Most of you have heard my rants about the need to do customer development in tandem with product development and are probably already rolling your eyes knowing that you’re about to hear “nail it before you scale it” again.
So I get it, you’ve all bought in to lean startup, market validation/customer development. But now what…. once you actually “get outside the building” to talk to customers on the quest for product market fit, what do you do? How do you test all these great hypothesis you’ve put forward in your business model?
It starts with talking to customers, aka, conducting customer development interviews. You need to arrange meetings with people in your target customer segments (you should have a list of “friendly’s” that you can start with but watch for a follow up post on how to get these meetings). For now let’s talk about how to structure these customer development meetings to maximize the learnings and avoid having happy ears.
Customer development meetings
I like to structure customer development sessions around three broad topics – the person/role, the problems and solution. While I ask for 20-30 minutes of someone’s time I find they typically run 30-45 minutes if the person is engaged.
1. The Person/Role
First you need to learn as much as you can about the person you are actually talking to before you get into anything about their problems or your solution. You want the flow to be interactive and non-salesy so it’s as much about building rapport initially.
Questions to ask include:
- What is your role at your company?
- How do you fit into your company's department structure? Overall in the company?
- What is your budget like? Who has to approve your purchases? (for example, you want to know do they use their credit card for a purchase similar to what you’ll offer or do they have to get someone elses)
- How do you discover new products to help you in your role? (web searching, go to websites, trusted advisors?)
- Do you need any approval to try stuff out?
- Have you tried anything new recently?
- What is a typical day like on your job?
- How much time do you spend doing <insert anything from their typical day that jumped out at you>?
Don’t take shortcuts here… the more you know about their daily life the better. It will give you insights on how and when to market to them, what motivates them, etc., etc. All of this will help you later pattern match who the user type that is most receptive to the problem you're solving and the solution you offer.
Next you want to find out what challenges they really have in their job and figure out whether the person has the problem you think you're solving. It’s important to again not sell or lead here – you don’t want to guide them to your problem. The less you lead them while still hearing your problem being mentioned the more validation you have.
Questions to ask include:
- What are your top 3 challenges you face in your job? Or, maybe digging deeper, what are your top 3 challenges you face in your job related to <insert your industry/market>
- If you could wave a magic wand and instantly have a solution to any of those problems...what would they be?
- Dig deeper into their typical day on anything that sounds painful or expensive.
- How have you tired to deal with or solved <problems they’ve outlined>? Basically your trying to find out if they have any problems big enough that they’ve tried to coble something together themselves – if they have, ask to see it…
I’ve found that it’s not usually difficult to get people to talk about their issues so let them rant, in fact encourage teh rant… the deeper they go the better. You also want to get them to share what they envision as solutions.
Again, try to avoid mentioning your solution or problem yet – hopefully they call it out themselves. If they don't, then as you’ll you need to broach it so ask them if what you think is a problem is a problem for them. Whether they agree it's a problem or not, you want to then probe why it wasn't one of their top problems.
Hopefully the problems you think you are going to solve come up organincally so you know you’re on the right track. Even better, if when they wave the magic wand, they describe something along the lines of what you plan to do…
However, whether they call it out or not, you need to get into a discussion about what you thought the problem was and how you solve. Remember getting a quick “no, wouldn’t be interested” here is just as good as getting a “Love it”.
Questions to include:
- Walk them through the problems you believe your solution solves. Take them through how you solve.... Do they agree?
- Do you solve any of the other problems they might have called out?
- Would you be willing to pay for our solution? How much?
- How would they typically acquire your type of solution – try to understand what your sales cycle might look like, who might be involved in this kind of solution, how do they budget for this type of thing, etc…
- What model would you like it delivered in – do you have a great supplier that you could model after?
- If they like it, how would their org purchase something like this solution?
- How would we need to market effectively to people like you?
If all goes well and you really are solving a pain then you probably have someone that wants to be a beta customer or case study customer at a minimum. Remember that most product plans don’t survive the first customer interaction so the more likely outcome though is that your going to learn a ton about your ideal customer, what they do, how they work, etc. and you can start to iterate (and plug this insight into your product development plan).
You need to do a number of these customer development meetings – I like to do at least 10 so you have enough data points to get a sense of trends...
Fight the natural entrepenuer urge to skip this step because you already know what the market wants…
To build a business that can really scale (yes I’m biting my tongue and fighting the urge to type “nail it before you scale it”) what you need to find and solve is the “big pain in the ass, saves me a ton of money by solving” problem not the “nice to have problem” and this structure can get you along way down that path.
I'd love to hear your thoughts about market validation... got any tips that work for you when talking to customers or other tactics for testing product market fit? Throw them in the comments below....