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What the customer wants?

Posted by Colin Kingsbury

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Aug 4, 2006 4:09:00 PM

Why did GM continue to crank out gas-guzzling SUVs throughout 2004 and 2005? Because customers kept on buying them. As I wrote in When Bad Features Feel Good, customers often say they want a bigger salad bar but order the spaghetti carbonara

Yankee Group analyst Jason Corsello writes about a conversation with a CEO who said, "you aren't a SaaS vendor unless you require zero training." Jason commented that "at least in today's enterprise environment, his statement is more utopia than reality" and went on to say that,
Recruitment-centric (otherwise known as ATS) vendors, in particular, have struggled with this concept in that most of e-recruitment/ATS products today have been over-engineered and continue to struggle with enterprise use and adoption.
This statement is factually correct as far as it goes but it leaves out the primary cause of the problem: customers keep on asking vendors to build SUV-style applications.

When we launched our applicant tracking system in early 2005, it was a model of economy and simplicity. Every feature was right where you'd expect it and training sessions or demos took perhaps 30 minutes if you went into detail. Every screen was bright and beautiful. Everyone commented on how easy the system was to use and how they couldn't imagine needing any sort of training.

But there was trouble in paradise. More often than not, the demo and pitch would go over perfectly, but the prospect would give us the kiss of death in the followup call, saying something like, "You guys have built a really excellent, simplistic system." No one ever argued when we said that we had 80% of what you needed and we did that 80% better and easier than anyone else. They all just said that they absolutely needed some particular feature in that remaining 20% and bought a kitchen sink system from one of the competitors and told us to check back in a year or two. So we learned our lesson.

Over the next year, our feature count roughly tripled. From a sales perspective this has been an overwhelming success, as our customer base grew over 100% between March and May of this year, and will likely double again by sometime next month. But it does come at a price: even a 90-minute demo is going to leave out one or more major areas. In terms of training, we are about 1/4 of the way through producing four hours worth of Flash videos in order to reduce the need for in-person training, which is as inconvenient for customers as it is expensive for us.

Customers still compliment the beauty and well-thought-out design of our system. They still say we're the easiest to use system they've looked at. The added complexity is all calculated: simple things are still relatively simple to do, and the system now handles complex tasks it previously did not touch. But simple tasks are generally speaking more difficult than they used to be, because each advanced feature adds a little overhead to other processes. And in the end, 90% of what customers use day-in, day-out is what we launched with a year ago.

In the end, buying an ATS is not unlike buying a car. Sure, you will need to transport six adults and all their skiing gear once or twice a year, but the rest of the time it is going to be you and the groceries. After a year of $3 gas, people are starting to realize it makes more sense to buy a compact car and go to Hertz for those other occasions. Similarly, one of the patterns we've seen is that we do great whenever we talk to a director of recruiting or VP of HR who implemented one of our competitors at a previous employer. They know all the costs that come with the bigger systems and realize that we're still simpler and simpler is definitely better.