Archive for October, 2002

The Refrigerator Test – Make Yourself Indispensable To Your Customer!

BrokenFridgeThe other day, we accidentally came up with a simple, new product development test. See, our refrigerator broke. Food spoiled. Sleep was lost. Teenage boys got really, really hungry. It was bad.

In the thick of shoveling ice into coolers, Ann recalled a line from “Big Yellow Taxi”, by Joni Mitchell:

” Don’t it always seem to go
That you don’t know what you’ve got ’till it’s gone…”

To a person, our family has a new appreciation for that big, humming box in the pantry. Thus was born the “refrigerator test”. Try it out yourself, right now: Is your product or service as essential to your customers as a refrigerator is to the modern family?

MEASURING HOW INDISPENSABLE YOU ARE:

Try the “refrigerator test” for each of your offerings. Interview your best customer, a prospective customer, and an ex-customer, and explore the following topics:

  • Would your customers miss your product or service if you suddenly took it away from them? Would they barely notice, or would they be screaming for it?

  • If the impact would be significant, how will it impact them? What price – hard and soft – would they pay in its absence?

  • What would it (or did it) cost them to SWITCH to your product?

  • What would (or did) it cost to switch to a competitor’s product or service?

When we put business leaders through a similar exercise in our strategy sessions, they quickly gain a new understanding and command of their business – from product development to competitive analysis to marketing and sales. Let’s see how the fridge test impacts our thinking about our market…

DISCOVERING SEGMENTS IN YOUR MARKET:

Talk to enough customers (and ex-customers) and patterns emerge. Different segments of the market put different value on features – price, reliability, distribution method, and so on.

Take our refrigerator example: as a bachelor, it would take days for me to notice the fridge was dead. I would have shopped for “cheap” and “reliable”, skipped the icemaker and would have been fine with one-week delivery.

Fast forward to life with two active teenage boys with insatiable appetites. We knew within minutes the fridge was in trouble. We went for reliability, capacity, and a crushed ice dispenser. Oh yeah – the guy with the low price but 10-day delivery lost our business.

Now go back over your customer segments in your mind. Sort them out by why they buy. Then, treat them differently! Change the messages, promotions and perhaps even models to reach deeper into each market segment with your advertising and development dollars.

CONCLUSION:

So that’s why we think the “refrigerator test” is, well, cool! It helps you understand why they buy. It helps you see how people think about your product and service – and how to keep them. It helps you see them not as a mass, but as groups or segments each responding to a different message. Most important, it helps you enjoy business success, long-term.

And how cool is that?

© 2004 Gary Ralston

About the author: Ann and Gary Ralston founded Ralston Consulting Inc. in 1997 to help accelerate business growth for their clients – from startups to global corporations – across North America. They live in Columbus, Ohio with two teenage boys, a wonderful dog, and a new refrigerator.

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