Customer Discovery

It’s time to move beyond finding the next big thing. We need to find the next big reason. If you really want to know if your winning business idea will work, you need to connect with your customers and find out what they really want.

This is the last of three articles on why business plans often don’t work and what to do about it. In part one we saw the risk of relying on an untested business plan, whilst in part two we saw how the business model canvas can be used as a simple, visual tool to bring clarity to your business model as it moves through a number of pre-launch iterations. Today’s piece is on the discovery mindset that is needed to move beyond analysis and towards reality.

Discover your Business Model

Discovery is a key phase in the development of your business model before you start spending on launch functions like marketing and sales:

The discovery phase is where you get to find out who your customers are, and what business model works best. The temptation for many is to write a detailed business plan with lots of detailed analysis. It’s not enough. You need to stop guessing what your customers might want and find out what they do want. Go and talk to them. Cross the dance floor and make eye contact. True customer insight cannot be gained from a distance.

Use Design Thinking to Build Customer Insight

Discovery teams can use  design thinking to start moving away from their own perspective of what might work, and into the customer’s perspective of they need. The idea is to go beyond what product features are needed, and understand why the product is needed at all. This requires a degree of empathy, and a good dose of direct observation. Here are the basics:

  • Move out of the lab and into the field:  The best observations come from real customers using real products in realistic situations
  • Keep prototypes minimal: Prototypes are used to validate concepts, so you only need to test the minimum set of features needed to prove your point
  • Do it quickly: keep the momentum, and learn quickly and cheaply. Keep iterating until you have something that works … you can finesse it later
  • Find out Why, not What: Most important of all is to learn why customers need the product, this enables you to anticipate change

The Sprit of Exploration

To develop the discovery mindset you will need a sense of curiosity, a willingness to elaborate and follow up on details, and the flexibility to move on from ideas that don’t hold up. It’s no good observing your customers failing to engage with your product if you don’t do something about it. If your business model doesn’t work, change it.

But how do you know how your customers feel about your product? Empathy is all about getting inside another person’s perspective and connecting with it on a deeper level. Without empathy, collaboration is simply a group of people arguing their point of view. To open the doors to collaborating with your customers, try the following:

  • Actively seek out alternative perspectives. How else could our customers view this product?
  • Look for similarities instead of differences, focus on what does work rather than what doesn’t
  • Listen. Hold off on your evaluation and analysis just a little bit longer, you never know… you might just start to understand what your customer’s really want

Summary

The business plan is used to persuade investors to fund your new business, or sponsors to give your business transformation program the green light. But what happens when you get it wrong? For 9 out of 10 business owners and a good proportion of major business transformations, the answer is “you’re fired”.

By building in a period of discovery you can prove the central assumptions that your plan relies on BEFORE you start executing. Failing cheaply, failing early and learning from your mistakes is a far better alternative to making promises you can’t keep.

With a bit of time and the right spirit of exploration, maybe you too can be one of the 1 in 10 who succeed, and not the 9 in 10 who fail.

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One thought on “Customer Discovery

  1. Going out and interacting with consumers is not done enough. Too many times we lean on focus groups to shape product direction, paying others to talk to the consumers, and we call that listening to the consumer.

    I am reminded of this quote:

    I have no special talent. I am only passionately curious.
    Albert Einstein

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