Hey, Rob, welcome back man. How you doing?
Good, good, good. It snowed yesterday.
I hate everything. No snow here in Mexico City.
It started, we're entering the six week period in which it
becomes intolerably hot, but eventually it'll just start
raining. But anything, anything new going
on or we do we want to jump into QuickBooks and causes and
benefits. Yeah, let's.
I can't think of anything, so let's jump in.
OK, cool. Well, this week we're talking
about your sub stack, cause versus benefit, the difference
and why it matters. We're going with a simple and
direct approach to this cars and I think incredibly practical.
We'll jump into an example from QuickBooks here in a moment, but
why don't we start with you know who?
Why is this on your mind and who's this one for?
Yeah. So, so this one, I've actually
had a lot of start-ups coming to me recently who've gone through
like product positioning exercises and come out with
something that is logical and doesn't work and not they're not
sure why because it makes so much sense.
And so I've been struggling to articulate this and articulate
the difference between there's good product positioning
exercises, which you, you see from product marketing people.
And there's sometimes there's really bad versions of it and
they're really bad because they sound like they should work and
they make a lot of sense in the words seem smooth as a result of
them and they just don't work. And so I've been racking my
brain as to how do I articulate the difference here.
And so the cause verse benefit angle I think is a useful frame
on this. Yeah.
You know, when I was reading this post, I was thinking about
all the, you know, things that you might see on LinkedIn or
that we've seen on Twitter or X over the, you know, over the
months and years that are like, I only fund businesses that
solve a revenue problem or I only fund businesses with a 10X
ROI or, you know, you know, whatever that finishes.
And I and I, I think what you're doing here is saying like, OK,
ex post afterward, you can identify that some businesses
that took off had that benefit. However, what we want is, you
know, I'm just being a, you know, a broken record for things
that you talk about. But what we want is day zero
before you have taken off, understand what is the thing
that will cause, you know, 'cause the start up to take off
and and really like shedding away all of the other confusing
things. Why don't we Rob I, I'm going to
start with like what you wrote about this and then I want to
jump straight into jump straight into the QuickBooks, QuickBooks
example because it makes it highly practical.
You wrote at the start when anybody buys anything, they buy
the, they buy the thing because they are in a specific kind of
stuck situation. They're trying to do something,
but they are blocked from doing it by their existing tools,
methods, options, etcetera. Given this, they are looking for
a thing that unblocks them. This is what causes a purchase
and it tells us exactly how to describe our product and its
value. It's very simple, but when
someone buys something, they also get a bunch of other
benefits like value ROI from it. They may use a variety of
different features, all of which provide an array of different
benefits. After they buy, they explain
that they what they like about the product based on these post
hoc benefits they received after they purchase it.
And then I, I think that's kind of the the crux of it.
Is there anything you want to add here on top of that or do we
want to jump into the example? Yeah, I think, I think let's
jump into the example because it makes it a little bit clearer,
because the challenge is always, how do I make my startup take
off? I have to say some words to some
person and show them something that causes them that like fits
with something that's happening in their brain that causes them
to RIP it out of our hands when that is not the default state.
Usually the majority of words and concepts and visuals they
see just default state. They just kind of go on by it
just passes through and they keep doing what they were doing
otherwise. And so we need some sort of a
model for what sticks and what situation does something stick
that helps us know what to say and and why people buy.
And so the example I want to go to here of, of why this gets
super confusing is an example that I was talking with Bob B
Moesta, you know, goes by Bobby, which I assume we're both named
Rob or Robert. I've changed my name like 40
times. I don't know if you have.
Well, I went to RC because it was getting too conf.
What was happening was it was too confusing when we were both
responding to emails as Robert, Robert, everybody was like what
is going on anyway? So Bobby, Bobby and Moesta I.
So I went. I went by Robbie for my entire
life until my first Kinsey interview and they said you're
not Robbie anymore, you're Rob. And so that's why I'm Rob now.
Rant random aside, I had a beard when I was at Bane, you know, as
a 23 year old analyst because they told me it it looked, I
looked older and they were like, this is not about you Robert.
Like you have to show up with a beard.
Not really proud of that. But yeah, shows you the strong
character I bought anyways. So Bobby Moesta.
Yeah. So, OK.
So Bobby Moesta, I was talking with him and, and he was telling
me the story about when he helped QuickBooks out.
So I don't know if you know QuickBooks, but it's like
accounting software that basically does a ton of things
and it's kind of always done a ton of things.
And so the question is like, how do you get people to buy them?
Or how do why do, why do people buy QuickBooks?
And so the traditional way that we're taught to think about
describing a tool like QuickBooks is from the supply
side. It's, it's basically it starts
with what is the product do, what are all the pieces of it?
And then you might ask a question of like what's
differentiated about it versus the alternative?
