July 28, 2014

Customer Development: Where To Start?

The Lean Startup by Eric Ries is a great book to apply lean principles to build your products or services. It's a fascinating approach that every entrepreneur should have in mind before starting anything.

When I started working on BunchCast, the first vision was to help bloggers create better content. I started by working on a product and building features. When I showed my product to potential targets, a few weeks later, they only saw a bunch of features they didn't care about. After our pivot, we took the advice of Steve Blank and started doing some Customer Development.

The first thing to do when choosing a new challenge to work on, is to listen to your target market. To do this, Steve Blank and Eric Ries proposed a great toolset to help entrepreneurs get out of the building and meet real people. Customer Development is the term coined for that practice.

Achieving Problem-Solution Fit

A great idea starts with a great problem to solve. You should look for a crowd who has a painful problem you feel you can do something about. Proposing your solution to that problem must lead you to achieve a problem-solution fit. You found a great problem to address and you matched it with your great solution.

The Problem Interview

Once you chose a target audience, you must start to really get out of the building and get in contact with people to do some interviews. Your target audience must come to life with real interview answers.

  • Start by collecting information on the person (demographics)

  • Set the context: explain what your are working on and what you are focusing on to improve the life of your target

  • Get the person's take on that context and try to find out their own pain points

  • Expose the problems you want to address in that context and ask the person a ranking : which problem is the most important one?

  • Ask if solving each problem is a "Must Have", a "Nice to Have" or a "Don't Need"

  • Wrap up the discussion, get contact information, ask for follow-up and referrals.

Once you get 10 problem interviews, you will be able to work with actual data and may be able to go to the next phase.

The Solution Interview

Your problem interview data is here to prove the problem you are addressing is real and a "Must Have". Now you are sure there is a real problem, try to create a prototype for a first solution to propose. You can use a simple wireframing tools like Balsamiq but even a good UI Kit in Google Docs can do pretty well. The goal is to create a first idea of a solution that can answer your target needs.

NB: I work in Software development and I like to use frameworks like Foundation by Zurb. With that, You can build an interactive prototype that looks like a real product.

Once your first prototype is ready (or wireframes), you are ready for the first round of solution interviews.

Before going to interviews, think about a pricing. How much value do you think your solution will bring to your target? What chunk of that value would you think they are prepare to pay you in exchange of your solution?

  • Start by collecting information on the person (demographics)

  • Set the context: explain what your are working on and on which area you want to improve the life of your target

  • Test your solution: Show your wireframes or prototype. Guide your target through the steps. (You aren't optimizing user experience or analyzing you capacity to onboard here)

  • Test your pricing : Ask your user, if they would agree to pay $X or $Y/month for your solution. If not, and only then ask how much they are willing to pay for this (or if they are willing to pay at all)

  • Wrap up the discussion, get contact information, ask for follow-up and referrals.

After each interview, you must document the feedbacks and update your solution proposition. Maybe some features are validated and can go straight to development? Maybe some must be deleted because nobody wants them? Is there a good fit between the solution and the pricing?

Polish your wireframes and pricing after each interview to get better feedback. Also, think about A/B testing to get the audience reactions on different propositions.

If you want to learn more about this in details, I recommend you read the book from Ash Maurya called Running Lean. Every step of the process for customer development is described with real business cases.

Thanks for reading this little introduction on Customer Development. Comments are always welcome below.