AugustÃn, the president of the retailer Emilia, was very set out on changing Emilia’s strategy. Emilia was a clothing company that had a customer base mainly made up of middle and older age women. The problem was that these middle/older age women would only by clothes at Emilia if they thought they were getting a deal: a super sale or discounted prices. Augustin didn’t like this. He didn’t like constantly pushing sales campaign after sales campaign. Augustin’s new idea was to pivot the company towards younger customers that would be more willing to pay original price and be less stingy with money.
Augustin mistake however was not taking the time to validate his hypothesis through need finding. He instead insisted that he was right and that the change made perfect sense in his head. This “nothing can go wrong” mindset was his downfall. Augustin’s hypothesis could’ve been “younger customers are more willing to pay full price” or “after pivoting, we will attract new younger customers”. Augustin also should have thought about how this would affect his current customer base: “in the wost case scenario, if all our current customers leave, how will we attract new younger customers?”
If I were advising Emilia, I would first make talk Augustin into making this transition take more time. We would need to validate all aspects of shifting the entire company’s focus to younger customers. We could also consider other options: not pursing this change or modifying the current strategy but keeping the same customer base. The first step of needfinding is to survey our current customers and validate the assumptions Augustin made such as “do our current customers only buy our clothes at discounted prices?” and “are younger customers more likely to pay full price for our clothes?” After validating these, we can decide on whether or not we want to pursue this change.
