Three reasons you don't have product-market fit
How motivation and ability influence adoption of your solution
Last week, I had a strategy session with a startup that is about to pivot. Before, they launched and shipped their SaaS to 3 SMEs, paying customers.
It’s a manager and employee engagement tool consisting currently of 2 modules (defined by features), for two different jobs to be done.
One module helps managers in planning and managing the feedback cycles and action points for their 1 on 1 conversations with employees. This module is used broadly and people love it.
The other module, which focuses on employee engagement, is not used by 2 out of the 3 customers. Even when the customers mention that they recognise the potential yields of engaging their employees.
Why is that? To explain that, you need to have a mental framework on what moves us.
Action comes from motivation & ability
As a startup founder, you should try to build a theory of why your (potential) customers behave the way they do, or more importantly: when they don’t do anything.
The Fogg Behavior Model (above) can help a lot with understanding why some people don’t act i.e. don’t use your solution.
The main premise is:
People act when motivation and ability match
What does that mean? High motivation can compensate for low ability and vice versa.
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Areas of instant action: extremes
On this framework, we plot all possible ideas for actions. Not all ideas for actions are executed.
Within this framework, there are areas of instant action: highlighted with areas 1 and 2.
Very high motivation requires zero skill
Example: I’m very motivated to do my taxes, even though it’s difficult, I’m not good at it and costs me a lot of effort. Yes, we do it, even though we feel we are not motivated, we more or less always do it. Different type of motivation: fines or jail time. Works.
Very high ability requires less motivation
Example: I’m very good at crafting memes on LinkedIn, so even on days when I’m not very motivated, I still do it because it takes me very little effort. And boy are they fun.
Areas of instant inaction: extremes
On the other side of the coin are areas of instant inaction: nothing happens. Highlighted with 1 and 2 in the above visual.
My motivation for the task at hand is so low that not any ability will be able to overcome this.
Example: I don’t want to eat healthy, so not a single application will make me so, even though the app makes it very easy.
My ability for this task is so low that not any amount of motivation will make up for it.
Example: I’m so bad at cooking that no level of motivation will make me go out there and cook a meal myself.
Three reasons of lack of product-market fit
Above are the archetypical zones of action and inactions. We can use these to explain lack of adoption, or lack of product-market fit.
Let’s return to our startup with the engagement tool adoption issues: People are not using the module.
With the Fogg model, we can hypothesise the source of this lack of action in three archetypical ways.
The motivation is high, but the tool is difficult to use, leading to the ability of the customer being too low → Inaction
The tool is easy to use, the customer is capable of executing the task at hand, but the motivation is too low → Inaction
The horror situation: the motivation is low and the tool is hard to use. → Extreme inaction.
How to increase product-market fit
These scenarios give you three strategies to overcome the lack of adoption and increase your product-market fit.
Make your solution easier to use, so motivated people will start to act
Motivate people to use your solution, so capable people will start to act
Do both 1 + 2 at the same time. This is very hard.
Verify the strategies with data
Now, these strategies are nice on paper.
However, without actual data, you shouldn’t commit to any strategy without some data.
First, do interviews with your customers on why they don’t use your solution.
The startup of the intro did this, with two questions in the back of their minds.
Can we make the tool so easy that low motivation is not an obstacle anymore?
On closer inspection, the tool itself didn’t seem to be the obstacle, as the team figured it was already quite easy to use. There were no signals of usability issues. Another customer was successful in using the tool, and the digital literacy of these users seemed similar. Onboarding also was similar.
Their conclusion: This doesn’t seem like a fruitful direction.
Can we motivate people to care about the task?
The other customer who did use the engagement module was a company with a different culture than the other two. The companies that didn’t use that engagement module didn’t have a culture where it was common to think about employees as such.
Conclusion: The team reasoned it’s very hard to change company culture, and therefore might not ever get these companies to use the module.
So both strategies suck, right? Well.
Pivot the market, not the product
There are two elements in product-market fit: product & market (duh).
Sometimes as a startup, you need to change your product or onboarding to increase product-market fit.
But sometimes, you need to shift markets to increase your product-market fit.
What the team learned is that these 2 companies are not their ideal customer for that engagement module.
Instead of trying to motivate these companies that didn’t use the tool and instead of trying to make the tool easier to use, they shifted and tried to find more companies like the other one that did use the engagement tool.
This is shifting your beachhead market to a market segment that values what you offer. Potentially increasing product-market fit.
In their case: organisations that have a culture that values employee engagement. They are now reaching out to those type of organisations over LinkedIn and email, landing problem interviews. The first signals are positive, and they are discussing pilots as we speak.
Summary
There are two components to product-market fit: product and market
The Fogg-behavior model can help you to understand why people are not using your solution
If your product is hard to use, make it easier so motivated people start using it.
If people are not motivated to use your product, you can try to get them to. This is hard.
In a lot of cases, startups can’t move the needle on motivation.
The ultimate solution is to move to a different market segment to increase product-market fit.
Insightful read, Jeroen! Nice model for determining the real cause for the inaction. I believe that you are spot on with the conclusion.
I would mention that if the customer is problem aware and solution aware and still doesn’t use your product or feature then he’s not the right fit.