A company could create a product with the same features as its competitor’s product, but customers are still not enthusiastic about it. There are several reasons for this, but one of the most common is that the product team focused too much on functionality while ignoring what the customers truly desired.
Customer satisfaction is not always tied to product functionality. As a result, product designers and developers must strike a balance between product functionality and customer fulfillment for companies to compete favorably in the global market.
Using Kano analysis helps companies achieve the harmony of product functionality with customer satisfaction. It’s a method for analyzing the non-linear relationship between product performance and customer satisfaction.
The primary goal of Kano analysis is to understand, categorize, and prioritize customer requirements or expectations for products.
The Kano analysis is a product development model designed to help organizations identify customer needs and product performance features. It is also known as the “Customer Delight vs. Implementation Investment” strategy.
The analysis helps organizations in prioritizing features on a product roadmap based on their likelihood of satisfying customers and the implementation investment.
The analysis states that there are five categories of a customer’s emotional responses to any product. These emotional responses include the following: must-be or must-have features, performance features, attractive features, indifferent features, and reverse features.
This analysis helps organizations in launching into the market by establishing what product features consumers consider essential. It also helps organizations stay competitive by showing them how to optimize product performance.
Finally, it helps organizations compete favorably by knowing what product features to avoid and what product features excite consumers.
Professor Noriaki Kano developed the Kano analysis model for product development in the 1980s. Noriaki Kano was a quality management professor at the Tokyo University of Science.
Before 1984, when he published the Kano model analysis, organizations relied solely on complaint processing and the enhancement of popular features to ensure customer retention and loyalty. Product quality was measured based on operational parameters only.
This meant that all efforts were concentrated on developing products that were free of flaws. The product with the fewest flaws was deemed to be of the highest quality.
However, with modernization and increased competition, producing non-defective products is no longer enough; the new challenge is to outperform the competition.
This prompted Professor Noriaki to investigate what customers desired. He was looking for proactive measures that brands could rely on to maintain and improve customer loyalty levels.
He enrolled 900 participants for his study to demonstrate how customers’ emotional responses to products work. He concluded that quality should be a two-dimensional relationship.
The dimensions are customer needs fulfillment (i.e., product functionality or performance) and customer satisfaction.
Professor Kano developed a functionality scale that ranges from best to good to basic to some to none. This scale investigates how customers decide whether a product is valuable enough for them to buy it.
He also developed a satisfaction scale that ranges from delighted to satisfied, neutral, dissatisfied, and frustrated. This scale assesses customers’ actual emotional responses to products.
According to the theory, a product must provide emotional satisfaction to customers in addition to functionality. This means that a product may have the features customer needs and they’ll still be unimpressed by it.
For example, people buy cars for transportation but then upgrade to newer models because they are dissatisfied with their current model and want the new model’s features.
Applying Kano analysis helps organizations’ product teams understand basic customer needs and additional features that will impress and retain customers.
The end goal of any Kano analysis method is to measure customer satisfaction. So, frame your questions in a questionnaire or survey to elicit the range of feature categories in the Kano analysis.
The best two questions for determining the product attributes are:
The range of responses provided by customers will now tell you how customers feel about each attribute of the product. For example:
Those responses that fall under necessary and neutral are usually what the consumers consider as necessities that the product must provide- the “Must-be.”
Customers’ responses that hint at appealing attributes may be used as a cost-cutting factor. You can ask customers if they are willing to pay more for the continued enjoyment of the product’s exciting features.
The potential emotional reactions of customers to product features classify those features into five categories-
These are the main qualities that the product must have. Their presence does not improve the product, but their absence causes significant dissatisfaction. They are also known as threshold features.
A customer renting an Airbnb, for example, expects it to be clean and have a bed. It is the bare minimum. Customers expect these features to always be present, so they don’t even bother to mention them.
An increase in these features will lead to higher customer satisfaction. They are also known as one-directional attributes.
For example, a car with a standard storage tank is okay and falls under the “must-have” category, but an increased storage tank for the same car becomes a performance attribute that increases customer satisfaction.
Customers are pleasantly surprised when a product has these features. They would not have noticed if these features are absent nor would they be dissatisfied.
However, the presence of attractive features over time raises them to the status of “must have” features. Customers may begin to expect them to be the bare minimum if competitors copy them, and they will lose the initial excitement they provided.
These features have no impact on customer satisfaction. They should be removed if they are not needed for the product’s functionality and are simply consuming resources.
These are not even present on the Kano graph. So you’d know that they bring dissatisfaction to the customers.
Customers tend to experience feature fatigue if a product is overloaded with features, so it’s best to get rid of them.
Net Promoter Score (NPS) is a single-question survey used to assess a company’s customer loyalty.
Would you recommend [Organization X/Product X] to a friend or colleague? Their answers should range from 0 (not at all) to 10 (very likely).
Loyal customers usually give a score of 9 to 10, while satisfied but unimpressed customers give a score of 7 or 8. Those who tick 0-6 are extremely dissatisfied and may even discourage others from using the product.
Analyzing customer feedback with the Kano analysis graph enables your product team in developing positive features and increasing customer satisfaction. As a result, your NPS will rise.
Once you’ve identified your customers’ top priorities, you can tailor your product’s features to meet them. Examine each feature’s cost and benefit model to see if it provides an acceptable return on investment.
Then you can easily eliminate features that cost you money but provide no benefit to customers. This will save you time and money during your product development cycles.
The answers from the Kano analysis make it easier to divide your audience into segments. Likes and dislikes shared by certain demographics are easily visible.
This helps you identify what each segment wants and improves your sales and marketing efforts. It helps you draft and direct future marketing efforts to each of your marketing personas.
Kano analysis helps you generate ideas for future products. Once the analysis provides insights into what customers find essential and attractive, you can use those ideas to develop similar or improved products in the future.
After applying the Kano analysis categories to all of your product’s features, you can even draw the Kano analysis graph to show where each product feature fits.
It also helps you improve the positive features, such as performance and attractiveness, and eliminate customer pain points.
Avoid asking questions that your customers could easily misinterpret. Check to see if the questions you’re using can elicit unambiguous responses.
It will explain the “why” behind the many options available to customers for each product feature.
The Kano analysis is the best place to start if your product team is looking for customer-driven inspiration to create a new product or modify features of an existing product.
It will save money and time because it provides a clear window into how customers rank each product feature.
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