Most successful entrepreneurs, those who graduated from the Lean Startup school of building stuff, will say that the first thing you should do before writing a line of code, before hiring a developer, before naming your product or as much as drawing a wireframe - you should get out of the building and find out if anyone needs what you want to build. And if they want it enough to pay for it.
In short, Customer Development.
As Alex Chaidaroglou points out:
"...once you have done a great job at customer development, nailing your product’s value proposition, overcoming objections both verbally and through your product, building out your marketing plan and pretty much everything becomes much easier."
Because if you skip it, chances are, you’re going to drown hundreds of hours and thousands of dollars in a business idea that doesn’t make sense.
But what if you already built something and still don’t know who to sell it to?
Or you identified your primary market, but it’s not yielding as much growth as you expected?
Here are several reasons why you might be at a dead end and what do do about it.
- You’re going off your gut feeling and assumptions instead of talking to current and potential customers to see if your assumptions are right.
- You think you know, but you don’t know your ideal customers.
- You’re trying to sell features when your customers want solutions.
#1 You think you know your product best
Some entrepreneurs think like misunderstood artists. That it’s the user’s job to understand the brilliance of the product. And they watch their business burn, waiting for their due recognition to come.
Tech products are not works of art. They exist for their users. If they’re hard to understand, it means they’re badly designed or thought-out. Even complicated behemoth systems like Salesforce can be described in one sentence that clearly states what they do and what you need them for.
Some entrepreneurs make a great product, but users use it for a totally different purpose than intended. That’s a great thing. We should be so lucky as to accidentally discover a new market with built-in access to customers. All that’s left to do would be changing the copy and adjusting the product roadmap.
It doesn’t matter what you intended your product for if people don’t use it that way.
Of course, rules of the game change when you have more customers. If you’ve found enough customers by selling the product on your terms, and some people use it differently, they’re just outliers.
But if no one is buying what you think you built, but they want to pay you for something else, take the money and listen to them, they’ve done market research for you.
And ask for referrals.
#2 You are not selling it where you should
If you state the exact problem you designed a solution for, finding users comes down to finding the place where people with that problem are, and reaching out to them. Be it online forums, Quora, Reddit, your LinkedIn network, LinkedIn groups or a local meetup.
If you’ve made an app to connect vendors at the Farmers’ Market, that’s where your users are. If you’ve made a simplified and lightweight Photoshop, your users are wherever you go to search for Photoshop tutorials and complain that it crashed your computer again.
Go talk to the people who need you. Put a relevant ad right in their face and send them to a survey or an email subscription page, or better: talk to them personally. Send them a message, an email, make a phone call if you dare.
If they don’t want to pay for your solution, ask them why.
Talk to them about their problem first, then how they would solve it, or how they are already trying to solve it.Then talk about how you would solve it, and what they think about it.
Customer feedback is king.
Calm down, Content.
#3 You've got tunnel vision
If you didn’t design your product around a pain point, but around features, you need to fit it into an existing pain point anyway. Selling a new feature is much harder than selling something people are already looking for. We are much more likely to act to relieve a pain than to seek out something new.
So, what is your product for?
Is it a function that people are actually googling for?
If they’re not googling for it, what are related products and features they are looking for?
What other problems are they dealing with and where do they go to talk about them?
So let’s say you made a bot that sends me a text message when I enter my favorite shoe store for the third time this week. It reminds me all the reasons why this is not going to end well for my bank account.
You could try to sell me this bot three ways:
- Show me an ad where I’ll see how this bot would improve my life. But I’m ad-blocked up to my teeth.
- Find a support group where shopaholics look for coupons. I mean advice on how to quit shopping. Totally.
- Actually I mean coupons, too. Because people with a given problem do more than one thing at once. They can both try to quit shopaholism and try to minimize its harm by
shopping morelooking for coupons.
- When doing your customer research you might realize that your target customer is not only the person suffering from that problem. It’s also their spouse or best friend.
If you start with the pain point, you start seeing more options of where people with that pain would go. Most people don’t look for an SMS bot.
Another thing to do: you can research similar products, with similar features. Where can you find their users and who are they? Pro tip: ever since companies started doing customer support on Twitter, it’s full of unhappy customers ready to be poached.
If people are not looking to solve a problem you’re solving, maybe they don’t think there’s a solution? What are related questions they are asking, somewhere where you can find them and ask if they’d like to talk to you about related-problem-x?
