Three Important Areas of the Customer Discovery Process
If you are a startup, you have probably heard the words “customer discovery.” While there are lots of good resources that teach how to do effective customer discovery, many startups I see fail because they did not do adequate customer discovery to prove it was a must-have problem that customers were willing to pay for. I’m not going to rehash how to do customer discovery, but rather focus on several areas that often do not get enough attention and are imperative to get right. A great book to read on this topic is The Mom Test.
Problem vs. Solution
Too often entrepreneurs fall in love with their product/solution before truly understanding the problem. Instead, start first by understanding the current pain points for potential customers without leading them on. It should be in their words about specifics of their workflow and challenges; not about your idea. Get specific to understand tangible examples of their problem and details on the last time it happened. It is too easy to talk in generalities/hypotheticals and get customers to say what you want and improperly conclude you have found a need. As you start to learn more and validate the problem, only then should you do more discovery into potential solutions.
Get specific to understand tangible examples of their problem and details on the last time it happened.
When doing customer discovery, I always like to track things about the person/company I am speaking with (industry, company size, role, geography, experience, etc.). Inevitably there are different cohorts of potential customers that may not have the same feedback. Being able to effectively determine the similar problems for a defined cohort is critical to moving you towards an ideal customer profile and solving those pain points in that specific segment. Be careful lumping all feedback together into one group. Remember, as a startup pick one segment to target first; do not try and serve all segments from the beginning or you will end up burning a lot of time/money and serving none!
Must-Have Product and Willing to Pay For It
I hear entrepreneurs tell me all the time that customers think they have a great idea. However, people are inherently nice and the majority of those customers probably won’t pay for it. One test is to prove that this is a must-have problem (in the path of revenue or mission critical workflow) vs. a nice-to-have. Another test is to determine are customers already paying something for a solution to their problem or are they trying to do it themselves internally. If yes, how much and what do they like/not like about the current solution. If not, why have they not paid for a solution and what would they have to believe in order to try a new solution. Don’t be afraid to dig in; in most cases if they are not already trying to solve the problem it is likely not a must-have.
I prefer to leave customer discovery with validation of a must-have problem for a target customer segment, verbal proof that customers are willing to pay for a proposed solution, development partners to be the first beta customers to build the product with, and ideally, customers pre-paying for the MVP.