Customer Development

Customer development is a four-step framework, originally identified by Steve Blank, to discover and validate that you have identified a need(s) that customers have, built the right product to satisfy that customer’s need(s), tested the correct methods for acquiring and converting customers, and deployed the right resources in the organization to meet the demand for the product. The framework provides a way to use a scientific approach to validate assumptions about your product and business.

The four steps of the framework are:

  1. Customer discovery – Understand customers and their needs that you may be able to satisfy.
  2. Customer validation – You have a product that will satisfy your customer’s needs.
  3. Company/Customer creation – You determine whether your product will satisfy all the customers needs
  4. Company building – You can grow your organization in order to support the demand for your product.

 

Customer discovery can be described as:

  1. Identify the need.
  2. Hypothesize potential solutions.
  3. Identify assumptions.
    • Business Environment
    • Dependencies
    • Minimum Requirements for a solution
    • Change Management Requirements
  4. Validate Assumptions
  5. Start Delivering
  6. Constantly Reevaluate your Solution

Understanding Customers

  1. Recruit the right prospective customers, existing customers, and non-customers.
  2. what goals or jobs customers are trying to get done.
  3. how they currently go about solving certain problems
  4. what decision-making process they followed to decide on their current method. Ideally, you want to understand their decision-making criteria and each criteria’s relative importance.
  5. Identify parts of the process that they consider highly valuable but cause the most pain, if possible.
  6. Propose your product concept or prototype (this can take any shape from a PowerPoint presentation to a working minimum viable product). Ask your interviewee how the product can be improved rather than just asking if the product meets or doesn’t meet their needs.

How do I find potential customers to make sure my idea has potential?

1. AdWords or Facebook Ads or Tweets- Summarize your idea, invest some money in getting it in front of people who have expressed intent by searching for that term, clicking your ad, clicking a link, hashtag saved searches.

2. Look for people who have already discussed a similar product, problem, or solution and address a tweet directly to them:

@username Would love yr feedback on [product/problem/solution] – shd only take 2mins [URL] thanks!

3. Google Alerts – Set up Google Alerts for your product/problem/solution and when it finds relevant blog posts or comments, email those people and ask for their feedback:

I read your [post/comment] about [product/problem/solution]. I’m currently trying to validate a related idea and I think your opinion would be very valuable to me – could you take 2 minutes and check out [URL]? Thank you – I’d be happy to return the favor any time.

4. Ask for introductions – People are generally happy to make introductions for you, provided you do 3 things:
•Provide the exact text that they can copy and paste into a tweet or email
•Tell them exactly how you are going to communicate with their contacts
•Tell them your goals (What do you think you’ll get/learn if they make this intro for you?)

Email Request Template

I have a quick favor to ask.

I’ve got a product idea that I’m trying to validate with [type of customer]. My goal is for them to visit my splash page at [URL] and indicate their interest (or lack thereof). I will only contact them if they explicitly give me permission to do so.

Could you send this message along to people you know who fit this target? (Feel free to change it a bit if you like):

[Message – be sure to include the goal, the URL, and your contact information]

Twitter Request Template

I have a quick favor to ask.

I’ve got a product idea that I’m trying to validate with [type of customer]. My goal is for them to visit my splash page at [URL] and indicate their interest (or lack thereof). I will only contact them if they explicitly give me permission to do so.

Since you have a number of followers who are the type of customer I’m trying to reach, could you tweet this for me? (Feel free to change a bit if you like):

[Message – include the URL, the topic, and keep it under 115 chars so it can be easily retweeted]

Asking for the Interview

You may be wondering, “so what is this URL I’m sending people to? Can’t I just have people email me?”

You have three main goals with your splash page:
1. Communicate your idea in 10 seconds or less (seriously, that’s about how much time you have to grab someone’s attention)
2.Offer something interesting to the people who visit
3.Get contact information so you can ask for the interview

#1 is up to you (there’s a whole other blog post I could write about that…).

#2… when I say “offer something”, people generally think that means a tangible incentive. You can, but you probably don’t need to – people like being asked for their expert opinion, they like the feeling that they’re contributing to something, and they like being part of a select group who gets a sneak preview at something.

You can cover #2 and #3 with a well-written survey template. You can see the one we’ve used for the Survey.io beta, or here’s a partial screenshot:

custdevsurvey__

What should I be learning from the customer development interview?

•How is your customer currently dealing with this task/problem? (What solution/process are they using?)
•What do they like about their current solution/process?
•Is there some other solution/process you’ve tried in the past that was better or worse?
•What do they wish they could do that currently isn’t possible or practical?
•If they could do (answer to the above question), how would that make their lives better?
•Who is involved with this solution/process? How long does it take?
•What is their state of mind when doing this task? How busy/hurried/stressed/bored/frustrated? (note: learn this by watching their facial expressions and listening to their voice)
•What are they doing immediately before and after their current solution/process?
•How much time or money would they be willing to invest in a solution that made their lives easier?

  • What are you trying to accomplish?
  • Why do you think this is so hard?
  • How does that affect things?
  • How does this affect the rest of the team or your family?
  • What were you expecting out of this?
  • What do you think the main issue here is?
  • What’s the main thing getting in your way of being successful?
  • What would a change in this area mean for you?

Example:
Tell me about how your household handles grocery shopping…
How is that process working for you?
Have you tried other approaches, like online grocery delivery or keeping a list on your iPhone?
If you could improve anything about your grocery shopping routine, what would it be?
If you had a cost comparison tool, how would that make your life easier?
What people in your household buy groceries?
What do you do immediately before you go grocery shopping?
What do you do immediately after you go grocery shopping?
Would you be willing to spend some money to get a cost comparison tool or other tools that would make your grocery shopping easier?