What differentiated value, what unique value does it provide
versus the alternatives? And from that you say, OK, then
who cares a lot about those differentiated benefits values
And therefore what do we, how do we describe that's coming from
the supply side? And so if you do that exercise
with QuickBooks, it's probably there's a bunch of different
things you could come up with, but it's something about it
being this all in one platform for small businesses that can do
everything right. And that that's what makes sense
from the supply side. Bobby told the story though,
that whenever anyone bought QuickBooks, though, there was
only one cause of them buying, which was basically I need to
send or receive money. And so if you describe
QuickBooks in the way that it is an all in one accounting and da
da, da, da da software in that situation and you advertise it
that way, they're not going to buy it.
You're going to have a super compelling, logical way to
understand, to like describe your product that is
differentiated, that has very tight messaging and it's just
going to, yeah, wash on buy. And so instead, and you can see
the still today on Quickbooks's website that there's like AI
didn't even cut out this section.
But like the key things they highlight is you can send money
or you can receive money, get paid, whatever, right?
And that's how you get people in.
And then after they are in, they run into a bunch of other things
that the product also enables them to do.
But we can't conflate the cause of them buying with all the
other things the product does and all the other benefits they
get out of it. Because if you look at it from
that, from that view, you're going to wind up with a
description of a product that does not work, that does not
cause you to take off. Yeah.
And so it feels like there's two things going, going on here. 1
is we make that often make the mistake of a supply side start
like this is what our product does.
And 2nd is that irrespective of what your product does, you
describe things that are not causal and what they, what is
going to lead them to purchase. So even if you weren't, even if
you weren't taking a supply side approach and you were talking
about the demand side, you could, the QuickBooks could
still describe the many things that they do and overwhelm the
customer, the potential customer with with that.
Yeah. And like I was another example
of this is I was listening to a startups recorded sales call and
the customer, the potential customer bought superfast.
They described probably 14 different benefits of the
product. It'll save our team time.
It'll enable us to scale without hiring further.
It will dot it at it like all these different benefits, but
those benefits are not necessarily the cause of them
purchasing. There are so many benefits that
every business so much value, so many high ROI opportunities that
every business has available to it at any one point in time that
they are not actively prioritizing.
And so we have to focus on the situation when somebody is
trying to accomplish something but blocked because it's the
only cause of a purchase. This actually reminds me of like
payroll when I was starting my business and I had no idea how
you start a business. And I was trying to figure out
payroll and I was the only, really the only thing I was
worried about was the business eventually getting shut down
because of non compliance with some tax regulation.
And I, I kept asking, you know, I kept reaching out to these
like payroll and HR providers and they were, I was over like
just overwhelmed by everything that they were, they were
demoing and everything. And eventually I just like sort
of figured it out and was like, OK, this I, I think I can do
this. But if they, if somebody early
on would have come to me and said like, look, if you're
starting a small business like these are the two things you're
worried about, I would have bought like immediately because
it would have taken that, you know, taken that concern.
Yeah. And like at that situation, it's
basically I need to pay my employees in a way that's
compliant. Yeah.
That's like, that's literally it.
And if they said that, cool, that's how you get in and then
you run into other things once you're in there, but you can't.
But what they're doing is they're conflating the fact
that, Oh well, we have a all in one payroll IT da da da da the
platform. And so therefore, we need to
tell you all about it and tell you why it's different.
Yeah. And you're there just like,
listen, I'm literally just trying to send.
Money to exactly, Yeah, yeah, exactly.
Cool. There's a couple implications
that you highlight in this one. We've we've touched on these,
but just to just to see if there's things you want to add
here. 1 is it makes it very difficult for us to describe our
product. And then 2 is when we describe
our product based on benefits, it doesn't work very well in
practice. Anything additionally you want
to add to to those rub? Yeah.
So, so it actually is like a super complex thing to try to do
if you try to go come from the supply side because there are so
many different angles that you could look at.
Oh, it could save time. It could do that a bit like it
has all these different features, we can combine them in
different ways. And so that's like really,
really, really difficult to do. And then at the end of it, after
you've done this mentally grueling work to come up with
something, you show it to customers.
And, and here's the worst part is they understand it.
They understand it. They will nod their head,
they'll say, wow, that makes total sense.
I totally get it. And guess what?
They're not buying. Yeah, because why would they,
right. Like the way that you were
describing your product does it. And you might, it's like, here's
the hard part is that you might then like QuickBooks might say,
oh, the all in one, right? Like accounting da da, da, da,
da platform. And then they could work from
there to problems and pain points from that perspective,
which they will come up with problems and pain points that
people have and don't act on. Yeah.
And so they'll come up with it's frustrating to manage things
across a bunch of different tools.
It certainly is. It certainly is.
