We often talk (and write) about ease-of-use and creating products that delight users, but its rare to see an actual example, from a company founder, describing how those things made a concrete and VERY significant difference in the success (and failure) of competing companies.
There’s a great post by Marc Hedlund — founder of now defunct personal finance site Wesabe.com — about why he lost the battle to Mint.com. Mint – a similar personal financial site – was bought by Intuit for $170,000,000 after about 2 years of operation.
Marc goes through a very honest and detailed explanation of reasons why Mint succeeded (and Wesabe did not), even though Wesabe started about 10 months before Mint. Marc makes it very clear that Mint’s approach to usability and ease of use were the primary factor in their success.
Value to the customer must be a factor in your business decisions
The first difference Marc describes is data collection. An automated way for users to collect and enter their’ financial data into Wesabe or Mint was needed. Given the multitude of banks and other sources of data, this posed a problem for the sites.
…we [Wesabe] chose not to work with Yodlee, but failed to find or make a replacement for them (until too late). Yodlee is a company that provides automatic financial data aggregation as a web service. They screen-scrape bank web sites (that is, read the payee and amount and date by parsing them out of the bank’s web site, writing a custom parser for each bank they support)…Mint used Yodlee…to automatically get user’s data from bank sites and import them into Mint, and as a result had a much easier user experience getting bank data imported.
Wesabe had reasons for NOT working with Yodlee — primarily Yodlee’s shaky financial status at the time — but that was not something that directly impacted users. What impacted them was the extra work they had to do to get their data into Wesabe as compared to Mint.
The little things count, and will be valued by users
Once the data was collected, there is still the process of sorting through it so it can be analyzed and managed.
Mint focused on making the user do almost no work at all, by automatically editing and categorizing their data, reducing the number of fields in their signup form, and giving them immediate gratification as soon as they possibly could; we completely sucked at all of that.
None these items — auto-categorization of data, minimizing fields in the sign up form or giving “immediate gratification” are technologically challenging things to do. Nor do they require huge engineering investments in architecture or infrastructure. But from a user perspective, they all add up as part of what was likely a pleasing experience overall. It’s really more of a philosophy of how you want to deliver value to your users and one that many companies forget as they focus on “business value” and “risk mitigation”.
Marc later states very bluntly:
…I was focused on trying to make the usability of editing data as easy and functional as it could be; Mint was focused on making it so you never had to do that at all.
Trade off those things that customers don’t value
This may sound like a truism and not worth mentioning, but it’s amazing how many companies focus inwardly when they make these tradeoffs and don’t look at what their users actually care about.
Marc adds the following comment in defense of what Wesabe’s approach to managing data:
To be defensive for just a moment, their data accuracy — how well they automatically edited — was really low, and anyone who looked deeply into their data at Mint, especially in the beginning, was shocked at how inaccurate it was. The point, though, is hardly anyone seems to have looked.
Mint did have problems as Marc points out, but in the end, those problems weren’t all that critical to users. A little lesson to keep in mind the next time you need to make tradeoffs in your product. It would seem “obvious” that accuracy would be important in a financial application, but Mint’s users didn’t care for accuracy as much as they liked the automation.
Don’t base your success on changing people’s behaviour
And continuing with the philosophy of value, contrast Mint’s approach with that of Wesabe. The following passage describes how Marc saw the value he wanted to deliver.
I prioritized trying to build tools that would eventually help people change their financial behavior for the better, which I believed required people to more closely work with and understand their data. My goals may have been (okay, were) noble, but in the end we didn’t help the people I wanted to since the product failed.
This is likely Wesabe’s biggest flaw. Changing people’s behaviour is incredibly difficult, and if the success of your product depends on that, you will likely fail.
As an example, look at all that exercise equipment and videos that get sold every year. People buy them, but do they actually use them? For the suppliers of those products, their success depends only on selling their products (i.e. the transaction), not on changing anyone’s behaviour. In fact, the existence of a thriving and long lasting home fitness industry is proof that people’s behaviour doesn’t change very easily! If it did, the industry would soon become unnecessary.
Focus on the needs of the user, even at some risk to you
Towards the end of the post, Marc gives an overview of what happened to Wesabe.
Between the worse data aggregation method and the much higher amount of work Wesabe made you do, it was far easier to have a good experience on Mint, and that good experience came far more quickly. Everything I’ve mentioned — not being dependent on a single source provider, preserving users’ privacy, helping users actually make positive change in their financial lives — all of those things are great, rational reasons to pursue what we pursued. But none of them matter if the product is harder to use, since most people simply won’t care enough or get enough benefit from long-term features if a shorter-term alternative is available.
In isolation, all those business decisions by Wesabe look sound, but they were for Wesabe’s internal benefit, and didn’t have clear value from the user perspective. This is a tough one because what is clear in hindsight is not always clear in the fog of battle. Keeping the user’s needs front and center takes discipline and must be part of the culture of a company.
And in summary…
Marc makes a very clear statement that should be ingrained in every person working in virtually any company.
Focus on what really matters: making users happy with your product as quickly as you can, and helping them as much as you can after that. If you do those better than anyone else out there you’ll win.
I don’t think I could say it any better than that so I’ll stop here. 🙂
Saeed
NOTE: Shortlink to this post – http://wp.me/pXBON-1M1