that may open up the doors for a variety of solutions that might get you pressed clothing, that don't involve an iron and an ironing board at all. Maybe it's some wrinkle release spray or some steaming device that gets attached to your shower or your washer. So, understanding the job to be done and understanding that problem is a really important step, and that involves really deeply understanding the customer. Now, there tend to be three dimensions to any job and this is something that many of us don't think about, but there's a functional dimension, what will it help me do, an emotional dimension, how will it make me feel, and a social dimension, how will it make me seem or be perceived by others? So, to illustrate functional, social, and emotional jobs, let's talk about Harley-Davidson. Harley-Davidson sells motorcycles and, yet, in advertisements, they almost never talk about the functional capabilities of their motorcycle, how fast they are, their reliability. It's always something about their brand and what it can do for you. In one advertisement, a young man is admiring a motorcycle on the street. A young woman comes up, thinks it's his, and she starts to admire both him and the motorcycle. He likes this. But then he's discovered when someone else comes along and rides off in the motorcycle, and the narrator says "Maybe you should get your own." So, what's the point? You hire a Harley-Davidson in order to be cool, in order to impress the girl. And that's an emotional job. You might hire a Harley-Davidson so that you can meet new riding buddies and join the Harley Owners Group. That's a social job that's very important as well that has nothing to do with the functional requirements of the motorcycle. So, here's the point. When individuals have a problem they're trying to solve, they reach out and hire something to help them solve that problem, whether it's a drill, an iron and ironing board, or a motorcycle. Sometimes it's a functional job that they're hiring it to do, but sometimes it's emotional and sometimes it's social. And your job is to do a deep dive on understanding the customers' jobs, functional, social, and emotional, that they want met with the problem you're trying to solve. One of the mistakes that we see frequently made is that someone comes up with an idea and then they immediately jump to the solution that they think will work, without spending enough time really making sure that they understand the customers' problems and the jobs that they want done. So, it's really important not to skip that step and jump to the solution. So, how can you make sure that you're nailing a problem people are willing to pay for? Well, we suggest two different kinds of tests you could use. One is what we call a wow test. A wow test is after you've explored the problem that someone wants to have solved, you ask them, on a scale of one to 10, would you be willing to pay, you can pick X number of dollars, in order to have this problem solved? And if you will get 50 to 100 people, but at least 50 who say, on a 10-point scale, I'm willing to pay X amount of dollars to get this solved, then it means you're probably ready to move to the solution phase, because a lot of people are saying I'm willing to pay something to have this problem solved. Of course, the better way than the wow test is actually a payment test. This is where you actually create a sort of theoretical solution, and it could even be an advertisement that shows what your solution might be. This is what Kenny Pereshar did with his company Coin when he decided he wanted to see how many people would be willing to pre-order a card that you could put all of your credit cards on, so you wouldn't have to carry them around with you. What you do here is you put out your potential solution and you see how many people will pre-order. If they pre-order, that's a payment test. It means it shows they are willing to pay something to have this problem solved. And if they're willing to do that, now you know this is a problem worth solving. When Pereshar did this in a Kickstarter type of campaign, he literally raised hundreds of thousands of dollars through pre-orders, at which time, he knew, he took the risk out of whether to build this product, because he knew people were willing to pay to have this problem solved. So, the second step of customer immersion, really understanding the customer, understanding the problem, and seeing if they're willing to pay to have the problem solved is really important before moving to the third step, which is to, now, start to create different solution options to solve that problem.