I recently stumbled onto a video of Adam Morgan (Co-founder of eatbigfish and the co-author of a brilliant book – A Beautiful Constraint) shares his perspectives on how we live in an age of unreasonable consumers and what do we need to think about in order to succeed in this world where we are surrounded by unreasonable consumers.
You can watch the entire video here.
The first question that comes to mind when I listen to Adam present is to question if we really have become unreasonable consumers?
I believe the answer is absolutely. We now expect to have clean, transport whenever and wherever we want to arrive and be hassle free.
We expect products we order to arrive same or next day and for them to cost cheaper than ever.
We want to binge watch an entire season of a TV series during a weekend.
We expect to order multiple items online and simply return what we dont like. We dont even want to go to a store to try out a new dress or a shoe or an eye wear. We want it to come to us in the comfort of our home.
And this is just the start. Every single area of our lives, we are getting more and more unreasonable, not because we want to but because we are trained to be, by brands which elevate their game and as a result make consumers more unreasonable.
This also makes consumers much more intolerant of bad experiences. Add to this is the fact that they can easily and most certainly have the ability to express their opinions (negative one’s much more than the positive one’s) to their followers or connections.
So, the question then Adam asks is the following:
As a brand, how are we going to respond to these unreasonable expectations of the unreasonable consumers (whom he calls Uber’s children– Adam Morgan
I believe here are some ways we can respond to this unreasonableness:
Become more unreasonable than the consumers:
This is probably the most effective way to respond to the expectations of Uber’s children. We need to be much more unreasonable on ourselves than they expect from us.
Adam shares the example of One Toyota, a car dealership for Toyota cars in the US. When one of their customers cars become due for their first service (5000 miles), they are able to service the car and deliver it back to the customers in under 6 mins. This is less than the time it takes for the customer to walk to the cafeteria, order a coffee and finish it.
When its customers did not believe that their cars were actually serviced, they had to run an information campaign to show how they do this to their customers, so they can believe that their cars were actually serviced. Now, once our customers experience this, everything else becomes unsatisfactory.
So, the question then is how to become more unreasonable than our consumers?
We can do that by looking at improving the performance, convenience and price points of our products or services by a factor of 5 or 10, instead of 5 or 10%.
In my conversation with Porus Munshi, the best selling author of “Making Breakthrough Innovations Happen”, he had shared that it is both easier and more interesting to go after an innovation that aims for a 10x improvement than going for a 10% improvement.
The reason for this being, there is no way we can achieve a 10x improvement by tweaking what we do now. The only way we can achieve this level of improvement is by rethinking how we work and what we work on (You can listen to the entire conversation I had with Porus for my podcast – Pushing Beyond the Obvious here).
In conclusion, I can only say that, to do have breakthrough performance in an era of unreasonable consumers, we need to be more unreasonable than our consumers and keep looking for ways to bring about a 10x improvement in how we serve our consumers.
To do this, we need our leaders to believe that this is possible. We need the leaders to start expect this. We need our leaders to enable the teams so they can go after these goals. We also need our leaders to be on the look out for opportunities for 10x improvements everywhere around us.
As Adam shares in his talk, most organisations that are happy to maintain their brand and position in a category, will start losing to those who will push boundaries and progress both their Brand’s and the categories in which they operate. They will continue to create more and more unreasonable consumers.
These consumers will continue to expect that level or unreasonableness from all their vendors/partners, which if and when doesn’t happen, move on or worse stay with you as they themselves dont want to work on 10x improvements. The collective weight of these organisations as a collective will take them all down slowly and then suddenly.
So, the question that leaders need to answer is the following:
I agree that consumers are becoming more demanding as the level of service increases. It becomes an arms race as you point out and when one organization sets the bar higher, others need to meet or exceed that level of service, convenience, etc.
