Customer development — both interviewing and then figuring out how to decipher the responses you get — is an art, not a science.
A validated hypothesis has the following components:
- Customer confirms that there is a problem.
- Customer doesn’t accept it the problem as “that’s life” or “it’s beyond my control.”
- Customer is already investing resources (time, money, learning curve) into trying to solve this problem.
- Customer is already investing behavioral change into trying to solve this problem.
- Customer does not have any constraints that prevent them from trying this solution.
(Yes, you can launch a product without having all of these validations in place, and it might still be a success. And distribution and pricing may still kill you. But this is a really strong start.)
But what does that actually look like? (And what does not validated look like?)
I’ll list out some examples of “maybe” vs. a “yes!” responses. Let’s use Freda and Jasper, both of whom have already told us that they need to lose weight.
Customer confirms that there is a problem
Freda: “I’ve gained 20 pounds over the last few years, and I feel awful. I have to lie down to zip up my jeans!”
Jasper: “I’ve gained 20 pounds over the last few years, and I feel awful. I had to move my belt out another notch this morning!”
Yep, both of them have a problem.
Customer doesn’t accept it the problem as “that’s life” or “it’s beyond my control.”
Freda: “It’s so hard; I’m so busy with work and kids and volunteering. But I know it’s possible to lose weight, and I just have to make the effort.”
Jasper: “It’s so hard; I’m so busy with work and kids and volunteering. I guess that’s why everyone I know gets heavier after age 35…”
…but Jasper sees this situation as normal. If he doesn’t lose weight, he’ll still be the same as his peer group.
Customer is already investing resources (time, money, learning curve) into trying to solve this problem.
Freda: “I joined my neighborhood gym and signed up for a trainer. It’s expensive, but if I know what I should be doing, I’ll be more likely to keep it up, unlike last time.”
Jasper: “Yeah, I really should lose some weight – that’s why I’m really interested to see what your product is, maybe it can help me!”
Don’t confuse aspirational thinking (“I wish I was the type of person who did X”) with customers ready to take action (“I wish I had tools to help me do X better/faster/more effectively”).
Customer is already investing behavioral change into trying to solve this problem.
Freda: “I started taking the stairs instead of the elevator. I used to drink 3 or 4 sodas a day, now I’m down to 1 and water or tea the rest of the time. I feel like that’s not enough, though.”
Jasper: “When did you say your product will be ready? I can’t wait – I just need something to kickstart me into action and then boom, I’ll really get serious about this.”
Jasper will never be serious about this. Jasper is still riding the elevator one floor up to the vending machines. Jasper will never pay you anything.
Customer does not have any constraints that prevent them from trying this solution.
Freda: “I’m lucky my family is supportive of my goals and, even if they don’t like it much, they won’t revolt at me spending more time exercising and keeping less junk food in the house.”
Jasper: “Well, it’ll depend. My kids are such picky eaters, I don’t think I can convince them to try kale or couscous. And, of course, my wife has us on a pretty tight budget with the current economy…”
Jasper has external stakeholders who will sabotage this sale.
The thing is, both of these people can sound genuinely concerned and eager and enthusiastic. Tone alone could entirely fool you. Emotion is important — certainly, with lack of emotion you’ll have a hard time selling — but behavioral indicators are much stronger.
Popularity: 14% [?]
September 30th, 2011
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- “Isn’t customer development just product management?”
- “You don’t really need product management if you do customer development right.”
- “Customer development is fine for startups with no process, but it doesn’t fit into a mature product management organization.”
I’ve heard all 3 of these, and I think they’re all completely wrong.
Customer development and product management are two complementary tools. Used together, they provide a competitive advantage to any products company.
Customer development is not the secret to creating a great product. Let me repeat that, because I’ve heard many people claim this: Customer development does not create great products.
Customer development is primarily a risk mitigation tool.
It replaces that uneasy guesswork of assuming there is a market for your idea based on:
- analyst reports
- what your competitor is doing
- the opinions of the highest-paid executive in the room
You start customer development with a hypothesis, which you are trying your damnedest to disprove. If you go in trying to prove that you were right, guess what? That’s exactly what you’ll find.
Instead, if you go in with a high degree of skepticism and a commitment to pushing beyond “yes/no” answers and vague “sounds like a good idea” statements, and still find that people are yelling/anguishing/laughing/cheering over your problem statement, then you’re safe to continue.
At this point, we move into what most of us have traditionally known as product management - envisioning requirements, prioritizing, identifying constraints, pricing, working with engineers to get the thing built.
Of course, the product manager who is also a practitioner of customer development doesn’t stop getting feedback after that initial phase — they continue talking with prospects and customers to refine and to collect more detailed feedback as the product emerges.
