Talk I gave at 500 Startups in March 2015 sharing ideas from my new book on how to apply Lean Startup principles to achieve product-market fit. You can learn more at http://tiny.cc/LPP

1. March 2015

2. Copyright
©
2015
Olsen
Solu7ons
My
Background
n Educa7on
n Engineering
background
n Stanford
MBA
n Web
development
and
UX
design
n Deep
Product
Management
Experience
n Submarine
design
n Led
Quicken
Product
Management
at
Intuit
n Led
Product
Management
at
Friendster
n CEO
&
Cofounder
of
YourVersion,
“Pandora
for
your
news”
n PM
consultant:
Box,
YouSendIt,
Medallia,
One
Medical
Slides
at
hTp://slideshare.net/dan_o

3. What
is
Product-­‐Market
Fit?

5. The
Lean
Product
Process

6. The
Lean
Product
Process
1. Determine
your
target
customer
2. Iden7fy
underserved
customer
needs
3. Define
your
value
proposi7on
4. Specify
your
MVP
feature
set
5. Create
your
MVP
prototype
6. Test
your
MVP
with
customers
Copyright
©
2015
Olsen
Solu7ons

7. Transporta7on
within
100
miles
of
my
home
Soccer
Mom
Speed
Demon
• Carry
kids
&
gear
• Safety
• Fuel
economy
• Go
fast
• Looks
cool
• Makes
me
look
cool
Target
Customer
Has
Dis7nct
Needs
High-­‐level
need:
Target
Customer:
Detailed
needs:
Ideal
Product:
Soccer
Mom
Speed
Demon

8. The
Lean
Product
Process
1. Determine
your
target
customer
2. Iden7fy
underserved
customer
needs
3. Define
your
value
proposi7on
4. Specify
your
MVP
feature
set
5. Create
your
MVP
prototype
6. Test
your
MVP
with
customers
Copyright
©
2015
Olsen
Solu7ons

9.
n Russians:
pencil
n NASA:
space
pen
($1
M
R&D
cost)
Example:
n Ability
to
write
in
space
(zero
gravity)
Problem
Space
vs.
Solu7on
Space
n Problem
Space
n A
customer
problem,
need,
or
benefit
that
the
product
should
address
n A
product
requirement
n Solu7on
Space
n A
specific
implementa7on
to
address
the
need
or
product
requirement
Copyright
©
2015
Olsen
Solu7ons

10. Problem
Space
vs.
Solu7on
Space:
Product
Level
Problem
Space
(user
benefit)
Solu7on
Space
(product)
TurboTax
TaxCut
Pen and
paper
Prepare
my taxes
File my
taxes
Check my
taxes
Maximize
deductions
Reduce
audit risk
Copyright
©
2015
Olsen
Solu7ons

11. Problem
vs.
Solu7on
Space:
Feature
Level
Problem
Space
Solu7on
Space
Save time filing
taxes
Save time
preparing taxes
Maximize my
tax deductions
Check my
return
Reduce my
audit risk
Help me
prepare taxes
Empowerment/
Confidence
Save Time
Save Money
Tax Interview
Wizard
Audit Risk
Analyzer
Tax Return
Error Checker
Tax Data
Downloader
Electronic Tax
Return Filing
Tax Deduction
Finder
Copyright
©
2015
Olsen
Solu7ons

12. Priori7zing
Customer
Needs:
Importance
vs.
Sa7sfac7on
Importance
of
User
Need
User
Sa7sfac7on
with
Current
Alterna7ves
Compe77ve
Market
Opportunity
Low
High
Low
High
Not
Worth
Going
Aher
Copyright
©
2015
Olsen
Solu7ons

13. Kano
Model:
User
Needs
&
Sa7sfac7on
User
Sa7sfac7on
User
Dissa7sfac7on
Performance
(more
is
beTer)
Delighter
(wow)
Need
not
met
Need
fully
met
Must
Have
Needs
&
features
migrate
over
7me
Copyright
©
2015
Olsen
Solu7ons

14. Copyright
©
2015
Olsen
Solu7ons
Importance
vs.
Sa7sfac7on
Ask
Users
to
Rate
for
Each
Feature
Recommended
reading:
“What
Customers
Want”
by
Anthony
Ulwick
Bad
Great

15. The
Lean
Product
Process
1. Determine
your
target
customer
2. Iden7fy
underserved
customer
needs
3. Define
your
value
proposi7on
4. Specify
your
MVP
feature
set
5. Create
your
MVP
prototype
6. Test
your
MVP
with
customers
Copyright
©
2015
Olsen
Solu7ons

16. What
is
Your
Value
Proposi7on?
n Which
user
benefits
are
you
providing?
n How
are
you
beTer
than
compe7tors?
Compe&tor
A
Compe&tor
B
You
Must
Have
Benefit
1
Y
Y
Y
Performance
Benefit
1
High
Low
Med
Performance
Benefit
2
Low
High
Low
Performance
Benefit
3
Med
Med
High
Delighter
Benefit
1
Y
-­‐
-­‐
Delighter
Benefit
2
-­‐
-­‐
Y
Copyright
©
2015
Olsen
Solu7ons

