Notes: Lovability by Brian De Haaff

I Read It So You Don’t Have To: The fourth of a series where I share my notes from readings in business, leadership, careers and self-help.

Building a business that people love and being happy doing it is a challenge and Brian De Haaff, Co-founder and CEO of Aha!, wants to bring us back to the way our grandparents operated businesses: building relationships, quality and value creation. Fundamentals are back in fashion again: people, service, relationships, transparency, trust. They produce results. Brian calls it Lovability and his company is proof that it works.

Our Current Reality

Dreams of personal wealth have given way to the reality that businesses built on hype rarely yield returns.

By focusing on manipulating perceptions instead of achieving meaningful goals, many entrepreneurs are crushing their companies and wasting potential.

The growing number of failed startups is collateral damage of the VC world’s home-run mentality.

Investors reason to be is finding the next unicorn yet too many investors refuse to accept that the unicorn is a mythical creature.

Technology is great but we have convinced ourselves that costly, annoying human interactions are not necessary anymore and engineered them out of the process.

Customers do not fall in love with automated systems.

6 Traps of Innovation

1. Tech First- the company knows the tech but does not understand who their customers are.
2. Team- the company knows the customer but does not have teams in place to deliver what is needed.
3. Rat Hole- the company knows the tech, customers and that they are supposed to be creating love, but they forget to start with clear goals.
4. Death by a Thousand Cuts-the company knows they need to make progress but are paralyzed by infighting, fear, or a lack of strategy.
5. The Pivot- the company cannot tell the difference between an idea that has no future and an idea that has not been executed properly. Failing fast can be habit forming.
6. Spin Doctoring- the company knows they want customer love but find it easier to focus on perception rather than delivering.

Lovability, a Solution.

Lovability is the capacity to earn genuine, heartfelt love and loyalty from customers.

Leads to consistent growth, profitability and sustainable happiness for all stakeholders.

Is about choosing value over valuation. Value is a measure of importance, usefulness, or worth of something.

Is about knowing customers like family.

Is something that is earned.

A lovable product solves a real need and exceeds customer expectations.

A lovable product does the right thing because it’s the right thing.

“There are no shortcuts to lovable growth. You do not get there by way of snazzy presentations, raising tens of millions of dollars, and press releases, but through humble, painstaking work of building relationships while putting people and values first”.

Building Blocks of Lovability

Source: Aha!

Utility

• Satisfaction- deliver a reality that makes the customer smile.
• Care- defy expectations of poor service and create customer delight.

Growth

• Confidence- the customer feels a sense of safety and security about the company itself.
• Trust- the customer believes in the hardware, software, people, values and mission. Solving problems builds trust.

Lovability line- customers start judging your companies less on rational criteria and more on emotional ones.

• Scale- your product is always ahead of customers’ needs and expectations.
• Sustainability- your culture, attention to detail, desire for excellence, commitment to people, and innovative spirit ensure continuity for customers.

Inspiration

• Motivation- customers feel the product helps them be better than they are without it.
• Fun- making customers smile on their journey to success.
• Halo- making the customer look really good.

How do companies become Lovable?

Redefine the product (what the customer thinks they are paying for) and focus on the Complete Product Experience (CPE).

CPE is the totality of what the customer really values and is expecting from a product over the long term. It requires personal contact, responsiveness and attention.

Begins with a tribe of people who are personally invested in delivering a lovable CPE and care about responding to inquiries, solving problems, getting to know customers, and growing relationships.

Why CPE?

• Technology is becoming commoditized, it is no longer features in a product that set a company apart, rather it is the CPE that will be a differentiator.

“We all know what it feels like to be understood. We all crave a partner who ‘gets us’ and understands what makes us unique. That is a very human need, and learning how to satisfy it should be a centerpiece of every engagement you have with your customers, whether you are just like them or not”.

• Data can tell what a customer is searching for and what thousands or even millions of others like them are looking for, but it will not tell why they are searching. That is why knowing customers like family is important.

7 Components of CPE

1. Marketing- how potential customers learn about a product.
2. Sales- how prospects educate themselves about the product to make a decision if the solution is right for them.
3. Technology- core set of features that a customer pays for; it should represent the beginning of a transparent, interactive relationship.
4. Supporting Systems- delivers the product; it is typically internal systems.
5. Third-Party Integrations- enable new products to fit into a customer’s existing ecosystem.
6. Support- all activity that helps the customer achieve something meaningful with a product.
7. Policies- rules companies set to govern how they do business.

How do you get the CPE right?

Gain a deep understanding of the customer > map the customer journey > recognize patterns.

Pattern recognition solves problems before the customer knows they have them leading to delight and love.

Understand that a brand is an outcome as a result of a company’s values and decisions playing out in the experiences of its customers. Customers determine the brand.

“The people who consume what you create decide if you are great”.

Understand that a product or service’s purpose is helping customers achieve something meaningful in a lasting way.

The Responsive Method (TRM), a method to create Lovability.

