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What Chief Customer Officers can learn from YCombinator’s approach to disruption

What do Chief Customer Officers have in common with YCombinator? They are both driven by creating products and services that people want.

Last week, I attended the Chief Customer Officers & Influencers conference in Atlanta. I got a chance to give a keynote on how companies can disrupt themselves through customer insights and this post summarizes some of the key points I made.

Disruption Silicon Valley – way

Coming to Atlanta from a YCombinator startup meant that I bring an interesting point of view to share with that audience:  Silicon Valley startups are constantly disrupting how we approach everyday tasks. Medium and large enterprises can learn from some of the specific approaches they use.

YCombinator, or YC in short, is the most famous startup accelerator here. In just 10 years YC incubated startups that are cumulatively valued over $100B dollars. Close to 100 companies are valued over $100M each. Its graduates, such as AirBnB, DoorDash, and Instacart, disrupt how we approach everyday tasks such as booking trips, ordering meals and buying groceries. In the B2B space, startups like Stripe disrupt how we think about payments, and Gusto has simplified something as complex as HR processes.

As YC graduates, we know their secret. Well, it’s not that secretive, because YC is the first to share their learnings via publicly accessible online courses, podcasts, blog posts, youtube videos, and tweets. But a lot of this content does not reach the Customer Experience community. I will share the points that we found the most useful, and also explain how Thematic can established companies to take YC’s approach to disrupt themselves.

Make something people want

YCombinator’s mission is “making something people want” . In order to understand what people want, YC urges founders to continuously listen to feedback and iterate, run continuous experiments to figure out what resonates with customers. Eliminating distraction is critical, so they always say: When you are not building product, you need to talk to your customers. That’s it. It’s a continuous process of iterating on customer insights. So, what are some of the strategies YCombinator founders use to build something people want?

Strategy 1. How to design exceptional experiences

If you have ever been to a CX conference, you know that there will be at least one session on this topic. The founders of AirBnB came up with an exercise that can help. This exercise is a brainstorming session to answer the following question:

“On a 1 to 5-star scale, what would an 11-star experience look like?”

Airbnb is known for not just listening to their customers, but putting themselves into their customers’ shoes and thinking about how to create truly transformative experiences that will create virality among customers. If someone stays at a strangers’ house, and everything goes smoothly, it might be a 5 out of 5 experience. But nothing special. A 6-star experience might mean a bottle of wine and chocolates waiting for you on the dining table. You’d say, “wow, it’s better than a hotel.” A 7-star experience might be your host booking a table for you at their favorite restaurant. An 11-star experience is Elon Musk welcoming you and arranging a weekend trip to space.

While a system such as Net Promoter Score helps you measure loyalty and virality, the 11-star experience exercise can help you re-imagine the products and services you are offering. Anyone can do this exercise. You don’t need to be in a startup!

Strategy 2. Leaders who listen to customers

Once you have ideas that might result in a truly viral response to customer experience, you can work backwards, by listening to what customers really like out of the ideas you came up with and implementing them.

For the AirBnB founders, this meant becoming photographers to highlight be beautiful spaces available for rent on their platform. Not only did they help create more beautiful listings, the founders met hosts in person and learned from them. Listening to customers and then innovating on how to design experiences that resonate is what drove AirBnB’s incredible growth.

So how can leaders in established customers achieve the same level of insight? Having occasional conversations are great for empathy, but aren’t meaningful enough to pick up valid patterns. So, at scale, individual conversations become anecdotes, and no-one trusts (or should trust) anecdotes. More on this below!

Strategy 3. How to ask for feedback meaningfully: Start with a Why!

YCombinator is always asking for feedback and their response rates are off the chart. This is my co-founder who happened to be my husband, and our two kids, when we took part in this program. YC asked us multiple times (via  two surveys, in person discussions and via a personal email) how they can make the experience better for their customers, the founders! They said that they want to see more women, more parents, more non-standard founders in the program, and therefore our feedback mattered. Of course, we responded!

Even though only a couple of hundred founders go through each batch each year, they make sure to analyze it in a non-biased way. In fact, YCombinator became one of the early customers of Thematic.

Why established companies are different

But of course, what works for a startup, won’t work for a medium to large company, or a huge enterprise mainly for two reasons:

  1. Listening to a handful of customers isn’t representative of the entire population of customers and can always be dismissed as anecdotes by others. And multiple departments want different insights.
  2. Decision making is done by committee and everyone needs to get on board with the needs of customers and the impact that addressing these issues will have on company metrics.

At Thematic, we already analysed customer feedback for companies, but after seeing how disruptive the YCombinator approach can be to growth, we asked ourselves, how can we enable medium and large companies to implement this customer feedback loop. We have built a customer insights platform that enables companies use their feedback as a strategic asset to enable growth and disruption from within.

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