17. The
Lean
Product
Process
1. Determine
your
target
customer
2. Iden7fy
underserved
customer
needs
3. Define
your
value
proposi7on
4. Specify
your
MVP
feature
set
5. Create
your
MVP
prototype
6. Test
your
MVP
with
customers
Copyright
©
2015
Olsen
Solu7ons

18. What
is
an
MVP?
Courtesy
of
Jussi
Pasanen
See
Aaaron
Walter’s
book
Designing
for
Emo-on
Copyright
©
2015
Olsen
Solu7ons

19. Breaking
Features
Down
into
Chunks
Copyright
©
2015
Olsen
Solu7ons
Must
Have 1
Performance
1
Delighter
1
Delighter
2
Must
Have 2
Performance
2
Performance
3
Benefits:
M1A P1A D1A D2AM2A P2A P3A
Features:
P1B D1B D2BP2B P3B
P2CP1C
P1D
D1C

20. Product
Roadmap:
Features
by
Version
or
Time
Copyright
©
2015
Olsen
Solu7ons
Must Have Benefit 1
Performance Benefit 1
Performance Benefit 3
Delighter Benefit 1
Performance Benefit 2
Must Have Benefit 2
Delighter Benefit 2
M1A
Time
v1 v1.5 v2 v2.5
M2A
P1A P1B
P2A P2B
P3A
D1A D1B
D2A
MVP
candidate

21. The
Lean
Product
Process
1. Determine
your
target
customer
2. Iden7fy
underserved
customer
needs
3. Define
your
value
proposi7on
4. Specify
your
MVP
feature
set
5. Create
your
MVP
prototype
6. Test
your
MVP
with
customers
Copyright
©
2015
Olsen
Solu7ons

22. The
UX
Design
Iceberg
Copyright
©
2015
Olsen
Solu7ons
What most
people see
and react to
What good
product
people
think about

23. Gelng
Customer
Feedback:
Problem
Space
vs.
Solu7on
Space
n Customers
CAN’T
ar7culate
problem
space
n Customers
CAN
react
to
solu7on
space
n That’s
why
you
need
something
tangible
to
show
to
customers
to
get
good
feedback
Copyright
©
2015
Olsen
Solu7ons

24. Design
Ar7facts:
Interac7vity
vs.
Fidelity
Copyright
©
2015
Olsen
Solu7ons
Hand
sketch
Interac7vity
Fidelity
Interac7ve
Prototype
Sta7c
Wireframe*
Clickable
Wireframe*
Mockup
Clickable
Mockup**
*
Balsamiq:
balsamiq.com
**
InVision:
invisionapp.com

25. Design
Tools:
Fidelity
vs.
Effort
Copyright
©
2015
Olsen
Solu7ons
Hand
sketch
DesignFidelity
Effort to Create Artifact
Sketch
Balsamiq1
2
3
Designers
All Product People

26. Why
You
Should
Wireframe
n In
case
you
don’t
have
UX
designer
(ohen)
n To
clarify
and
refine
your
thinking:
n Informa7on
Architecture,
layout,
naviga7on
n To
communicate
your
ideas
to
others
n Modern
tools
make
it
easy
and
fast
Copyright
©
2015
Olsen
Solu7ons

27. The
Lean
Product
Process
1. Determine
your
target
customer
2. Iden7fy
underserved
customer
needs
3. Define
your
value
proposi7on
4. Specify
your
MVP
feature
set
5. Create
your
MVP
prototype
6. Test
your
MVP
with
customers
Copyright
©
2015
Olsen
Solu7ons

28. What
Are
You
Going
to
Get
Feedback
&
Learnings
About?
Problem
Space
(your
mental
model)
Solu7on
Space
(what
users
can
react
to)
Customer
Understanding
(needs
&
preferences)
Feature
Set
UI
Design
Messaging
Copyright
©
2015
Olsen
Solu7ons

29. “Ramen”
User
Feedback
for
Startups
n Anyone
can
do
it!
n Ingredients:
n Solu7on-­‐space
product/mockup
to
test
n 1
customer
(with
laptop
if
tes7ng
code)
n 1
desk
n 1
person
to
conduct
the
session
n Pen
and
paper
n Op7onal
note-­‐taker
and
observers
Copyright
©
2013
Olsen
Solu7ons

30. Typical
Format
for
User
Tes7ng
Session
n 5
-­‐
10
min:
Ask
ques7ons
to
understand
user
needs
and
solu7ons
they
currently
use
n 30
-­‐
50
min:
User
feedback
n Show
user
product/mockup
n Non-­‐directed
as
much
as
possible
n When
necessary,
direct
user
to
aTempt
to
perform
a
specific
task
n 5
-­‐
10
min:
Wrap-­‐up
n Answer
any
user
ques7ons
that
came
up
n Point
out/explain
features
you
want
to
highlight
n Ask
them
if
they
would
use
the
product
Copyright
©
2015
Olsen
Solu7ons

