Very interesting! Can’t imagine how sales breakthroughs could possibly come from such little tweaking of your product or service. I like personally the example of putting shopping carts in the middle of shopping center since I so often avoid going back to the front to get one! The Three-Minute-Rule is insightful!

At our venture capital firm, Cue Ball, we are pretty maniacal about understanding customers. We encourage our portfolio company CEOs to dive deep — very deep — and learn about their customers along every possible dimension. My Partner, Dick Harrington, and developed a customer-driven approach and capability set that we put in place at Thomson which ultimately was a key driver of the company’s transformation into a global media and information powerhouse. We wrote about this in a 2008 HBR article, Transforming Strategy One Customer at a Time.

While there are obvious ways to gain significant customer understanding, such as surveys and focus groups, some of the most interesting insights come from less direct analyses. Take our three-minute rule as an example. You can learn a great deal about customers by studying the broader context in which they use your product or service. To do this, ask what your customer is doing three minutes immediately before and three minutes after he uses your product or service. At Thomson, one of our products provided investment analysts with financial earnings data. What we hadn’t fully appreciated — until we applied the three-minute rule — was that immediately after getting our data, a large number of analysts were painstakingly importing it into Excel and reformatting it. This observation led us to prioritize developing a more seamless Excel plug-in feature with enhanced formatting capability over other product development initiatives. The result was an almost immediate and very significant uplift in sales.

The three-minute rule also helps highlight unique cross-selling opportunities. Many years ago, I remember doing some ethnographic research on female drug-store shoppers. One fascinating pattern we saw was that a significant number of women picked up a disposable camera after putting newborn diapers into their shopping carts. Follow-up interviews confirmed that snap-happy moms were often new moms. Placing disposable diapers close to inexpensive disposable cameras furthered this purchase pattern and would not have otherwise been an intuitive merchandising or cross-selling strategy. ”

… The full article can be found at or click here:

The Three-Minute Rule
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