Think the customer is always right? In these three cases, you want to listen to your gut, not your customers.
Would you bring a new product to market if your current customers said they didn’t want it? Well, that is exactly what happened in 1992. The product? Voicemail.
Mike Buhrmann, founder and CEO of Finsphere, a mobile financial technology startup, was working at McCaw Cellular Communications back in 1992. His job was to introduce value-added products to the cellular network. He reached into his bag of tricks and pulled out voicemail, a rarely-used service from his days at Cantel (which later became Rogers Wireless).
"Cellular voicemail was slow to ramp up," Mike explains. "Our market research and focus groups showed that people would just hang up and not incur an airtime charge."
So why did we stop hanging up?
The tipping point for cellular voicemail resulted from something so small and so simple that it's hard to believe it's a true story. The shift came when McCaw introduced the message-waiting indicator.
"No one could resist wanting to know what message had been left for them and by whom," explains Mike. "It was the precursor to AOL's ‘You've got mail!’ Later on, we added a message count and voicemail became a communications staple."
The moral of the story? There's a time and place to ignore feedback.
Steve Jobs spoke often of the customer’s blind spot. In biography of Steve Jobs, Walter Issacson quotes Jobs as saying, "Some people say, 'Give customers what they want.' But that's not my approach. Our job is to figure out what they're going to want before they do.
Anyone who takes this theory too far can end up claiming genius and foresight, and cop out of the important work of customer discovery. Not taking the time to understand your target market’s current unmet needs is a sure-fire way to create a market of one: you.
That said, there are times when it is essential to ignore your customers.
Entrepreneurs who are pioneering new markets often find customer demands to be maddeningly contradictory. That’s because the problem-solution set is not entirely clear in early markets. In this situation, the key is not to ask customers what they want. You need to figure out where they are deeply frustrated and what workarounds they are already using to solve a particular problem.
It’s easy to conflate prospective customers with actual customers. A pipelined customer is not a customer. A customer is someone who has paid money for a product or service that you are producing now. A sure path to failure is to chase prospective customers who say, "If only your product only did X, Y, or Z, I would buy."
In startuplandia, early customers are often comprised of friends, friends of friends, and family. The reasons they buy your offering may have very little to do with whether your product solves a real need. A sign that you are stuck in a false market is when the orders plateau quickly after you’ve tapped your network. Watch to see if these early customers recommend your offering as is to others who, in turn, buy and buy consistently without any relationship to you.
Sometimes, the mantra "listen to your customers" can be downright detrimental. Not all customers are created equal. Opinions are cheap. Behaviors are where the real insights lie. Ultimately, it’s about asking the right kinds of questions of the right people, and then observing what they do rather than what they say. Steve Jobs may have put little stock in what people actually said, but he was a keen observer of what they did.
KELLY FITZSIMMONS: Kelly is a well-known entrepreneur who has built and sold several companies. Currently, she is the co-founder and director of HarQen, a next generation web-telephony company. She is an alumna of Springboard Enterprises, and a contributor to Springboard's Been There, Run That column.