There is a question that has been plaguing marketers and business leaders since the dawn of time.
Why do customers really buy?
In order to market smarter and more effectively, you need to be able to pinpoint the answer.
Katelyn Bourgoin is a 4x founder and the current CEO of Customer Camp, where she helps product teams figure out what triggers people to buy.
She didn’t always know the answer.
In fact, it took learning the hard way to propel her onto the path of customer understanding.
At the age of 28, she had just launched a VC-backed tech company. Forbes and other big-name entities were calling it the next LinkedIn.
“Since I'm talking to you right now and not sipping a margarita on the beach, we did not become the next LinkedIn,” Katelyn said while presenting at our Wynter Games virtual event series.
“We knew who our customers were, but we didn't really understand why customers used our product. So I do not want you guys to make the same mistakes.”
Data-driven decisions only take you so far
Katelyn founded Customer Camp specifically to help brands gain a deep understanding of their customers.
If you ask a brand to tell you why their customers buy, they’ll often focus on the product or service.
“They're going to say our software is easy to use, or we're cheaper than the competition, or our sandwiches are the best in town,” said Katelyn.
While that may well be true, it does not convey a deeper understanding of the customer psyche.
If you want to get big marketing results, you can't just focus on the product. You need to better understand your customers.
The old method marketers used to understand customers involved creating elaborate customer profiles and personas based on data.
The goal was always the same: the more you know about your customers, the better you can market to them.
In theory, this makes sense. “Data-driven decision-making was obviously a lot better in the Mad Men marketing days,” said Katelyn.
“The days when marketing was led on gut instinct and, you know, stereotypes.”
Too much data
Today we have an astronomical amount of data about our customers. We know who they are. We know their age, income, location, job titles, and industries.
We know what they're searching for. We know what they're clicking on. We know where they're spending their money and their time.
“We are drowning in audience data, but we don't know what to do,” Katelyn said.
The crux of the problem with customers is that it takes a lot of corporate spending to turn a lead into a paying customer.
“It actually costs 50% more to acquire a customer today than it did five years ago. And that is really depressing,” Katelyn said.
“And the problem is that we have so much customer data, but it doesn't tell us what we desperately need to know. It doesn't tell us why customers buy.”
Katelyn gave the example of buying a new alarm clock.
She knew that she bought the clock in order to wake herself up earlier and pursue fitness goals.
But all the alarm clock company only has access to data like: she is married, 35 years old, lives in Canada, and is active on social media.
“None of this actually explains why I bought the alarm clock,” said Katelyn.
The Jobs to be Done framework
Why do customers buy?
There was no clear answer in sight until Katelyn discovered Clayton Christensen.
A Harvard Business School professor, Christensen put forth the controversial idea that the way businesses were gathering customer data wasn’t working.
What we needed to do was put customer decisions in context. Today, this is known as “Jobs to be Done.”
It’s a theory for understanding what motivates people to buy.
And the premise is that people buy things because they want to make their lives better. They want progress.
But they're struggling because there are obstacles in their way.
If you look at buying through this lens, people “hire” products and services to complete a job.
If the products work well, the customer keeps using it.If those products don’t work, they get “fired” (the customers stop using them).
“It is important to understand that this is not about what your product does. It's about what your customers can do because of your product,” Katelyn said.
“And this is an important distinction. And it's one that a lot of marketers miss.”
Understand use cases
An interesting note here is that sometimes, a so-called “inferior” product can do a better job for the customer.
It all depends on the use case. To go back to Katelyn’s new alarm clock, it’s much less sophisticated than her smartphone.
There is no snooze button. There is no Internet access. But that’s exactly what Katelyn wanted.
Before, she was pressing snooze repeatedly and wasting time lying in bed surfing Twitter. Now, she has no excuse not to get up immediately and go for a morning run.
Zero in on what they want to achieve
“Rather than focusing on who a customer is, which doesn't actually explain why they buy things, Jobs to be Done will help you to zero in on what they actually want to achieve.
And when you understand your customer's jobs, you're going to see who your real competitors are,” Katelyn siad.
Is this complex information to acquire?
But when you take the time to do it, it’s well worth it to understand exactly what’s driving customer purchasing decisions.
Once you know what triggers your customers to buy, you can start getting in front of the right people, at the right time, with the right messaging.
Gathering customer stories
How do you get to the heart of customer motivations and identify their Jobs to be Done?
It takes more than a short survey or phone call.
Because 95% of purchases are driven by unconscious urges and emotions, sometimes customers haven’t fully analyzed their own thought process.
You have to dig for it.
Interviews or surveys?
To get below the surface and tap into that subconscious level, you need to conduct interviews with recent buyers and gather customer stories.
“I call these types of interviews Clarity Calls, because they're going to help you to get so clear on what actually matters to your customers,” said Katelyn.
“Des Traynor, one of the founders of Intercom, he says, ‘one interview is worth a thousand surveys,’ and this is pretty powerful coming from Des, considering that Intercom actually allows you to create surveys.”
The goal of the Clarity Calls is to explore your customer's buying journey in exacting detail.
Typical buying journeys consist of the following steps:
- Trigger event
- Passive Looking
- Active Looking
At the end of the Clarity Call you’ll understand your customer’s buying journey.
Starting with the first trigger that prompted them to look for a solution, and ending with whether or not they are happy with the product they purchased.
Capture customers in the “passive looking” stage
Most brands focus on the Active Looking stage of the buying journey, instead of the Passive Looking stage.
In doing so, they miss key opportunities.
“So many marketers are missing out. They are not investing the time to understand why people buy. And they're not trying to see what the triggers are that might make people begin the buying journey,” said Katelyn.
To complete the alarm clock example, if your marketing team is trying to rank for the keywords “bell alarm clock,” it’s insanely competitive.
But if you try to rank for the phrase “how to wake up earlier,” the playing field is wide open.
“If you're targeting buyers that are already looking for a solution, it’s 19x more competitive to get in front of them when they are actively looking. So that's a problem,” said Katelyn.
Understanding customer motivations can also help you craft the perfect copy.
Instead of describing the dimensions of your alarm clock, you could pull readers in by saying “stop hitting snooze on your life goals”.
“Wake up earlier with this no snooze alarm clock.”
This language will be compelling to your customer because, as you will know from your interviews, it’s exactly what they are looking for in an alarm clock.
Looking at your product as something that is hired to complete a service is game changing
It provides a fresh way of looking at the challenges in your market space, and how your product can help solve them.
It also inspires you to reach out to the most important people in the process - the customers themselves.
We hope you’re ready to take your brand beyond surface-level data to the stories underneath.
Full video from Wynter Games is here!