Your business needs to grow. There’s only a certain amount of growth you can get from the customers you have. Odds are you need new customers. And if the new customers look different from the current customers, you’ve got a pretty big gap to bridge. You’re in a bubble, and you need to get out.
What happens in your bubble?
Inside the bubble, people tend to naively over-optimize. You iterate and iterate based on the feedback in front of you. That’s how you wind up with the best possible gasoline-powered car, but end up getting dominated by an electric car. When you optimize for what you already have, you run into two problems:
- You’re only getting feedback on the thing you’ve already built.
- There’s a reference point to which all the feedback is attached. There is a finite number of customers you have, and you’re wearing blinders to all the customers you don’t have.
How do you burst your bubble?
The first step to fixing this is to make sure you know you’re actually in a bubble. Say you’re a high-fat, delicious, premium ice cream company. You could reasonably say, “Nobody asks us for healthy ice cream.” That would be true, because anyone eating your ice cream clearly doesn’t want a healthier version, or they would have eaten something else. But the absence of evidence is not the same as the evidence of absence. Product teams need to understand you can’t just optimize for the feedback you already have.
If you’re in a regulated environment, there are not a lot of ways you might be able to talk to consumers and put things in front of them. You typically rely on third-party research and Google searches and news, and just looking at the competition. The problem with looking at the competition’s website, though, is that they’re in a bubble, too, and everyone always creates the illusion that they’re killing it, crushing it, and doing great on their website, plus they have every feature under the sun. Just as your own website is slightly exaggerated, so is theirs — you just don’t know which things they are exaggerating.
There are many problems with relying on hearsay to get outside the bubble. Maybe it’s better than nothing, maybe it’s not. It’s really important to get firsthand evidence outside your bubble, and to use a platform or a capability where you can actually go speak to communities and audiences to which you didn’t previously have access.
This gets you a lot of things. You’ll see both opportunities and risks you didn’t understand before. You’ll see there might be adjacencies that make a lot of sense for your business. To come back to ice cream, you might see that, oh, you don’t have to make a cauliflower-based ice cream; you could just make a slightly lower-fat ice cream.
Can bubbles be too comfortable?
Public companies tend to stay within their bubbles. If your revenue always has to move in one predictable direction, it is very, very difficult to take a long-term view, especially if it might cannibalize the business you have. And that’s precisely how you beat quarter after quarter in an industry being disrupted (say, satellite television) until one day you “suddenly” lose 50% of your market cap or go bust.
Beyond that, companies stay in bubbles, because they’ve been successful to date operating on leadership and vision. They think the future will be a repeat of the past. Second? Exactly the opposite: You know you’re in a bubble, but you make assumptions about what outside the bubble looks like. That’s what leads Google to build Google Plus and kajillion other tools nobody wanted.
What if you’re not actually in a bubble?
I see a lot of the opposite, too. Many businesses assume they’re in a bubble they’re not actually in. They assume there’s this huge opportunity out there, they go in with pistols blazing without talking to any actual potential customers in the space, and it turns out they actually weren’t in a bubble to begin with. They just fell for hype.
Google does this a lot. Google is a great company that makes a ton of money from ads, but it is obsessed with building everything beyond ad and search products. They’ve killed more than 200 such products, because they have this assumption they should be chasing these seemingly great market opportunities that either don’t exist or are just so far outside their domain that they can’t effectively execute. It happens both ways: companies that find they legitimately are in a bubble and could find other really relevant opportunities to grow, and companies that are not legitimately in a bubble, but they don’t know it.
Understanding how to navigate bubbles in a key to business growth. And the key to that understanding is talking to those outside your bubble.