What can Trader Joe’s Teach us About Customer-Centric Product Development?

BY Keith Fenech ON NOVEMBER 29, 2018

In talking about how a product goes from idea to shelf on an “Inside Trader Joe’s” podcast, Matt Sloan, the VP of Marketing Product for the neighborhood grocery store chain, tells the story of his visit to Canada years ago, to a factory which made soup to be sold in frozen “pucks”.

Sloan wondered whether other products could be made in the same way. Steel-cut oatmeal was a very popular breakfast at the time, but it takes more than 45 minutes to prepare. So Trader Joe’s and the soup company tried cooking steel-cut oats with the equipment used for soup, and then packaged it in the little frozen pucks. The result? Steel-cut cooked oatmeal that was ready in just three minutes, still a popular product at Trader Joe’s today. “It’s often best for us to get out into the world and not just wait for things to come to us,” Sloan says.

Know Your Customers’ Problems

It’s product development like that – that seeks out innovative solutions rooted in intimate knowledge of customer’s problems – that has earned Trader Joe’s the reputation as one of the most customer-centric organizations on the planet. The staff taste everything they sell (even the pet food is tested by their pets), and an effort to get close to the customer, to see and solve their problems, underpins everything the store does.

As software product vendors, we don’t have the same opportunities to drive this customer centricity – at least, not in the same way. Because our reality is that even the geekiest of our customers may have trouble mustering the enthusiasm for the CAD software equivalent of tasting Trader Joe’s mandarin orange chicken.

A sign at Trader Joes offering a collection of their recipes

It’s from this reality that we must approach customer-informed development, and, most importantly, how we get our information. But when we’re getting out into the world of our customers, we’re taking time away from their jobs. We therefore need our methods of asking them for information to become organic to the process of work itself.

We Expect Users to Come to us With Feedback

Another factor which counts against us is that our feedback collection strategies are rooted in the expectation that customers will come to us. It’s why our traditional channels – from user surveys to even customer forums – fall short of capturing the whole story needed to drive customer-centric product development. Our traditional channels can’t provide real-time feedback while the user is leveraging the application and able to share their most honest and relevant responses. And they can’t guarantee that we get to the actual end user, as often our conversations happen with someone in IT and/or a main account contact.

But supplementing your feedback collection strategies with a messaging framework can give your team an effective way to open non-disruptive customer communication channels, and ensure that the information you receive is accurate and timely.

Segment Your Audience

By combining an in-app messaging strategy with usage intelligence, product management and marketing can segment a software product’s audience and ask targeted questions about very specific pieces of functionality.

Consider the power of a simple “thumbs up, thumbs down,” survey when it’s integrated with data on usage. Marketing can contact users who leverage that functionality, and their responses can allow product management to drill deeper into the computing environments and habits of those users.

They can break down attributes according to ratings, and draw even more information from that. Was a happy user running a newer browser version than an unhappy one? Did their machine have more memory? Did they use the functionality for longer than someone who gave it a thumbs down? These are all valuable insights that can lead to developing functionality that users love.

CNC Software, developers of Mastercam CAD/CAM software tools took this approach for the redesign of a user interface that had stayed the same for nearly 10 years. After considering several alternatives, CNC Software chose a Microsoft-style ribbon interface. That’s when the hard work started.

According to Director of Product Design, Russ Bukowski: “Now it was critical to figure out how to organize our 1,200 features. How do we logically group them? Which are most used? Which should we promote? Software usage analytics gave us the usage data to say: these features are used most often, these go together, these are the ones to promote. Our entire redesign took 18 months, but it would easily have taken double that time without runtime analytics to support our decision-making. We would have been forced to spread the interface project across three releases. We’d have been stuck in a constant loop of sending out beta after beta.”

All About Value for the Customer

While there are big differences between the consumer packaged goods world of Trader Joe’s and developing software products, the goals are the same: delivering products that delight customers and creating long-term customer value. Getting closer to your customer and listening to their needs is critical to both. A data-driven in-app messaging and usage analytics strategy can form part of a strategy to get out into the world and listen to the voice of the customer, instead of waiting for ideas and problems to come you. Immediacy and agility can become anchors in the product development process.

About

Keith Fenech

Keith is Revulytics’ VP, Software Analytics and was the co-founder and CEO of Trackerbird Software Analytics before the company was acquired by Revulytics in 2016. Following the acquisition, Keith joined the Revulytics team and is now responsible for the strategic direction and growth of the Usage Analytics business within the company. Prior to founding Trackerbird, Keith held senior product roles at GFI Software.

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