If people are not interested in booking a sales meeting, asking for a customer development interview might be easier (because you’re building a solution to help them). You can try following that interview with a sales chat, if it goes well.
#4 You confuse users with customers
Enthusiastic users who give you a lot of feedback are, in a way, more valuable than some customers.
But beta users and feedback will not pay for your server or feed your fish.
And beta users, or your very early adopters, are usually a different kind of user than your target group - early majority.
So before your non-paying users move on to the next thing, or before you grow old waiting for them to start paying, ask them:
- Do they know someone who could find the product valuable? (Go wild with referral incentives.)
- How would they describe your product to someone else? (And is that description an actual recommendation?).
- How painful would it be if they couldn’t use your product anymore? And would they pay to keep using it? If not, why?
- Do they know of a better or cheaper alternative to your product? Excel spreadsheets and .txt files count, too.
And if you have paying customers, ask them the same questions.
If users don’t want to pay for your product, they’re either the wrong target, or your product doesn’t give them enough value.
Chances are, it’s not you, it’s them. If you found your first users in a place like BetaList, they were never your target customer. But if you’ve gone out looking for potential customers, got to the right people, who use the product but don’t want to pay for it, that means it doesn’t give enough value, or it addresses a problem that they can work around on their own.
Or that problem is a non-problem.
#5 You think you already know your Ideal Customer Profile
To quote Steli Efti, to build that profile you need to research your current successful customers:
"If you can’t come up with 10 customers, drop everything else and focus on getting these 10 ideal customers. Either support some of your existing customers over to the top until they reach that level of success with your solution, or bring in new companies and onboard them to ensure their success with your solution."
You always start with an ideal customer profile to get your first customers, but do you verify that profile as you keep growing?
Your ideal customer profile must be based on actual data to be of any use.
And it’s also different at every stage of the buying process.
An ideal customer is not someone you envision as a persona that fits your brand’s image. It’s a similar user to those you are already helping succeed. When you interview your successful customers - those who say you save them actual time or earn them money or bring any other irreplaceable value - listen carefully to what they attribute their success to.
Is it a built-in feature or a unique way they use your product?
When you identify several successful customers, find similarities between them.
Focus on the actionable data. If you don’t know how to find new customers based on age or company size, or gender - it’s not an important characteristic.
#6 You don’t know who you’re selling to
Pitching a product to investors is a completely different conversation than selling to customers. Investors don’t need to use your product. They care about your personal brand and positioning. They may care about your target demographic, because they keep track of the industry and know what is likely to succeed in it.
But when you sell to customers, you have to focus on what they need and the value you bring to fulfill that need. You focus on their pain. You bring a new hope. A cure.
When you sell your brand, with your millions of annual revenue, you can focus on looking cool.
When you open-source your code or try to hire engineers, you can talk about the sophistication of your features.
#7 You’ve painted yourself into a corner
When Slack came into the team chat market, their main competitor wasn’t HipChat, or IRC.
It was e-mail.
Yes, both HipChat and IRC were dominating their niche, but Slack didn’t just pull the rug from under them. It made more rugs. Instead of trying to dominate an existing market, Slack expanded it by addressing a problem that people in a different niche didn’t know could be fixed. Instead of making a Gmail plugin to organize messy reply-all email threads, Slack liberated people from the threads altogether and showed them how to communicate differently.
Yes, people already knew group chat was a thing, but most of them didn’t know it was related to group email and could get rid of that everyday annoyance completely. They thought reply-all email threads were a necessity that could only be managed, not fixed.
Instead of trying to fit into a niche, Slack addressed a more universal pain. When you start with a pain point, instead of trying to make a better version of something that already exists, suddenly the box of a market niche pops open.
Of course, there’s nothing wrong with making a better version of another product. Having competition gives you the advantage of not having to find your way in the dark. The market is researched and benchmarked. Poaching unhappy customers is a tested customer acquisition method. There are many other upsides of that situation. But that’s a conversation for another time.
Customer development is not just the pre-launch part of business. It’s a method of testing your assumptions at every stage. Customer development is a series of interviews rather than polls. It’s insight that no bounce rate analysis in Google Analytics will explain. Answers that you won’t find in a market research report.
So before you declare your product done, before you launch an aggressive ad campaign and wait for results that will never come - go talk to potential and current customers, 1-on-1.