Will people pay $1,000 for the new iPhone X? Almost certainly. Until last week, we had no idea that animojis existed. Pretty soon, Millennials everywhere will wonder how people ever communicated without them. As Apple celebrates the 10th anniversary of the iPhone launch, it seems a good time to reflect on how desire is created in the 21st Century. Is the age of the iPhone a case study in identifying and meeting hitherto unmet needs? Or is it possible that the world would have been just as happy a place without Siri, animojis and haptic displays?
The age of the iPhone has coincided with the age of customer-centricity. The rise of the job-to-be-done and design thinking theories demonstrates a global shift in business focus towards a more empathetic, user-led approach. Y Combinator, ‘the world’s most powerful start-up incubator’ according to Fast Company, has a simple recipe for success: ‘Make something people want’. With a combined value of over $80bn, its companies include the likes of Dropbox, Airbnb and Reddit. Meanwhile, Amazon’s mission ‘to be earth’s most customer-centric company’ has made it the fourth most valuable company in the world. But customer-centricity is no longer enough; CEO Jeff Bezos has since begun talking about ‘customer obsession’.
This obsession with customers has fuelled a $45 billion global market research industry with the sole aim of understanding in ever greater depth what people want. Despite this, 75%-95% of new products fail to find an audience. Even Y-Combinator is fallible – despite its technological acumen, customer-centricity and insight focus. For every Airbnb there’s a SpoonRocket – the start-up that promised to deliver meals in under ten minutes at a cost of under ten dollars. A mere three years after raising $13.5 million seed capital from Y Combinator, the company published a goodbye blog post. Its direct competitor Sprig, known for its great customer service and high employee retention rate, shut down only a few months later. So did a string of other startups that had promised to make food more accessible and convenient – including Maple, Din and Bento.
Why did these customer-centric companies fail? The truth is making things people want diminishes a company’s ability to be different. It dooms you to focus on the same customer insights as all of your competitors. This explains why so many absurdly named food apps could be chasing so many of the same customers all at the same time… and failing as a result. The chances are if your company is able to identify an unmet market need, there are at least three other companies looking at the same needs and developing a similar response.
So what’s the alternative?
Twitter provides an interesting example of a non-customer-centric approach to innovation: a communication platform that limits how people can communicate. It is what co-founder Biz Stone called “the messaging system we didn’t know we needed until we had it”. Rather than anticipating customer needs, Twitter typically lagged behind its users: it wasn’t until a critical mass of users started including an @ symbol as an identifier that the Twitter team added the functionality natively to the Twitter platform. The same thing happened with hashtags and retweets. Twitter isn’t a case study in customer-centric innovation; it’s a testament to the power of creative constraint.
Vente-privee, a French flash sale website that sells discounted stock from luxury brands, uses a similar technique to retain customers and stand out from imitators. Rather than appealing to people’s desire for simplicity and speed, the brand experience is built around the idea of ‘strategic inconvenience’. In many ways, it is the very opposite of Amazon’s customer-obsessive approach: the company provides no information about its offer before people register; it doesn’t have a search function; it only sends sales notifications 24 hours in advance. Yet its users love it. It makes them work hard. It’s an online equivalent of scouring metre after metre of anonymous sales racks, with all the emotional reward that comes when you finally uncover the hidden treasure you were looking for. “[If] you need something, you go to Amazon. With Vente-Privee, you need nothing but something in your head says: let’s go and see if there’s something fun, or if I can go and buy something cheaply.” said its founder in an FT interview in June. The strategy – which is extremely difficult for competitors to copy – works, as its €3.1bn revenues from last year seem to prove.
Being customer-centric – or even customer-obsessed – is far from a guarantee of success. The brands that succeed aren’t those that pander to customer needs; they confront and question those needs. Twitter and Vente-privee both demonstrate the power of thinking differently.
The message is clear: don’t seek merely to deliver what people want. Any company can do that. Most are. When faced with a list of your customers’ needs, don’t just ask how you can meet them better. That’s exactly what your competitors are doing. Instead, explore how you can challenge them. Identify opportunities to subvert them. Play with them. That’s how desire is created in the 21st Century.
What are Wild Cards?
The Clearing have been working with The School of Life to develop 100 questions designed to help you see your brand from new perspectives. We think great conversations begin with a great question. Each week, we’ll share another question and our response to it. Email us with your own answers on email@example.com – we’d love to know what you think.