It's Friday night.
After an awesome concert, you help your friends to load the gear in their van.
You are so excited that you want to go to another gig that night. After parking the van, you hear people cheering up nearby: One of the most popular amateur rock bands in town is playing for free in a bar!
You get in, the atmosphere is incredible, the sound is perfect, and you even find some friends by surprise.
What a night!
And it happened totally by chance!
Later, going back home still amazed about the experience, you think:
How could I have known this beforehand? How could I plan it the next time I go out?
If I had an app to see amateur concerts in a given area, I could have known about this concert beforehand.
Also, since these events usually take place in bars and cafes, it would be great if I could see their special offers or menus.
You ran a quick query in Google to find out how many bars are there in Spain. How big could this market be?
It turned out that Spain is the country with the highest bar density in the world (1 per 175 people, with each person spending an average of 1.900€/year in them).
It's a HUGE market! I'm into something:
A verticalized platform to help bars, cafes, and restaurants to increase their customer base by showing their offer with detail and controlled by them, not generated by users.
I could barely sleep that night.
I spent the next week of august (2011) looking for alternatives:
- Yelp was big, but only in the US. Also, their data was chaotic since they were more a review aggregator, with users generating the content showed up about the businesses on the map.
- Google Maps had almost no data of this kind. They focused their value proposition on navigation.
- Tripadvisor was focused on hotels and restaurants.
- Foursquare worked to see where people were, but the user base in Spain was tiny.
So I drafted a few mockups, created a business plan, and in two months, I had a 100.000 € investment from a business angel to start the business.
This story may sound like the classic intro of a success case from Silicon Valley.
Sadly, it was not.
We gathered a great team, mixing experience with talent, energy, and ambition and built an (on paper) great product for a vast market. I loved the idea.
So, why we had to close? What failed?
But the main one was building the solution based on my idea, without digging enough in the problem we were trying to solve.
And like 42% of startups, that set us in a doomed course from the beginning.
Problem space vs. Solution space.
In the middle of the Space Race in the 60s, astronauts asked for a way to take notes in space.
What do you think the Russians did?
They equipped their cosmonauts with pencils.
I've found this great example in Dan Olsen's Lean Product Playbook. He uses it to introduce very clearly how Intuit's Co-founder, Scott Cook, made PMs like him think about problem-solving.
It's simple but game-changing.
Following the example of the Space pen, think about it for a moment.
What did the astronauts want?
- A pen that works without gravity.
Instinctively, we think first about what is familiar to us. We all write with pens, don't we? If we continue that path, we will instantly erase all other possibilities that are not a pen or similar tools.
We are conditioning ourselves, giving our idea a shape and several functionalities by default.
Let's dig deeper.
- A writing tool that works without gravity.
A little bit better. Just reading the sentence, you can instantly imagine other tools that could do the work: a pencil or a marker, for example.
We can do better.
Let's go another layer down.
- Something to record and retrieve information in conditions of zero-gravity.
Do you see the difference?
We are now talking about the problem—the truly need they experienced. In this case, we don't limit ourselves by shape or type of instrument.
Think about the array of possibilities that arise after just digging one more level—abstracting our imagination from the constraints of a plastic tube with a metallic tip in one extreme.
The best way to know if you are skipping this critical phase is to analyze the words you use when talking about your idea.
Anytime you talk about some kind of shape or attribute related to your idea, you are in the solution space.
- Interface design
On the other hand, when you use terminology related to your customer's pain, its characteristics, and circumstances, you are in the problem space.
Why is this so important?
Because when you jump straight into the solution space, you are implicitly making some assumptions without proving them (besides discarding other viable solutions).
Also, it's very common to fall in love with our ideas, not with the problems our potential customers have. That's another red flag you should avoid at all costs and one of the main reasons startups fail.
We spent six months developing the first version of gointu (our startup). When we launched, we discovered that bars, cafes, and restaurants were using Facebook to connect with their customer base.
They were not tech-savvy, so using a new service was daunting for them. Facebook was a familiar platform, and their average customer was already a user.
They posted pictures of their menus, promotions, or events. And, with closer customers, they used WhatsApp.
And they loved our solution, its design and functionalities. But it was not enough for our target customers to do a full migration from Facebook. There they already had a following and a vast user base to reach.
All of this happened because I didn't research enough the problem we were trying to solve and which was all our competition, not just similar products.
So, what would I do if I knew what I'm telling you?
What tool would I use now to understand better the problem we were trying to solve?
The Jobs To Be Done theory.
Jobs To Be Done (JTBD): Your secret weapon to dig into the problem space
During my career, I used a lot of different frameworks, techniques, and tools aimed to gain knowledge of problems that a segment of the market share:
Design thinking (I'm a certified practitioner by IDEO), focus groups, buyer personas, empathy maps, value proposition canvas, the 5 Whys, etc.
None of them is perfect, and all of them make sense at different points of the research phase. But the most useful I've found for this stage is the theory of Jobs to Be Done.