Isn't it painful logging in and logging out and and having to
copy paste things? Oh, it's the worst.
Yeah. We offer an all in one solution.
It's like, OK, cool, great, thanks for I just need to get
paid. And so I'm going to go and find
some way to get paid, right? Like that's and, and and like
that's what winds up happening as a result of this.
And so the the end result of all of this is we wind up doing a
ton of work, a ton of mental exercises, mental gymnastics to
come up with something and become two ships passing in the
night with our potential customers.
Yeah, yeah. Having having wasted more of my
life than I care to own up to creating slides that immediately
like disappear because I took the wrong approach here.
I can. I can vouch for that.
Rob, how do you how do you find that causal element?
Let's say, you know, a founder listening is is thinking, OK,
like I've been talking about benefits.
I see that I'm done. You know that that's the wrong
approach. How would you?
How do you advise founders that are like, OK, how do I actually
find the causal thing? Yes, it's going to depend on
what stage your business is at. If you're a bit, if you like a
bunch of people who've reached out to me recently read millions
in revenue and you've grown kind of fast, but it's kind it's like
not soup. Some people buy fast, some
people buy slow. It is in the people who buy
fast, especially if they come back, they ghost you for six
months, come back and buy fast. You figure what changed, what
came on to your to do what? What about your situation
changed that caused you to try to do something but but you were
blocked from accomplishing it from your existing options,
right? Like it's, it's really, really
helpful to go back and look at your existing customers way
easier if you have existing customers and some of them have
bought fast, some of them haven't.
Other than that, if you are in a situation where you are trying
to figure out what people want, first of all, get off the supply
side. Just stop thinking about
products and just focus on situations where people are
trying to accomplish something and blocked.
And you can see that by going and watching them do their do
their job, doing their job alongside them or asking the
question, what would you pay me to solve for you?
What would you pay me to take off in 3rd plate?
And what they'll tell you there is or you know, what are you
trying to buy right now? You can even, look, I got a
message from a founder this morning.
He was like, yeah, I just started asking that question in
sales calls and it got way clearer.
And I sold something and it's like, yeah, great.
And because what they'll say is, yeah, I'm trying to buy
something that's going to, or I'm going to try to, I'm trying
to buy this kind of product and they give you some sort of
supply side mess. I'm trying to buy an AI agent
for da, da, da, da. OK, cool.
I don't know what that means. So maybe let's jump to the
demand side. I know you're trying to buy
something here. Jump to the demand side.
Explain to me what you're hoping to accomplish, why you can't do
this with your existing tools and solutions.
And like, OK, based on that, can I sell you this?
Yeah, yeah, the IT, it feels like a couple targeted
questions, but it's it's not inaccessible.
It's just like the way that you approach the conversation
frequently unlocks it. I like your point on when they
when they buy fast figure out why.
Like that's the the gym is in there frequently.
They won't even tell you though like if you don't ask like.
Or they will. Or what they will say are things
that are benefits, they're not causes.
And you can get wrapped on around, act like what we're
looking for is not something that's in the product.
We're looking for something that's in their world.
So how does that conversation look like?
What let's say they say like, well, we, we looked at a couple
competitors and you all's, you know, we, we liked your
interface more than somebody else.
Or you know, something like what if they get, they give you a,
they, you ask why they buy, they give you a supply response.
How do you interrogate that? Yeah.
So, so in that case, it's like, cool, let's maybe zoom out from
the competitors, the the products.
Why did you like tell me about when you prioritize this, when
you decided that we need to start looking into these
options? What was happening in your world
outside of the products? Yeah.
What changed? And right, so and of another
type of customer that buys, which is the one that goes to
for six months and then shows up and buys in a week or in three
days or something like that one, it's typical.
It seems very clear, like they know what was going on and they
can specifically pinpoint it frequently.
Yeah, yeah. And they, and even then they
might say, OK, like I got approval to work on this
internally, right, which is not helpful.
And you have to like zoom out from from that kind of like very
narrow thing to be like, OK, but why was this the relevant thing
internally? What was happening?
Yeah, I love it. Well, Rob, let's let's wrap up
this bite sized episode. Any anything else you want to
add here before we wrap? The framework is simple, trying
to accomplish X but blocked because of Y.
This It might feel like a straight jacket, but it is for
our own gun that it is a straight jacket.
I love it. Yeah, I've got, I've got some
messages that I'm going to be thinking about that with later,
later today. You also have your next boot
camp that we're calling it physics of sales boot camp.
Is that is that right? We're calling it the next Boot
Camp. Yeah, the the artist formerly
known as known as PMF Camp, whatever it might be coming up
on May 4th still have still have slots with that if I'm not
mistaken. So links will be in the in the
show description with that, Rob, if there's not anything else, we
can let folks go. Let's do it.
All right.