The issue is what is sustainable? Netflix provided lots of high quality content at an enormous cost to meet the insatiable needs of customers which inflated production costs across the industry. Years ago, a colleague in the media and entertainment space told me that Netflix was throwing the market into disarray with their level of spend raising production costs and triggering a battle for talent. The recent course correction in Netflix stock price (35% drop in a single day) and their admission that they needed to reduce their profligate spending illustrated that this was not sustainable.
Some orgs are attempting similar feats of exceptional service to attract market share and share of wallet but is that sustainable? Perhaps it is in some cases, but in other cases it will not be.
Your observation that brands are training their customers to be unreasonable is spot on. But there has to be a limit to how many times order of magnitude improvements can be made. Many programs struggle to attain the 5% or 10% improvement – reducing call center volume by that amount would be considered a huge win in a customer support environment.
I question what is possible in this framework – even before considering what is practical. Digital transformations make these types of attempts but even modest improvements are sometimes beyond reach.
I agree that these are aspirational goals. But a great deal of blocking and tackling needs to still be done to move from “acts of heroics” in serving customers to building the digital machinery to streamline and automate experiences – both internally and externally – to achieve even modest goals.
Can born digital, clean sheet approaches achieve this? We have already seen that they can. But then can those models again achieve another order of magnitude of improvement? One can never say no. The question is how and at what cost.
When I turned sixteen, I badly wanted a car. I passionately outlined to my parents the 3452 benefits that would accrue to our family if I had my own car. Like 90% of my high school class, I did not get a car. ‘
When my granddaughter turned sixteen, she followed my same sales pitch–passion, sincere desire, tons of benefits to all of mankind. She got a car. When I asked her how many of her classmates had cars, she assertively replied, “All of them.” The variable impacting my outcome versus hers was the fact that my parents could not afford to furnish me a car; her’s could. It is easy to say “no,” when “yes” is not an option.
We live in a era where “everyone” has a car, so to speak. Coupled with the competitive desire to win the hearts of customers who can afford what is offered, smart companies rise to the challenge and elevate our desires, then raise our expectations. Bottom line, your choices are to lose and leave the game; play just well enough to stay in the game, or win by responding to customer expectations, whatever they may be. If you don’t respond to your unreasonable customers, your competitors certainly will.
The Adam Morgan video is powerful. Don’t miss the fact that it is over five years old…yet, still very relevant, maybe more so today. The victors in the marketplace of the future, as Makesh so well states, will be those that embrace unreasonableness as their competitive strategy. As the founders of AirBNB would ask, “On a 1 to 10 scale, what would a 13 look like?” We have reached the limits of succeeding through incremental improvement. Success today requires reinvention with an eye toward radical change and revolutionary strategies. As your customer of the future, why can’t you read my mind and give me precisely what I want without me having to ask?
Well said Mukesh, and I enjoyed the way you framed the concept of “unreasonable.”
When we simply wait for customers to become unreasonable, our success will be found through responsiveness and agility. When we focus on seeking barriers to break, that success will find us first.
We should take pride in creating more unreasonable consumers than the competition. Unreasonable consumers stretch our imagination and challenge us to change our assumptions to disrupt ourselves to achieve 10X growth. So the unreasonable becomes the next norm. If your methods are outdated and your technology is old, this becomes a vicious cycle ending in a slippery slope to extinction. This is one of the reasons why so many Fortune 500 companies have disappeared from the list in the last 20 years. If you constantly update, upgrade and reinvent, this is a virtuous cycle that brings progress and has the potential to keep you on top of the game to become an exponential organization.
Thanks for sharing your in-depth insight. You are spot on when it comes to your argument about sustainability of these improvements. However, if we look at this from the consumer’s perspective, once the bar is set (by whoever), the bar is set. Even the same organisation, after having set a certain standards, if they are unable to meet them, will find themselves in a position where their consumers might start deserting them.
Now, specifically to the case of Netflix, the challenge they face around drop in subscribers is to some extent a response of their customers to multiple trends:
– Netflix got a bit carried away and increased their subscription price, assuming that their customers will come along. Maybe they got their calculations wrong when it comes to the price elasticity for their product.