TRM gives employees a way to be themselves, work the way they want to, be appreciated, and achieve great things.

TRM gives leaders a framework for managing the messiness of building something and interacting with people. It reduces stress by eliminating the preoccupying backlog of unanswered communications and unmet needs. It gives back time by resolving issues and questions now instead of forcing them to play out over days.

TRM enforces the disciplined time management that all companies need.

Aspects of TRM

Philosophy- sustainable learning, lasting success and happiness originate in the respect and service of others.

“The best business is selfless business”.

Interaction Engine- people can contact a company with a question, a problem, or even something trivial and get a meaningful response with gratifying speed.

• Employees should have the right knowledge on hand to make the interaction meaningful.
• By helping and not selling, employees can be clear about beliefs and quickly learn if the other person shares those values.

Moral Framework- it is possible to be good, and still achieve great things, including strong profitability.

Pillars of TRM

Be goal first, vision defines your purpose. Goals are what you will accomplish and when.

Curiosity is essential, it can lead to positive surprises and reduce negative surprises.

“At its best, work is a quest for knowledge powered by insatiable curiosity”.

Re-frame interruption, listen to the distractions.

• Being interrupt driven means no longer cursing questions/problems as obstacles to work but seeing them as the work.
• It creates a virtuous cycle: give customers what they want, they give the team instant feedback, and the team improves the ability to give customers more of what they want.

No one likes to wait, so all inquiries receive immediate replies even if it is to let the person know their question has been received and that there will be a response later in greater detail.

• It gives the ability to structure the chaos of building something and dealing with people.
• By eliminating a communication backlog, the team can concentrate on the present.

Transparency matters, secrecy encourages customers to create their own explanations for decisions and policies which rarely gives the company the benefit of the doubt.

• Transparency leads to deeper, more productive conversations and greater levels of trust.

Interact with kindness, the cost of being a high achiever should not be losing one’s humanity. Caring evokes better performance than pressure and fear.

Signs of Lovability

Hugs- customers want to get closer to the product and the team because they felt connected to it.

• Customers prioritize their time to spend it with the company.
• Customers provide verbal expressions of admiration.
• Customers insist that a company “gets” them.
• Customers recommend the product.
• Customers apply for jobs at the company.

Love Notes- emails, posts, messages, referrals, survey responses with a heartfelt expression of love for the team and CPE.

• Can be used as an operating metric and is more reliable than customer growth as a metric.
• Growth and love are not always correlated (Eg. Large companies that regularly make it on the list of most hated companies)

Megaphones- customers are more likely to adopt or champion a solution even if they change companies.

Be Aware of…

The Venture Trap

• Founders caught in a cycle of spin and rumors of high valuations, place growth above all other goals.
• Exit fast thinking is anti-customer and encourages shortcuts.

“Money is both a tool and an outcome, not a product”.

The Cycle in Silicon Valley/Innovation Centers

Beautiful Distractions

• Raising lots of money.
• Building an MVP.

In a marketplace with few alternatives, the MVP philosophy fuels growth but today’s consumer has many products to choose from in virtually any category. MVP aims for good enough, not great. It breeds an employee culture of making the sale, not making the customer fall in love.

Aim for a Minimum Lovable Product- solve problems and delight customers right out of the box. It is the way our grandparents did business. It always worked but got lost in the glamour of big money, big egos, and confused teams.

• Hiring a sales team. Instead, aspire to create an experience so satisfying that people bought instead of being sold to.
• Renting an expensive office space.
• Eating steak and lobster. Extravagance pulls focus from the only thing that matters- creating extraordinary products and experiences that delight customers and win their loyalty. Reckless spending can become a habit.

Product Managers are an Important Part of Creating Lovability.

Why is the most important question any PM or founder can ask.

“if you are passionate about solving people’s problems and achieving meaningful things, why is the word that should open every conversation”.

Words of Advice

Technical debt accrues in unresponsive companies because they do not commit to fixing bugs.

Technical debt becomes a burden for customers and employees, because humans cannot keep track of everything that does not work. They learn to work around it — or worse, become blind to it.

“You are what you build”.

Metrics That Matter

• Monthly Unique Visitors
• Customer Acquisition Cost
• Organic Traffic vs. Paid Traffic
• Conversion Rate
• Number of Support Tickets Created
• First Support Response Time
• Time to Close Support Ticket
• Churn
• Active Users
• Monthly Reoccurring Revenue
• Total Annual Recurring Revenue
• Annual Contract Value
• Lifetime Value

Final Brilliant Words of Wisdom in Lovability

“You can scale and be human at the same time. Identify the moments when customers need to interact with a live person and then deliver interaction instantly and enthusiastically. The customer should not feel like an annoyance or an obstruction to your work. Customers are the sole reason you are at work.”

“Business has always been personal”.

“Work-life balance suggests that work is a fundamentally unhappy state that only the other parts of life — travel, family, fitness, time at the beach — can remedy”.

Want to read Lovability yourself? Buy it here.