I’ve now got 500 (probably 800) channels and there’s nothing on. Well, I’ve overstated the fact. I have about 30 movie channels, at least 7 channels dedicated to major sports leagues, and innumerable shopping, food, and car chase channels. I recently re-entered the world of Comcast HD for the purpose of getting better internet access, seeing a few more sports events in HD, and for the On-Demand video service. Yet a funny thing happened. In the midst of the content overload, I realized that having more bandwidth is … fabulously good.
Before I had DSL and had modest speeds (3mb/s down, 768k/s up). This was fine for most internet surfing, though working at home and uploading large files sometimes seemed a bit pokey, especially when using a VPN. Yet now I have 10 times the speed. Ten times the speed. I now understand the benefit of improving a product or service by 10x. It shakes you out of your current behavior and provides an opportunity to try new things and get new benefits.
In the classic HBS Article Eager Sellers, Stony Buyers: Understanding the Psychology of New Product Adoption, John Gourville posits (and proves) that sellers overvalue the benefit of the product they are selling by 3x. He also finds that prospective buyers overvalue the benefits of the product they have by 3x. To overcome this stasis, entrepreneurs need to provide a 10x improvement to break through the behavioral trigger that stops buyers from buying when they ought to find benefit.
I didn’t realize that I was getting a 10x benefit in network speed by changing my subscription. In fact, it took a lot of pain (loss of channels, high customer acquisition cost through subsidy by Comcast, and a visit by a technician causing me to wait almost a week for new service). Yet now all I can think about is what I want to do with an extra 9x of bandwidth. I can now stream music, watch an movie in high definition as soon as I want it, and download and upload files with ease. I wonder what the next big idea will be now that I am no longer stuck in the same old rut.
Moving to a startup has provided a similar eye-opener at work. And it provides another eye-opener: our current and prospective customers need the same 10x improvement to believe in our work, to trust us with their time and effort, and to be truly wowed by the improvements we build. This is why improving things by 10x matters, and why it should be the goal of any entrpreneur or person.
Information Maven 