8 “Epiphanies” of a Customer Development Rookie

At the heart of the Lean Startup model are the concepts of Customer Discovery and Customer Development.  They are simple concepts of forging relationships with potential customers during early-stage product development with the goal of ultimately going to market with a product that customers want to buy (what a novel concept….I know!).  This customer interview process is something Steve Blank calls “getting out of the building” — essentially, leaving your development lab and office, and getting in front of potential customers to ensure you are developing a product that solves a fundamental problem that they have.  I had never formally gone through these customer interview processes before, and honestly I had been a little skeptical initially — but not anymore.  What I’ve learned in a matter of 3 days of “getting out of the building” has been overwhelming…

Ever since I learned about the Lean Startup concept, I’ve been a huge advocate.  The methodology just makes sense.  After reading Eric Ries’ The Lean Startup, Steve Blank’s Four Steps to Epiphany, and Ash Maurya’s Running Lean, and countless excellent blogs on the topic, I decided that it was time to “get out of the building” and begin interacting directly with our Tether customers.  Just to be clear – before learning about customer discovery and development, we always thought we were doing all we could in terms of customer engagement – forums, email, Twitter, Facebook, and surveys – we had assumed that that was enough.  But the more I read and after listening to Ash Maurya in a recent seminar, I quickly came to the conclusion that I had to start speaking with customers directly.  Most importantly, I realized that (one of the founders) had to do it — and that it wasn’t a task I could, or should, assign to anyone else.  The timing was also perfect since Tether is in the midst of an exciting new development – so I figured there was no better time than now to give this process a shot for the first time.

So I had my marketing team blast an email to a small set of people (~125) who had signed up on our new product launch page.  What I’ve learned, in simply the first 3 days of this “experiment”, has been awesome.  I now get it – I get the value, importance and need for this activity as a young startup company (and founder)…and so too does the rest of my team.  Even though I’ve only been doing this over the last few days, the lessons have been many.  Here are the 8 “epiphanies” I’ve had in my early experience with “getting out of the building”:

  1. Customers are Willing Participants:  We began by emailing 125 potential customers, having no idea what kind of response we would get.  My expectation was that roughly 10% would be willing to participate in a call.  To my surprise, many more were willing to help out.  Already, we’ve had over 20% of those emailed willingly participate – very cool.  The startup world is changing quickly – customers want to be involved in product development.  The days of “secret” product developments are over.
  2. Customers are Accommodating: In Running Lean, Maurya highlighted the challenge of booking / coordinating interviews.  As a result, I was concerned about how difficult this would be.  I looked at using Tungle.me to schedule these calls, but I found that the interface and process were cumbersome and didn’t like the thought of potentially getting stuck with calls dispersed randomly throughout my week.  Instead, I decided to try something simple.  I emailed each interested customer (those who responded to my original email) a proposed time for a call (booking them in sequential 1/2 hr time slots within 3-4 hour sessions throughout the week).  Surprisingly, over 90% of those willing accommodated my suggested time, which made for densely-packed, time-efficient interview sessions.
  3. Customers are Flattered:  When I first sent out the email to these customers, I felt like I was asking for a pretty big favor.  Essentially I was requesting 15-20 minutes of their valuable time so I could learn how to build a better product (which ultimately benefits my startup).  Instead, I’ve received an overwhelmingly positive response from the customers that I’ve spoken with – many whom have thanked me for calling!  Several also seemed pleased that the CEO was making these calls.  One customer went as far as to post a thank-you on our Facebook page for the call and said how cool it was for a company like ours to be reaching out to its customers for feedback.
  4. It’s a Team Learning Experience:  As the Lean Startup methodology suggests, there should always be more than one person involved in the interview.  I’ve had a new marketing employee working with me on these calls, which helps in terms of collecting data and taking notes.  But I’ve decided to take it one step further  – I’ve chosen to do these calls on a speaker phone in a common, open work area with my business partner and several other senior employees in the room (working while I’m on the call, but listening in all the same).  This way, our team gets to hear the customer responses first hand – and we collectively debrief after every call going over the important details that we heard in each customer interview.  It is a great team learning experience to hear the feedback directly.
  5. Responses Converge Quickly:  Tether has a very diverse user base and when I first decided to begin this customer development process, I figured that we would need to talk to a lot of customers before getting a good feel for all their specific needs/wants for our new product.  What we are seeing, however, is after only ~20 interviews the feedback is quickly converging on similar results and trends are establishing.  What users want, what they want to pay, what they think is most valuable, and their primary problems are all very similar.  This is fascinating to us – and highlights that the investment in time doesn’t have to be weeks or months of interviews to begin identifying valuable trends, but rather several days and 10’s of users can quickly provide you with basic data you need to make early-stage, pivot decisions.
  6. ROI:  Admittedly, I was skeptical whether these kinds of interviews were the best use of my time.  I questioned what kind of ROI I would get on this kind of time investment.  Within the first three interviews, I was sold.  There is no question in my mind now that talking directly to customers is one of the most valuable uses of my time.  The information and feedback that customers are willing to provide us with is awesome.  Don’t discount the potential ROI – it is worth the time invested.
  7. Founders Need to Call:  For many technical founders like myself, often times making calls is not a natural talent.  However, what ever you do, don’t pass this task off on someone else on the team (like a young, outgoing marketer).  It is critical that one of the founders makes these calls.  They are the ones with the vision – they have to be present.  For a young startup, I’m quickly beginning to see that there is nothing more important for the founders than to be actively involved in this customer development process.
  8. Give Yourself Time:  Although our interviews last only 15-20 minutes, I’m intentionally using 30 minute time slots.  It allows our team to quickly debrief after every call and get our notes in order.  It also provides some time for coffee (and bathroom) breaks and gives a little buffer for those customers who really want to chat while still allowing you to stay on schedule for subsequent calls.  I would recommend that when starting out – give yourself a little extra time for these reasons.  As a courtesy to those customers who have volunteered their time, be sure to stay on schedule!

For those of you who have been considering jumping into this process – the time is now.  Regardless of the stage of your current startup, there is huge value in reaching out and talking directly with your customers.  As important as social media is in communicating with your customers – being “social” with a simple phone call, or better yet in person, makes a huge difference.  As one of our interviewed customers highlighted, “…taking the time to ask customers (their opinion) is priceless”!

If you enjoyed this article, please subscribe and follow me on Twitter (@tburke_quark) for more on tech startups, entrepreneurship, leadership and innovation – thanks!

Advertisements
Tagged , , , , , ,

One thought on “8 “Epiphanies” of a Customer Development Rookie

  1. […] in action with an up and running company – its not just startups. From (@tburke_quark) http://techstartupgame.com/2011/10/20/8-epiphanies-of-a-customer-development-rookie/ Thanks to @davidfeldt for bringing it to my […]

Please leave a reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s