Why Milkshake?
A brief summary of how we got our name, the meaning behind it and the case for contextual based segmentation and purpose branding.
Milkshake is more than a (really) fun agency name. It’s a little nod to Harvard Business School Professor, Clay Christensen’s Milkshake Marketing Theory. Told you we wear some pretty nerdy glasses!
The theory was born out of a study on McDonald's milkshake sales. McDonald's wanted to boost their milkshake sales and crafted strategies based on customer profiles and preferences. They gathered extensive data on their core target audience and invited people who fit these profiles to provide guidance on improving their milkshakes. However, despite implementing customer suggestions regarding flavours, colours, and viscosity, there was no significant improvement in sales or profit.
This is where the Milkshake Marketing theory comes into play (science to the rescue!). A research team observed the buying behaviour of McDonald's customers. Instead of focusing on the customers' demographics, they investigated the 'job' the customers 'hired' the milkshake to do.
They discovered that many customers bought milkshakes as a convenient, mess-free breakfast for their morning commute. The research revealed that half of all milkshakes were sold before 8:30 am, typically to lone commuters who took the milkshake to go. They needed something that could be consumed easily during their boring morning commutes, and milkshakes were perfect because they lasted longer and didn't create a mess.
Likewise, the research found that parents often bought milkshakes as a special after school treat for their kids—a treat that wouldn't result in a long wait as the children tried to finish it.
Understanding these insights, McDonald's tailored their milkshakes to fit these 'jobs.' They made morning milkshakes even thicker and more interesting by adding chunks of fruit, making them last through long commutes. For children, they created a different, thinner milkshake that could be consumed faster. This approach led to a significant increase in sales.
This lesson? Context matters.
Understanding the 'job' your product is hired to do and constructing compelling narratives that underscore this role is key. This became the cornerstone of our work at Milkshake.
To me, the Milkshake Marketing Theory is about using contextual-oriented segmentation rather than attributes-oriented segmentation. It means looking at the product, place, price, and promotion holistically. In context.
Many new products fail because their creators use an ineffective market segmentation mechanism, according to the OG Milkshake Marketer, Clay Christensen. The reason this approach performs poorly is that consumers usually don't go about their shopping by conforming to particular segments. Rather, when faced with a job that needs doing, they "hire" a product to do that job. To that end, Christensen suggests that companies start segmenting their markets according to "jobs-to-be-done."
Christensen elaborates, "The fact that you're 18 to 35 years old with a college degree does not cause you to buy a product. It may be correlated with the decision, but it doesn't cause it. We developed this idea because we wanted to understand what causes us to buy a product, not what's correlated with it. We realised that the causal mechanism behind a purchase is, 'Oh, I've got a job to be done.' And it turns out that it's really effective in allowing a company to build products that people want to buy."
Several major companies have succeeded with a jobs-to-be-done mechanism: Apple, for example, fulfills the job of providing innovative technology solutions that enhance everyday life. Netflix does the job of delivering convenient, on-demand entertainment. Tesla provides sustainable and high-performance electric vehicles. Amazon's success skyrocketed when the company focused on the job of delivering a vast range of products quickly and conveniently to consumers' doorsteps.
The jobs-to-be-done framework can seem a little bit reductive on the surface. “What about brand”, I hear you cry? Our boy Christensen doesn’t miss. He encourages "purpose branding"—building an entire brand around a particular job-to-be-done. At its most simple version, purpose branding involves naming the product after the purpose it serves. At its most complex, purpose branding is about creating an entire ecosystem around a product that embodies its core mission, integrating brand values, customer experiences, and emotional connections to create deep, long-term loyalty. GoPro signifies the purpose of capturing professional-grade action footage easily, while Swiffer reflects the swift cleaning action of its products, and Fitbit embodies its core purpose of helping users stay fit by tracking their physical activities.
When I first read Christensen’s work at uni I had a lightbulb moment. The idea stuck and saw me create Milkshake, an agency that applies contextually oriented segmentation and intentional, purpose branding to build brands that truly resonate with their audience. We work to understand the 'job' that brands are hired to do in their customers' lives and create compelling narratives that underscore this role.
So, what can small businesses take away from the Milkshake Marketing Theory?
Understand the Job to Be Done: Instead of focusing solely on customer demographics and preferences, small businesses should identify the specific "job" their product or service is hired to do. By understanding why customers use their products, businesses can tailor offerings to better meet those needs, leading to increased satisfaction and sales.
Context Matters: Contextual-oriented segmentation can be more effective than traditional demographic-based segmentation. By considering the broader context in which their products are used, small businesses can create more relevant marketing strategies that resonate with their customers' real-life situations.
Embrace Purpose Branding: Your brand is the most valuable asset you own. Invest in it and work to build a brand around a specific job-to-be-done to create stronger connections with customers. Small businesses should focus on the core mission of their products and integrate this purpose into their branding, customer experiences, and marketing efforts to create authentic, long term connections.