Customer development is also an opportunity identification tool. If you’re a product manager in a more mature organization, you are less likely to be looking for a whole new problem to solve or a whole new product to create — your company already has customers and product lines.
It’s easy to think, “these people are already our customers; we don’t have anything else to sell them: what’s the point?”
The point is, even customers who are happily paying you may not be using the product the way you expected them to. They may love your product — but also wish they could do X and Y. They may not even realize that they’re doing something that is time-consuming or expensive or resource-intensive — where you could save them time, money, or people by introducing a new feature or way of using your product.
In traditional product organizations these opportunities usually come through VOC (voice of the customer) feedback. But customers are often unable to articulate what they need, especially if it’s something they don’t even realize is a problem. The active “pull” of customer development interviews, as opposed to the passive “push” of VOC, gets richer feedback (and guarantees that you aren’t being unduly influenced by your “squeaky wheel” customers.
Popularity: 11% [?]
September 22nd, 2011
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Last week, I wrote a blog post in which I said,
The answer to any question that starts with “do you want” or “are you concerned about” will always be “yes”.
I wanted to expand on that a little bit more, because most product managers will need to understand whether their customers really do value a certain feature or value, and they’ll need to understand the obstacles that potentially prevent someone from becoming a customer.
The reason for this phenomenon is that “wanting” is free. It doesn’t cost your prospective customer anything to “want” feature X, customization Y, added security, privacy, or fiber.
To change this dynamic, you need to make “wanting” no longer free. (A more sophisticated version of this is conjoint analysis; but I’m just going to talk about the simplest level.)
How do you put a cost on customers “wanting” things?
- Stop asking yes/no questions. It’s way too easy to say “yes”.
- Insist upon details. This doesn’t mean asking for customers to define the features they want (99% of them won’t be able to anyways), but ask how they would use it, in what situations it would be beneficial, how their life is worse without it.*
- “Think out loud”a cost. “So, if this would regularly save you 2 hours a week, and your time is worth at least $20 an hour, then you’d be gaining $40…?” (Note: this is not asking people what they’re willing to pay, which they won’t answer anyways, but it gives you some insight into order-of-magnitude — if someone goggles at this question, it probably means they were thinking they’d pay $4, max.)
* This caught me out just the other day: someone had me on the phone for a customer development interview and I said I was interested in some feature. Well-trained, the interviewer asked me to tell him more about how it would make my life better… and I totally drew a blank. You caught me, I said, theoretically it sounds interesting but I can’t tell you why, which means I probably wouldn’t pay money or change my behavior to get it.
One of my favorite anecdotes around “wanting” dates back several years, to when I was working with a client on usability tests. My team had produced the prototypes and handled all of the administration around getting and compensating participants; the client’s user researcher was on hand to ask additional questions (and spy on us because she was clearly suspicious that we’d managed to set up in 1 week the type of testing sessions that typically took her team months.)
The app we were testing was in personal finance, so the user researcher insisted that we ask about privacy.
Despite my objections that constructing a yes/no question would get biased data, the user researcher asked each participant, “Are you concerned about privacy when it comes to your financial information and identity?” Of course, they all said “yes!”
As the final person said yes, I jumped in: “Thanks for participating in our test. We have your $50 check ready for you – here an evil little glint appears in my eyes — you just need to write down your social security number and mother’s maiden name for our records.”
I waved the check; the guy said “OK,” and reached for the sheet of paper and pen.
(I didn’t actually let him write it down! But here he was, “very concerned about privacy…” — but not concerned enough to give up $50 for it!)
Popularity: 8% [?]
September 15th, 2011
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- Whatever people say they will pay for it is wrong.
- If someone says, “I wouldn’t personally use it, but I bet other people would”, no one will use it.
- The answer to any question that starts with “do you want” or “are you concerned about” will always be “yes” .
- If someone says “maybe it’s just me, but…” — it’s not. Especially if it pertains to your product being hard to use or your marketing being unclear.
- If you want to charge money for your product, don’t talk to people who try to get everything for free. (They might eventually be customers, but not until your product goes more mainstream or becomes a defacto standard.)
- What features your customers ask for is never as interesting as why they want them.
- Almost anyone will do almost anything for you as long as: the request is short, you are enthusiastic, they don’t have to make any decisions that require more than 1 minute of thought.
- The two driving forces of purchase and usage behavior are apathy and the desire to avoid looking/feeling stupid.
- You can’t build a good product if you don’t genuinely like the people who’ll be using it. You don’t have to be like them, but you have to like them.
- Whenever you start thinking “this is a lot more complicated than I originally thought”, you should immediately stop and find a sounding board. You are probably either wrong or overthinking things, and an external brain will see it much faster than you.
Popularity: 32% [?]
September 8th, 2011
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