– The entire market is now overcrowded and fragmented, with almost all streaming providers resorting to exclusive content. IN my opinion, this will hurt everyone one of these players as consumers might not want to subscribe to all these providers. So they will prune and depending on their choices, all the streaming providers will face some drop in their subscriber numbers.
– On top of all this, with the pandemic slowing down and organisations expecting their employees to come back to work in the office, the overall time that consumers had to watch content on these platforms is plunging and hence consumers might want to prune the number of services they subscribe to.
Irrespective of all of this, having high quality content pipeline is crucial for every one of these streaming service providers. If I don’t see something new every time I login, I would want to cancel that subscription. That is the unreasonableness that I am talking about.
You are also spot on when you share that even creating and sustaining a 5-10% improvement usually proves to be difficult and hence going for a 5 or 10x improvement might be too much of a stretch. Here I strongly believe what Porus Munshi (Author of Making Breakthrough Innovations Happen) shares – When we are trying to improve something by 5 or 10%, we typically end up working harder or trying to improve the efficiency of what we are doing. However, when we attempt a 5 or 10x improvement, we know that it can’t be achieved by improving efficiencies. So, we start looking at all the other ways possible. We extend our horizons and look outside the box. In a way, we start questioning some of the assumptions that hold us back and therefore could potentially release significant innovation potential. Is this easy? Definitely not. Is this possible? Definitely possible. There are many organisations who have done this. Porus talks about 10 such example in his book. There are countless more examples.
Bottomline is – once consumers experience something great, that becomes their baseline expectations and irrespective of whether we like it or not, we need to figure out a way to meet or exceed those expectations, irrespective of whether we are a digitally native organisation or a traditional organisation.
Thanks again for your insights… Let’s continue the conversation.
Thanks Chip, Shaun and Carmen for sharing your thoughts and insights. You all make some very interesting and relevant points that move the conversation forward. I really appreciate these comments.
Mukesh, it is a great point that you raise/revisit. Are customers unreasonable? Like most things the answer is not clearly defined for me at least. Innovations have made our lives as consumers easier and yes; these new conveniences have altered our expectations. Some innovations take off, some fizzle. I agree that those organizations that push to be better and to anticipate future states are stacking the deck in favor of success. My organization, ENGINE Insights, exists to future proof business practices and experiences which means I live this daily.
While helping my clients to create the best possible version of their organization now and in the future, I always ask about the target customer. In the theme of this conversation, we can tell organizations to be unreasonable defined as, never stop challenging your organization to innovate, improve and grow. The goal here is always to better tomorrow than you are today. However, we need to design with appropriate and safeguards that keep in step with the desires of the customers for whom we are creating new experiences, services and products.
The odds of survival and growth are stronger among those organizations that:
1. Stay true to their brand promise
2. Stay true to their customer base
3. Know their targets and understand what matters most to them
While keeping this top of mind, I advise our partners to expand with purpose and mindful planning. This becomes exponentially easier when we seek guidance from current and prospective customers and embrace the reality that we cannot be all things to all customers. Remain relevant and profitable by choosing the path that offers the strongest ROI. It is by default the path that satisfies the customers who are responsible for the largest portion of your revenue.
Finally, I encourage open communication with customers and the market. This helps to minimize the animosity that I sense is an underlying theme to calling customers unreasonable. The solve, in my opinion, is to explain if something truly is unreasonable and share with customers why it isn’t possible. Transparency, when presented compassionately, allows companies to become more human and drives a deeper emotional connection which is at the heart of creating a customer centric organization.
Thanks for sharing your insights and perspectives Nicole . You make some very important and relevant points (about knowing our customer truly well and staying true to our brand promise). When I (and I assume Adam, in his presentation) talk about unreasonable consumers, we are not by any means calling in any kind of animosity towards the consumers.
