Entrepreneurs often come up with an idea that is brilliant in their opinion and begin to create a product without preliminary analytics. As a result, the founders have a working product, but no users or customers. Only after that they start talking with potential users and find out what the target audience really needs.
If you start your own business, you become a product manager at the same time. You must take a rational and customer-centric approach – create MVPs based on feedback, collect quantitative and qualitative data, and make all decisions based on customer feedback.
This article explains what customer development is and how to avoid product failure through interviews.
What is customer development?
Customer Development is the practice of establishing ongoing relationships with your customers to identify opportunities and mitigate risks.
Communicating with customers helps you generate ideas, test hypotheses, get feedback, and modify your product to achieve the ultimate goal of product-to-market fit.
Assumptions and hypotheses
Before talking to clients, write down your assumptions and hypotheses.
Your assumptions are expectations about customers and the reasons for their behavior, as well as what will help the business become profitable.
Write down your assumptions and fill them in a spreadsheet with two variables: risk and difficulty.
Risk refers to how important it is for this assumption to be true for your business to work. The difficulty level indicates how difficult it is to test and confirm your assumption.
After creating a table, describe your hypothesis in the following format:
We think that _ (target user) will be _ (predefined action) _ because _ (reason) _.
We believe that residents of the area will buy household goods in our store, because we are within walking distance to the nearest houses and we have low prices.
With whom and how should you speak?
A great way to start testing your hypotheses is interview users… It is necessary to communicate with clients in three stages – during validation, development of the first version and iteration.
Before creating a product, talk to your target audience to see if your product solves a real problem.
Conduct small meetings with them and collect useful data. The main thing is not to try to sell your idea to people. If you convince the person that your product is good, they are unlikely to answer honestly during the interview.
Development of the first version
At this stage, you have no customers, but you can already collect the email addresses of the first users from the landing page.
Your goal is to talk to future users and understand what features to add to the interface.
At this stage, you are improving your product and talking to real users and buyers. These interviews can help them find out if they like your product, who benefits from it the most, and what features can be reduced or added.
Types of interviews
User interviews are the most rewarding way to collect quality data. There are 4 main types of interviews to be conducted:
The most arbitrary type of interview. With it, you can find out if your target user is facing the problem you are thinking about and if they want to solve it.
Ask open-ended questions and listen as much as possible. The more people talk, the more data they reveal. If you are a product manager at a cleaning company, you can ask your audience the following question: “Tell us how often you clean, and could you delegate cleaning to free up time for more important things?”
Once you have hypotheses, you can use this type of interview to test your theories.
To keep the interview objective, avoid bias, listen more and explain your project idea only at the end of the interview. Avoid protecting your ego and tune in to the fact that a lot of the product will have to change. Be honest with the person and let them know that you sincerely want to see their problem and find a way to solve it.
Conduct this interview when you have a working product and customers. It will help you find out how users feel about your service. This will help avoid frustration and optimize the most useful features.
Through interviews, you will learn how to improve the product to better serve its purpose. Ask users when they use your product and why they find it useful.
Remember that during the conversation you should get objective information: who is your customer, what habits he has, when and why he needs your product. If you try to confirm that your product works great, it will fail.
Right and wrong questions
Avoid questions that might influence customer responses. Good questions that prompt honest answers are the key to collecting useful data.
Ask open-ended questions
Open-ended questions allow people to talk a lot and openly about their problems. Ask “what” and “how” questions – they will allow users to answer them in detail and tell as much as possible. Don’t be afraid of silence if they stop. Just nod to show that you are listening – people hate awkward silence and fill the gap by talking more.
Don’t ask leading questions
Avoid questions that default to the answer you are looking for. For example: “I agree with you, cleaning every week is pretty boring. It would be great if you had a cleaning company, right? “
Don’t ask two-choice questions
Such questions are given short and useless answers. Users should speak as much as possible.
Don’t ask questions that might make you lie
Usually people don’t want to hurt someone’s feelings, so when asked, “Do you like my idea?” you put them in an awkward position. As a result, you will not get an honest answer and will fail the interview.
If during the interview you get stumped and don’t know what to say, try asking for details about previous answers. This will continue the person’s chain of thought and gather more information.
Combining qualitative and quantitative data
Communicating with customers is essential to collecting quality data, but remember to combine it with quantitative information. Use Google, Analytics Mixpanel, Hotjar and other platforms to collect reports. This approach will help you to objectively look at your product and make the best optimization decisions.