You can practice customer development on all types of customers.  But you can’t treat them all exactly the same.

“The rules are different when you’re talking to large enterprise customers,” say enterprise organizations.

This doesn’t work when you’re dealing with customers who are already using your products and have certain expectations,” say small business owners.

“You can’t experiment when you’re subject to laws and restrictions,” say product people in heavily regulated industries.

Yes and no.  YES, the techniques I write about on this blog WILL work on your customers.    NO, you can’t blindly apply them in the same way to all types of customers.

So how DO you approach your target customer?  What tactics will you need to adapt or omit?

In this post, I’ll talk about interviewing these customer types:

  • Consumers.  B2C. Someone who is going to directly pay for your product or service.
  • Small business owners.  Someone who is an expert in their field but likely to be technically novice (or just ambivalent towards it)
  • Technology startups. Someone who seeks out novel solutions and embraces change.

Much of “what works” in customer development is universal – it’s social psychology. But as I’ve worked with and mentored companies across a huge variety of customer types, these are some “differences” patterns I’ve noticed.

Consumers

  • “Cold contact” methods are much less effective. Consumers tend to be more suspicious that you’re trying to sell them or scam them; they can also be fearful that a cold email means their privacy has been violated somehow.
  • More likely to be polite than honest. Talking to a person in a consumer context is seen as more of a social engagement than a business one — and most people have been trained to be pleasant and avoid conflict in social situations.   Any question that can be answered with “yes” — will be.  “How” and “why” questions will allow consumers to be more honest without feeling uncomfortable.
  • Cost matters much, much more. It’s also more situational.  It only makes sense, right? If I’m paying for a product myself (as opposed to charging it to my company), I’m going to think a lot about parting with my $5 or $500.   (The opposite also applies: I might tell you a product isn’t worth the money, but after a tiring emotional day I might deem it worth a spur-of-the-moment splurge.)
  • Time is undervalued. Most people are terrible at estimating how much time they spend on a certain task, how much time they waste, how long they spend on various activities.   In a work environment, we are more likely to have deadlines, be paid hourly, fill out timesheets – any of those activities make people at least somewhat more aware of their time usage.
  • Don’t forget about “external stakeholders”! Just because a consumer doesn’t need to seek approval from their boss or finance department doesn’t mean there aren’t additional people who can and will veto your product.  Family members may refuse to use a new product; friends may express disapproval of changes.

Small and mid-sized non-technology businesses

  • Be specific and concrete.  You’re competing with the customers already walking in the door and the processes that already work ‘good enough’ to service them. Asking about specific tactical activities and outcomes is more likely to engage SMB folks than aspirational/”vision” concepts.
  • Too busy to simply be motivated by “feeling smart”.  I originally wrote this as “less motivated by…” That’s not quite accurate: it’s just that SMB owners are too busy to only appeal to their vanity!  Offer them value like answering questions, sharing data, sharing curated content, making introductions for them – that’s how you’ll get them to agree to give you some of their time to talk.
  • “If it ain’t broke, don’t fix it” mindset. If consumers are more likely to say “yes” (even if they don’t really mean it), SMB people are more likely to say “no”.  There are fewer people to absorb the impact of a learning curve or cleaning up a failed experiment.

Technology startups

  • Harder to keep them focused on PROBLEM not solution. We can’t help it.  We spend our days building and designing, so we naturally slip into talking about solutions.  You’ll need to actively refocus the conversation, maybe many times, on the what/when/why questions.
  • Easiest to reach via “cold contact” methods. As long as you’re brief, non-spammy, and respectful, you’ll get a high response rate from emails, Twitter, and follow-ups from finding people on social media/topical forums.
  • Overly optimistic/aspirational. We set really high goals for ourselves, which often means we’ll tell you about all the things we want to do, intend to do, aspire to do … but never actually get around to.    Like the consumer segment, if we can answer ‘yes’ to a question, we will.
  • We like sounding smart AND information. You can get an initial conversation with a technology startup person just because we love talking and thinking about stuff.  But you can build an ongoing relationship by following up with a summary of your learnings, intel on what other companies are doing (anonymized, of course), or offering us sneak previews of what’s coming next.

 

Find this post useful? I’ve written much, much more in my new book, Lean Customer Development.
You should get Lean Customer Development now!

When I originally wrote this post, it was titled “What does a validated hypothesis look like?”  But that’s not entirely accurate.  A validated hypothesis requires more than words: it requires the customer to pay money, to pre-order, to invest learning time or social capital.  That’s actually incredibly easy to spot.  Either you’ve got cash in hand or you don’t!

But what about the hypothesis that hasn’t quite been validated?  There are many times when this happens:

Some positive signals + You assuming you were right = Something that looks like a validated hypothesis – but isn’t.  Let’s call it a “Wishful Thinking” Validation.

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.
  • Customer pays money / gives a credit card # / signs a letter of intent / commits to learning or training / agrees to a pilot program

In many cases, you may need to invest time, money, and resources before you can get to that last component.  But if you’re honest with yourself, you can spot an invalidated hypothesis much sooner.

So what does an invalidated, or “wishful thinking” validation actually look like? 

It can be hard to tell the difference between “yes!” and “maybe…” responses.  That difference can waste a ton of your money and time.

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.

If you offered a pre-order option, there’s a good chance Freda would give you her credit card number.  Jasper would not.    Are your prospective customers Fredas or Jaspers?  If the latter, something — either your product or your market — needs to pivot.

Find this post useful? I’ve written much, much more in my new book, Lean Customer Development.
You should get Lean Customer Development now!