I am a consumer myself and I am pretty sure that I am unreasonable when it comes to many things in life. I get frustrated when something doesn’t work well the first time. I get frustrated by bad design. I get frustrated if I have to que up for anything. So, when referring to unreasonableness of consumers, I believer we are talking about these frustrations and what they can lead them to do (leave or shift brands?).
I understand the importance of keeping the RoI of any initiative in mind and not get carried away in providing experiences that can’t be repeated or scaled at a cost that is reasonable. This is an internal operational matter for the business, which the consumers don’t really care for. What they care for is being served as well or better than their past experience in a similar situation and done so consistently.
All the points that you make about the importance of conversation and communication is extremely valid and important. There are times when open, honest communication about why a particular business can’t provide experiences that their customers expect can move them in the short term, but, in my opinion, in the long run, it will always matter to the consumers and they don’t necessarily forget or forgive. This is just my belief based on my experience both as a marketer and as a consumer.
Thanks for keeping the conversation going and sharing all your insights and experiences.
I think Mr. Morgan made some good points in his video. There are a couple of thoughts I’d like to share:
1. The rhetoric bothers me. The definition of unreasonable is “not guided or based on good sense.” In his video, Mr. Morgan has twisted the meaning somewhat, and made unreasonable somehow seem aspirational. I don’t share that conclusion. Customers and business leaders can be dissatisfied. They can be unaccepting of the status quo. There are many words and phrases that compellingly describe the unsettled human feelings that typically fuel innovation.
2. I believe increasing consumer expectations are a manifestation of changes in society. Notably, the ‘democratization of luxury’ – that is, goods and services that used to be accessible to the very wealthy are now available to the middle class. Widespread availability of consumer credit has significantly driven that trend. Couple that development with social media platforms that enable anyone to vent product complaints to the world from his or her sofa, and you get the phenomenon of the unreasonable customer.
3. A characteristic of innovation is that it occurs by combining what is already possible in ways that have not been done previously. Therefore, a defining characteristic of innovators is belief in what’s possible, which to me is the antithesis of being unreasonable – at least if you hew to the dictionary definition of the word and not to the Mr. Morgan’s hyperbolic meaning.
4. Living in a consumer society causes many of us (including me) to overlook the fact that our demands for high product quality, high-touch customer service, and hyper-fast delivery are not shared by millions of people in the world. In Somalia alone, for example, 4.5 million people have been directly affected by drought and 700,000 people have been displaced. The war in Ukraine poignantly reminds us that our ability to be unreasonable consumers is not universal. It’s vital to remember that being unreasonable is out of reach for so many.
Thanks for sharing your thoughts. I totally agree that the rhetoric by Adam and to a large extent the post that I have written is mostly applicable for the fortunate few of us. And we need to be grateful about this. The trends you speak about (democratisation of luxury, easily accessible consumer credit, social media fuelled FOMO) have all driven consumer expectation significantly.
While I can’t speak of the situation in Somalia or for that matter in Ukraine, as I don’t know anyone in those countries, I can speak about the folks in my home country – India. There was a time when the lower middle class or even the lowest earning part of the society was not demanding much. However, in the past decade, I have seen their expectation from brands have gone significantly up as well.
They now regularly reject sub-standard products. Their expectation of value for money is even higher than that of the so called middle class, because it is that much more harder for them to earn it and they only have a little to spend. This has actually helped in many ways. They now have access to smart phones, and through them able to connect to the internet and see what is happening around the world. They are no longer happy with hand me down or outdated products to be sold to them. They demand (through their purchase behaviour) that brands create products and services that are tailored to their needs.
So, while I agree to the language used by Adam (and myself) might be extreme (and some might consider it hyperbole), the meaning behind it is that consumer expectations are rising all the time with every experience. And it is important for businesses to not fall behind and continue to out-pace the consumer expectations if they want to thrive in the times to come.
Just my 2 cents. Thanks for continuing to carry forward the conversation and sharing your very valid perspectives.