Mental models and context

Imagine two scenarios. Two mothers.

Mother one – when it’s time for her one year old son to go to sleep, she gets him ready and rocks him to sleep. As the baby starts to drift off to sleep, she puts him in his crib. She gently rubs his back while he is still in light sleep, leaving only when he has fallen into deep sleep.

Mother two – when it’s time for her one year old son to go to sleep, she gets him ready to sleep and reads him a book. Then she kisses him good night and puts him in his crib. The son complains, and the mother says some soothing words. She sings him a song. But then she leaves the room wishing her son a final Good Night. The son might complain a little, but very soon he starts talking to his stuffed animals, and singing. After about 20 minutes, he is fast asleep.

Question to you: Which mother is doing the right thing?

Your answer might depend completely on your mental model, which is shaped by the context in which you live.

If you have grown up in a joint family, where there are plenty of people to take care of the child, then option 1 sounds wonderful. You are showing all the love and support to the kid. Why not do that?

If you have grown up in a nuclear family, then option 2 sounds great! There are other things to be done, and besides, aren’t we teaching our kids to be independent from n earlier age?

I came across this situation on my tip to India. And the funny thing is that the parents on either side were fascinated by how the other side handled things. My wife and I were amazed at the patience shown in taking care of kids (me less so since I grew up in India). On the other hand we got regular questions like – ‘Oh did your son sleep so fast?’ ‘No, but he will on his own’ – our reply. ‘Oh wow, its amazing that your kids can do that at such an early age’

How does this affect products?

This is a blog about product management. Why am I going on and on about mothers and kids and fathers and sleep and diapers? There are two important aspects that are highlighted here which we tend to overlook – mental models and context

 

A mental model can be thought of as a filter one applies to the actual truth. It takes the overwhelming complexity of what is going on in the real world and makes sense out of it. It would totally ignore several inputs, and highly bias other inputs based on past experience, deeply held beliefs and what else is going on in the person’s life. I am calling this ‘what else is going on in the person’s life’ as the context in which the mental model is working.

Let’s look at some examples of where mental model and context changes the situation completely.

Wheels on bags

One of the most fascinating product stories for me is very simple – wheels on luggage. The first fascinating part: wheeled luggage was introduced in 1970. Decades after luggage was introduced. Why so? Well the initial context was different – people did not have to walk through large airports carrying heavy bags with them. Trains were more popular than planes, there were lots of porters that could carry bags for people etc.

Then the context changed. Airplanes became more popular, requiring people to carry heavy bags across much larger distances with fewer porters. Yet for a long time people carried on with the previous mental models – bags are meant to be carried.

Even after wheeled luggage was introduced it did not immediately pick up popularity. People stuck to their old mental models – especially men. Men saw themselves as strong, macho guys who did not need wheels to help with bags. Things really changed only after TravelPro introduced rollaboards that became popular with flight crews. These role models ultimately led to mass adoption of wheeled luggage.

Hence such a ‘simple invention’ – putting a freakin wheel on a bag – took so long to gain acceptance.

What is the right meal for me?

 

One of the best examples I have heard of is from Des Traynor in his talk Product Strategy in a growing company. He takes a simple question – what is the right food for a male 35 years old who works in tech?

The context of consumption changes everything. Without understanding the context you cannot answer it. Example – what if this person is going out on a date who he really, really likes to impress? Likely a meal that gives him plenty of time to chat over (likely) alcohol is a good idea. Steak might be optimal. But what if the context is – oh this person needs to eat while working on a presentation for a client due in 1 hour. He cannot waste time, has to multi-task. Pizza delivered to his deck sounds like a much better idea.

Growth

I would argue that one of the biggest determinants on how fast a company will grow is how much the product, marketing and sales of a company aligns with the mental model and context of the user. Anything that makes users have to change either is a speed bump.

There is a lot of software companies now selling predictive apps – applications that can make judgement based on predictive analytics, that are promised to be better, faster or cheaper than human judgement. I used to work for one. A roadblock is making the end user believe that the application is indeed better than their own judgement. We are all inclined to believe apps that predict things we know less about. Take the weather for example. Predictive models have been used for while – we tend to use them rather than looking at the sky and determining how the weather will be this afternoon. However for other purposes not so much. For example, predictive applications in sales – sales people tend to be skeptical that analytics can tell them what their accounts are likely to buy more than they would themselves, despite plenty of evidence to the contrary.

