“Get out of the Building” – Steve Blank
Most of the times Ideas fail because the founders think it’s a problem that needs to be solved but it’s not really a problem at all. Most of the time founders sit behind their screens and start developing the product. But founders need to get out of the building and keep all the efforts to understand and understand their customers first.
When you Identify a problem to work on, you will tend to obsess over the Idea and think its the worlds first and best idea of such kind and the possibility you got it wrong it almost 99% if you haven’t spoke to your customers yet.
You can have multiple solutions to the same problem and your job is to find the best solution that a mass of people would pay for. Customer Development is an art and science that will help you save your money, time and heartbreak while craft your idea and help you find if it’s the right Idea you need to be working on. It’s about understanding your customers truly and build something for them.
The steps written here will help you do the customer development right and helps you avoid world’s obvious mistakes everyone does while doing so.
What’s the key goal
The key goal is to understand your customer’s problems and understand their pain points and to find a Product Market Fit. To understand what they want we need to ask questions that are unbiased and not actually sell your solution without knowing their pain points first.
You can rinse & repeat until you know you have the best solution that fits their problem(technically we can call it as finding Product/Market fit).
How to prepare to ask, Moms test
I often see founders doing it all wrong. They go something like this.
“Hey, I have Solution X for your problem Y. It has Benefit 1, Benefit 2, etc, For the same/less cost. Would you buy it?”
If you are starting off with this, you know you are in trouble, no matter what you are selling it’s quite dumb to ask. If you are giving those benefits and you say it’s better than something else anyone in the world would buy it right? So what’s wrong here?
People try to be nice. Therefore they lie to you on your face without realizing it. And your mom would become the best liar in the lot as for your Mom whatever you do will be the best and it shouldn’t surprise if she says everyone would want your solution.
We call this false positive and these data points are worthless. The idea here is to get genuine data points so you can have a better perspective of deriving a solution for them and not actually sell them at first place.
Here is an example to see what is a general conversation when you want to tell about your Idea and validate and actually ask the right questions so even your mom would give the right answers(Hint: Ask open-ended questions)
You: Mom, I have a business idea. Do you have 5 minutes?
Mom: Of course, dear …
You: You like your iPad and use it a lot?
Mom: Sure, it‘s great. …
You: Would you buy a cookbook app?
Mom: I love cookbooks, sounds nice. Does it come with vegan recipes? Or something special for Xmas?
So you obviously see something wrong here. You prematurely entered into a selling mode and your Mom don’t want to hurt you obviously. Here is a probably right way of asking it.
Mom, when have you last time used the iPad?
Have you ever used it in the kitchen?
Have you ever bought an app?
For how much? Do you use your cookbooks?
Is there anything you dislike about them?
What was the last cookbook you bought?
These are quite open-ended questions and these gets you honest answers. Maybe you will get an answer like. “Yea, I used it in the morning for checking emails. Nope, I don’t take my iPad to the kitchen as I think I will spoil oil or water on it. I have hundreds of cookbooks and I liked a couple of them. Yea, you know what? Guess I would have liked the videos with running comments below so I don’t miss any ingredients that I missed following
Do you get the point ?
Preparing the questions to ask
- Write down the customer segments you want to target. Understand that there will be different customer segments for your product. Tailor few questions that can vary your customer segment. For Example, if you are developing an app like Uber(Hypothetically) everyone who needs a car on demand can your customers. You can break it down to more customer segments as – Students, working professionals, people who attend events frequently etc,
- Prepare at least 10-15 questions that are open-ended and those ones that will help you understand and have a better perspective on understanding your customer and customer’s problem.Choose which segment you are doing to start with.
- Meet 5 people in person in your selected customer segment. Many first time founders think it’s hard to get time from someone. No matter who , if you give the right context and you tell them you need their time so it will help you build a better solution. You will be surprised to see how many people will be willing to give you time on this. So go ahead and ask. It should typically take 40 minutes on average with each person. (Tip: Once you complete the interview ask for references you can go and talk further to. These will help you create the initial funnel to reach when you have your MVP)
- Make notes and learn. While you talk to these people, make notes and points on what you are hearing and learning. You will find there will be few open-ended questions that are more important and few not important at all. Talking to 5 members is good enough to get the initial set of valuable questions. Now you need to get set with a bigger set of audience.
Survey 100(at least)
Take the questions you have and make an online form with these questions. Since you know you have good questions to ask and know the clear intent, you are good to go and ask more people online.
Send it form to everyone in your network, ask them if it’s relevant for them, else ask them to refer. In the era of social media, finding 100 relevant form should be very easy if it’s a B2C product. If you are building a B2B product. Get it done by at least 10-15 people who are relevant to your product.
This exercise will help you validate if it’s the same problem more people have and it will help you get your early adopters too.
Fake it, ask for money
Asking money is the best thing to do to validate something even before you build(and it’s the hardest thing if you can let someone give their hard earned money to you) .
Find out the competitors about the pricing, hypothetically find a price point that you think will be feasible for you to be profitable. Don’t try to go into pricing wars from the start. You could probably give the actual price on your website(landing page is enough at this stage) and tell them for early adopters say it’s 30% off(Well not exactly that % but you get me point right?).
Tell them your product is being build and give a probable date of launch and see how many people will actually want to pay(Bummer: I am saying you need to ask for money not ask like ‘would you pay for it’). If they say yes and will pay to try it, don’t take the money, tell them you will get back soon. Build your MVP in this time.
Build MVP and have early adopters
If done right you have spent good enough time sharpening the Axe and it’s time to get to real work. Build the MVP (Minimum Viable Product) meaning build just those one or two features that people can try and check(and pay you). Take quick feedback every time someone uses your product. Take feedback and improve on it.
You already have reached more than a 100 people from your surveys and customer interviews, reach out to them and get early adopters. Find customer groups online, offline, from your network, events or even to the marriage event you are attending. The Only thing that matters is to get more people to use it, learn on it and improve the product from taking feedback from early adopters.
Tools you could use
- MS Word , Notebook/pen for writing your customer questions
- Sticky notes pens/sketches to make customer segments
- Google Forms, Type forms for taking surveys
- Coffee (offer this and it works well to get someone’s time for interview :D )
- Launchrock (Landing page)
- Javelin board/Validation board (for validating hypothesis for different customer segments.