Because it helps you see problems as stories, not just as data points. This way, you'll cover the key factors but also the numerous blind angles that surround the mother of all questions for every business on earth:
What causes a customer to purchase and use a particular product or service?
Let's define first what a Job is.
A Job is the progress that a person is trying to make in a particular circumstance.
It looks like a simple definition, but it encompasses more than it seems.
Let's deconstruct it:
A better version of herself that the customer is trying to achieve when hiring a product or service. It's a process, not an event in time. This is the best analogy I've ever seen to that:
The particular specific context in which the need for that job arises. They can be categorized in emotional and social ones. Following the previous analogy:
The core analogy in Jobs to Be Done theory is that we hire products or services to do a job for us.
We don't buy products or services; we pull them into our lives to make progress.
Another critical difference regarding other tools or techniques is that JTBD puts particular emphasis on the emotional and social dimensions of the buying process.
It's an organic framework that helps to forge a story about a problem that a group of people has by assembling insights. It's not just a tool to extract attributes from a group of people (something valuable too, but insufficient at this point, in my experience).
Pure data or "rational" aspects are ok when you measure a market or evaluate feedback. Still, it turns out that 95% of our purchase decision making takes place in the subconscious mind.
Think about when you bought your smartphone, car, or clothes.
Did you think only about their cold and hard specifications?
Have you bought your last shirt due to its cotton - nylon proportions?
Do people buy a 6 cylinder, 300 HP with 4 wheels thing, or a BMW 330i?
You get it.
So, how can you use the JTBD theory?
I've created this Job To Be Done Canvas to help you do the exercise. Copy it to use it with the business ideas you want to evaluate.
Let's deep-dive on a JTBD example step by step:
What is the progress that your customers are trying to unlock?
Functional, social and emotional dimensions of the desired progress (note that social and emotional dimensions can outweigh the functional one)
I want to attach images to my social media posts to make a great impression with my work to my followers and potential ones.
Which are the circumstances surrounding the process?
Emotional and social. Who, when, where, while doing what?
When publishing my content, after investing a lot of work to create it, I don't want to look like useless or bad quality due to my poor experience in graphic design. Also, if it's ugly, I fear it accomplishes the opposite goal: to dissuade people from reading it.
What obstacles prevent them from achieving it?
I've tried professional software, like Photoshop, Illustrator, Sketch, or Figma, but they are too complicated for me, and I don't have time to invest in specific training to use them. Hiring a freelancer for this task is neither an option because it wouldn't make my efforts profitable.
Which are the existing solutions they are using to make the desired progress?
- Product competition: Photoshop, Illustrator, Sketch, Figma: Steep learning curve, too complicated for the task at hand.
- Generic competition: Unsplash, Shutterstock, Google images: Impersonal, used by a lot of people.
What would be "game-changing" for them?
In my experience and other success cases, this is an optional insight.
Because this implies stepping into the "solution space." They can give you ideas, but following them could limit you. Also, think about the Henry Ford famous quote:
Example: Something that would allow me to draw simple images with text over them. Easy to customize and adaptable to the main social networks.
As a result, we could envision a service like Canva to be hired for this job.
Canva helps non-designers to create high-quality designs with a simple drag and drop editor.
And they seem to be solving this problem quite nicely to their customers. In 2019, Canva was valued at $3.2 billion, with 85% of Fortune 500 companies using the product.
But I don't have competitors!
Yeah. Been there, said that.
For 99% of the products in a given market, there's competition. And I'm leaving a 1% chance of not having it because anything is impossible.
The key to understand this is to know that there are more types of competition besides products aiming to solve the problem in the same way as you.
The four main types of competitors you can identify are:
- Brand: similar product attributes, benefits, and price.
- Product: similar kind of product but different characteristics, benefits and price)
- Generic: different products solving the same problem. They are substitutes.
- Budget: different products financed with the allocation of the same resources.
Let's see an example. Our product would be, in this case seeing a movie in a theater:
Need covered: Entertainment
- Brand: Inside Out, Drive, The Godfather, Avengers.
- Product: Streaming services, digital renting.
- Generic: Videogames, Sports events.
- Budget: Table games, Books.
Do you see competition now for your idea?
Problems shape markets.
I can't overstate enough how critical is this.
A good business idea starts with a deep understanding of the problem it aims to solve. Without it, you'll probably build a solution desperately seeking a problem.
The main goal of this essay is to give you a different lens to look at problems from a business perspective.
A lens to help you set a solid starting point upon you will build everything that follows—something key to increasing your chances of succeeding with your product.
Though this theory is relatively new, the underlying principles have been around for quite a long time.
Take a minute to reflect on Henry Ford's quote I referenced before, and you'll see the JTBD theory behind it. He understood that people hired their horses to go from one point to another. Also, they were sending a message of status according to their horse breed and customization of the seat.
He seized edge technology at the moment to create a better way to solve that job—a truly disruptive innovation, not just an incremental one (like faster horses would have been).
In the next essay, I'll show you what to do when you have the treasure (literally) that you have in your hands when you discover an underserved need:
How to measure the market it shapes, divide it in chunks, and choose the one with the bigger chances of success.