Final words

Context and your user’s mental models changes everything. Understand them well – ignore at your own risk 🙂

Strategy is the How

This post was originally published on the High Start Group blog – http://www.highstartgroup.com/strategy-is-the-how/

Strategy is one of the most overused words in ‘business language.’

‘Our strategy is to make our customers happy, be a provider of high quality and low cost widgets, demanding a price premium while being the best channel partner there ever will be in the history of the universe’

A statement I made up. But not so unrealistic given other stuff that exists.

The thing is – this is not a strategy. This is what an organization wants to be. This is a vision and a set of goals. Which is fine. A vision should be lofty and inspiring, and something that the people in the organization can get behind. Goals should be lofty, yet not completely unrealistic. Vision is what we might be at some point in time. Goals are milestones towards achieving the vision with; normally with some type of timeline attached.

Credit: GoodStrategyBadStrategy.com

So what is strategy?

I have been reading a book called ‘Good Strategy Bad Strategy’ by Professor Richard Rumelt of UCLA Anderson School of Management. Really fascinating read. The author dedicated several chapters to explaining what strategy is, how to recognize what the strategy for a given company is, and how to define your own strategy. At the very basic level, strategy is the how. Not the plan, but what are the coherent set of actions that are needed given the set of problems the organization is expected to face. And most importantly, what are the trade-offs we will make to achieve those.

Let’s take an example

There are 1000s of books written about strategy, so I will stick to a basic example. Let’s say I am your neighborhood pizza store. I am not part of a chain. My specialty is that I offer gourmet pizza, it is completely customizable, tastes great – better than any other location in the area. Right now I serve pizzas by the pie, for dine in or take out, made fresh to order. My pizza is made with all natural ingredients, and cost 2x more than other pizzas. It also takes 30 minutes to prepare from the moment I order. Most other pizza places take 10 minutes.

I want to expand I am now trying to figure out whether I should start offering Pizza for delivery, or open a full service restaurant which will be 3 times bigger than my current location.

At the basic level, let’s review the current trade-offs, from the perspective of the owner

• I only prepare Pizza fresh when the customer orders it. This means I am unable to serve those people who just want to get a slice on the go. But my Pizza tastes great!
• I use natural, fresh ingredients. Hence my prices are higher. But knowing this gets me a lot of customers who are health conscious. Especially people with kids.
• My pizza takes longer to prepare – which also means people in a hurry cannot get it

Now let’s look at the two options.

Offering Pizza for delivery

One of the key questions to answer when expanding a business is – for whom? Who are the type of customers for which you plan to deliver Pizza? What are their needs? So the owner might conduct some market research, and find that the people who want to order these pizzas are parents who love to dine at the location anyway, but cannot make it there because of kids bedtime. They do not mind waiting some time to get the food as long as it is of similar quality.

In this case it makes logical sense to extend in this line of business. Sure, you need additional marketing, pizza making capacity, ability to deliver etc, but this line leverages a lot of existing strengths.

On the other hand, the owner might find that people who order pizza in are normally college students who want cheaper pizza, really fast, and lots of it. Sure the owner could expand in this line, but then what different is his pizza place as compared to the domino’s and papa johns around the corner? How does the owner adopt to this new segment?

Opening a restaurant

Opening a larger restaurant with a broader menu is the other option. This requires certain new skill sets – managing a wait staff, adding menu items other than Pizza (e.g., it could be a salad and pizza place), expanding the footprint of the store etc. But what I like about this option is the complementarities of the situation to the existing place.

1. It takes 30 minutes to get Pizza – why not have starters and alcohols to upwell customers at that time?
2. If there is demand, why not extend the Pizza place (in terms of number of people)?

The question then becomes – will the Pizza place do well as a restaurant? Is it visibly distinguished from other restaurants in the other area? The owner needs to review these impediments and then finally make a decision on whether to open a restaurant or not.

It’s all about decisions and design

The key thing is that in either of these options, the strategy was not what we wanted to do. The strategy was ‘now that we have decided what we want to do (i.e., the vision and goals), how do I get there.’ The strategy supports major goals. In this case, there was a goal of expansion; the strategic planning exercise went through looking at options on how to achieve the goal, reviewing the expected obstacles, making the necessary trade-offs, and then designing the strategy to tackle them.

Strategy is the how. Not the what. Figure out what you want to be first, and then determine the how.

On Competition

I don’t remember how many times I have come across a startup that was asked who its competitors were. And the answer was – ‘Oh, we have no competitors.’

Perhaps we are understanding competition wrong.

Whenever I think of competition, I think of alternatives i.e., how else could the person/company do the job they are hiring your product to do.

