There may never be a snappier explanation of the “jobs” concept than late Harvard Business School advertisingage_130x130professor Ted Levitt’s famous utterance, “The customer is looking for a quarter-inch hole, not a quarter-inch drill.”

Focusing on the “hole” rather than the “drill,” by understanding the fundamental jobs customers are trying to accomplish, is a simple but powerful approach to identifying what customers really want. Instead of concentrating on the solutions in use, a jobs approach looks at the fundamental problems customers are trying to solve in particular circumstances. It involves defining how customers are trying to accomplish those jobs in their entirety, identifying how they define success and analyzing what constrains them from doing the jobs perfectly. What does this kind of analysis reveal? That existing products or services are often unsatisfactory in addressing the jobs. That’s where the opportunity for innovation comes in.

A jobs-based lens provides a better way to segment markets and customers. Instead of sorting customers into groups based on demographics or behavior, the jobs process enables a more powerful segmentation scheme in which customers with common jobs and discrete priorities are clustered together, leading to the development of more targeted products and services that better meet a segment’s particular needs. Jobs-related characteristics are more deeply connected to the best possible solution than any other segmentation scheme.

“But wait,” you’re saying, “isn’t that need-based analysis?” It sounds similar, but there’s a subtle yet crucial difference between jobs-based and needs-based segmentation: A jobs view uses the customer’s circumstance or situation as its point of reference, while needs-based segmentation focuses on the customer—demographics, income, geography—as the unit of analysis. If you ask people what their needs are, they will tend to talk about solutions. With the jobs approach, you constantly ask “why” to get at the root cause that is driving their need, and thus the reason that a job exists. Insights garnered in this way are more unique and much more powerful than needs-based research, and the method drives innovation in a more actionable way.

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