(light music) – To give you an illustration of how we develop this in a deeper way, McDonald's approached this, and McDonald's is a very sophisticated marketing company. They have data up the kazoo. They decided that they needed to innovate in their milkshake product line so that more people will buy milkshakes. They had data that allowed them to draw a quintessential customer of milkshakes, milkshake customers. They then would identify this profile of a milkshake customer. Turns out I fit that profile very well. They would then invite
people who hit the profile into conference rooms and
they'd ask them questions, trying to understand, "How
could we improve the milkshakes "so you'll buy more of them?" They'd get very clear feedback.

They would then improve the milkshake on those dimensions of performance, and it had no impact on
sales or profits whatsoever. So we invited ourselves, and they agreed, that we could try to approach
it in a very different way. That is, you know, there's
a job out there somewhere that arises in people's life on occasion, that causes them to
need to buy a milkshake. We need to understand what the job is that causes people to buy a milkshake. One of our colleagues stood
in a McDonald's restaurant for 18 hours one day, and
just took very careful notes, on what time did he buy the milkshake? What was he wearing? Was he alone or with other people? Did he buy other food with
it, or just the milkshake? Did he eat it in the restaurant, or did he go off in a car and take off? It turned out that about
half of the milkshakes were sold before 8:30 in the morning.

It was the only thing they bought. They were always alone. They always got in the
car and drove off with it. We came the next morning
and positioned ourselves outside the restaurant
so that we could confront these people as they were
emerging with their milkshake. In language that they
could better understand, we asked them, "Excuse me. "You're creating real trouble for me. "Can you explain what
job arose in your life "that caused you to come
here at 6:30 in the morning "to hire a milkshake? "What's the job to be done here?" They would struggle to
answer why they came at 6:30. We'd ask them, "Step back
a minute, and think about "the last situation in which
you had the same situation, "needing to get the same
job done, but you didn't "come here to hire a
milkshake from McDonald's.

"What did you hire to get the job done?" One guy said, "Yeah, I
hire donuts to do the job, "but I can never hire just one." Another guy said, "I do bagels. "But boy, they're dry
and they're tasteless. "So I have to put cream cheese on, "and steer the car with my knees "while I'm putting cream cheese on." It turns out one of them said, "I hired a Snickers bar to do the job, "but I felt so guilty. "I've never hired Snickers again." One guy said, "You know, I
never thought about it before. "But last Friday I hired
a banana to do the job. "But it doesn't do the
job very well at all. "You finish it in less than a minute. "But let me tell you,
when I go to McDonald's, "it is so viscous it
takes me about 23 minutes "to suck it up that thin little straw.

"I don't care what the ingredients are. "All I know is when 10 o'clock comes, "I'm still full." The job that all of these
people were trying to get done was "I have a long and
boring drive to work, "and I needed something
that would just keep me "engaged with life
while I'm driving a car. "I'm not hungry yet. "But I know I'll be hungry by 10 o'clock." So also part of the job is, "I need something to eat
that would keep myself full "when 10 o'clock happens." That's the job that they're
hiring the milkshake to do.

That is, they have a long
and boring drive to work, and they needed to add dimensions of it to keep them engaged with life. From the customer's point of view, the milkshake does the job better than any of the competitors. The competitors, from the
customer's point of view, are not just in the product category. But they draw from bananas and donuts and bagels, as I mentioned.

When you think about how big the job is, you have to look at who
the real competitors are from the customer's point of view. They come from very different categories. How big is the market for milkshakes? It's a serious question. Well, who knows? But the size of the milkshake just isn't the sum of the milkshakes at Burger King, Wendy's, and McDonald's milkshakes.

But it includes, from the
customer's point of view, all of those other attributes of bananas, donuts, bagels, Snickers bars. When they implemented this insight in the portions of America
where they developed it, it turned out to be seven times bigger than they had thought,
when it was marketed only by the attributes. Most markets are characterized that way. There is a lot of nonconception. You can understand how to improve it only if you understand the job to be done. (light upbeat music).

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