Let’s say you are producing a comedy TV Show. The job your ‘users’ are hiring you to do is to help them spend some time being entertained, away from their daily grind.  What are your alternatives? Other TV Shows at the same time. Or any other TV Show that can be ‘DVR-ed.’ Or YouTube. Or board games. Or restaurants. Or computers. Basically, anywhere your users can spend time and be entertained.

Noticed I said users, and not customers. This is TV Shows are a two-sided market. They get attention from viewers, an sell the attention to advertisers.

Back to why I thought this. It is because of news about wearables. This article clearly lays out that wearables – while competing with each other – are now competing with Smart Phones. The latest iOS and Android devices have better tracking capabilities, and so App makers can build apps that exceed the native functionality that Fitbit and others offer right now.

With this increased competition, the first generation of devices is now in danger. New devices offer a lot more capabilities. The question is – how easy will Apple or Google find to build the functionality in the Phone? Does building the same functionality actually degrades phone performance in some way (e.g., draining battery too fast)? Is there a patent or unique technology you have?

The new generation of wearables has to do a lot more to tackle this new competition. I look forward to seeing what works.

THE TALE OF THE TWO SHAVING OILS

 

I have used two shaving oils over the past few months. The differences between two similar products just outlines how much difference positioning can make to a product.

Let’s be clear on terms

For the purpose of this post, Product = Physical product your produce, Brand = what your customers perceive of you product as, Positioning = what you do to make sure that the customers have the perception you intended

The two products

The first company  is called the Art of Shaving. I came across advertisements for Art of Shaving on the Boston T. The Art of Shaving store and website exudes a sense of  luxury and expert skincare for men. When you walk into the store, you see a barber shop on the right, and a store on the left. Well groomed, well dressed salesmen walk you through the store and help you smell and try various products.

To really elevate your shaving experience, you need to purchase a full kit (picture below) starting at $115.

 

The product I bought from the Art of Shaving was a sandalwood shaving oil, designed to be used with shaving cream/foam. It is essentially a pre-shave oil, and retails for $25/60mL or about 40 cents a mL. The smell was sandalwood, smelling all ‘Natural’

 

 

 

Now let’s compare that with the new shaving oil that I bought from Amazon.com called Shave Secret. It costs 7 dollars for 18.75 mL, though you can get it for ~4 dollars at Walmart. Given this price, it was approx 25 dollars for 60 mL too, which I just realized now when I did the calculation! In my mind, it was significantly cheaper – I guess it would be had I got it at Walmart.

 

 

This product is not a pre-shave oil. It replaces all shaving creams and oils – so you use just the oil and shave. I tried it, and had a pretty nice shave with it!

 

So the product shave secret is significantly better than the Art of Shaving oil in terms of utility. What then explains the difference in price?

 

Customer utility = total experience

We have to think of customer utility in terms of total experience. Here is where the products completely differ. Here is how they might want the customer to experience the product

The Art of Shaving: Shaving is not just a daily chore you need to do. As a man, this is the one opportunity for you to take care of yourself. Would you not give yourself the best, most luxurious experience possible? Shouldn’t your skin look and smell great after shaving? What message do you want to send to your partner/potential partners?  When you give a gift to a man, wouldn’t you want it to be the best?

Shave Secret: Shaving is a pain – the nicks, the cuts, the application of oil, cream, the clean up. We simplify everything. With Shave Secret, you use only out product, and avoid any creams. Result: smoother shave, faster cleanup, no rinsing after shaving. Get in, get out, save $$, and have the most convenient shave possible.

It’s all about positioning. And choices

The point is, both of these positions can work. And does work. For different people. It ultimately comes down to the customer – what does the customer want out of the shaving experience? Attitudinal segmentation might be a good answer here – what attitudes do customers have towards shaving?

What is important that the executives behind these products choose the position and align all resources and processes behind the position. You need very different skill sets to make these work.

Art of Shaving needs branding and retail skill sets. And a supply chain that handles lots of different product. And excellent customer service that ensures that the same upscale experience is present across stores, website and catalog.

Shave Secret needs efficiency. Efficiency in making sure that the product is manufactured at the lowest cost, and a supply chain that handles making sure inventories are correct across various retail outlets.

Ultimately, it comes down to choices. I admire both companies for choices they have made, and both will be successful. As long as they are authentic to the positioning they have chosen.

So what’s the lesson?

Choose your positioning carefully. Don’t try to be everything to everyone. Decide what you want to be when you grow up. Then stick to it, and make it work.