31. Dos
&
Don’ts
of
User
Tes7ng
Sessions
n Do
n Explain
to
the
user:
n Their
feedback
will
help
improve
the
product
n Not
to
worry
about
hur7ng
your
feelings
n “Think
Aloud
Protocol”
n Ask
user
to
aTempt
the
task,
then
be
a
fly
on
the
wall
n Ask
non-­‐leading,
open-­‐ended
ques7ons
n Take
notes
and
review
them
aherwards
for
take-­‐aways
n Don’t
n Ask
leading
or
close-­‐ended
ques7ons
n “Help”
the
user
or
explain
the
UI
(e.g.,
“click
over
here”)
n Respond
to
user
frustra7on
or
ques7ons
(un7l
test
is
over)
n Get
defensive
n Blame
the
user
Copyright
©
2015
Olsen
Solu7ons

32. Copyright
©
2015
YourVersion

33. Itera7ng
Your
Product
Vector
Based
on
User
Feedback
in
Solu7on
Space
Problem
Space
(your
mental
model)
Solu7on
Space
(what
users
can
react
to)
Customer
Feedback
Mockups
/
Code
Copyright
©
2015
Olsen
Solu7ons

34. Problem
Space
Solu7on
Space
Copyright
©
2015
Olsen
Solu7ons

35. Copyright
©
2015
Olsen
Solu7ons
Case
Study
on
Product-­‐Market
Fit:
Marke7ngReport.com

36. Product-­‐Market
Fit
Case
Study:
Marke7ngReport.com
n My
consul7ng
client
(CEO)
had
an
idea
for
a
new
product
n Team:
me,
CEO,
head
of
marke7ng,
UI
design
consultant
n Goal:
n Validate
product-­‐market
fit
quickly,
cheaply
without
wri7ng
a
single
line
of
code
n Determine
if
there
was
a
business
opportunity
here
Copyright
©
2015
Olsen
Solu7ons

37. Product-­‐Market
Fit
Case
Study:
Developing
Product
Concept
n Product
Concept
was
“marke7ng
report”
that
let
consumers
control
the
direct
mail
that
they
receive
n Concept
was
fuzzy
with
various
components,
so
I
broke
it
into
2
different
“flavors”:
#1
“Marke7ng
Shield”:
Service
to
reduce/stop
junk
mail
#2
“Marke7ng
Saver”:
Opt
in
&
receive
money-­‐saving
offers
Copyright
©
2015
Olsen
Solu7ons

38. Clustering
Poten7al
User
Benefits
to
Create
Product
Concepts
Reduce
Junk Mail
Find out what
“they” know
about you
Money
Saving
Offers
Compare
Yourself
to Others
Social
Networking
Marketing
Report
Marketing
Score
Marketing
Profile
Save
Trees
“Shield” Concept “Saver” Concept
Copyright
©
2015
Olsen
Solu7ons

39. Copyright
©
2015
Olsen
Solu7ons

40. Copyright
©
2015
Olsen
Solu7ons

41. n Telephone
recruit
of
prospec7ve
customers
n Wrote
phone-­‐screen
ques7onnaire
to
create
rough
target
customer
segmenta7on
n Wanted
users
who
work
full-­‐7me
&
use
internet
n Fit
for
opt-­‐in
offers:
use
coupons,
Costco
membership
n Fit
for
an7-­‐junk
mail:
use
paper
shredder,
block
caller
ID
n Paid
each
person
$75
n Scheduled
3
groups
of
2
or
3
people
to
discuss
each
product
concept
for
90
minutes
n Moderated
each
group
through
the
paper
mockups
to
hear
their
feedback
Product-­‐Market
Fit
Case
Study:
Recrui7ng
People
Copyright
©
2015
Olsen
Solu7ons

42. Product-­‐Market
Fit
Case
Study:
Findings
on
Concepts
&User
Benefits
Reduce
Junk Mail
Find out what
“they” know
about you
Money
Saving
Offers
Compare
Yourself
to Others
Social
Networking
Marketing
Report
Marketing
Score
Marketing
Profile
Save
Trees
Legend
Strong appeal
Some appeal
Low appeal
“Shield” Concept “Saver” Concept
Copyright
©
2015
Olsen
Solu7ons

43. Product-­‐Market
Fit
Case
Study:
Learnings
from
Research
n Learned
that
“Shield”
(an7-­‐junk
mail)
concept
was
stronger
than
“Saver”
n People
didn’t
like
many
of
the
“Saver”
concept
components
n Learned
users’
concerns
/
ques7ons
about
“Shield”
concept
n Refined
“Shield”
concept:
n Removed
irrelevant
components
n Improved
messaging
to
address
user
concerns
/
ques7ons
n Validated
revised
“Shield”
concept
with
quick
2nd
round
of
tests
n No
customer
concerns
n Clear
willingness
to
pay
Copyright
©
2015
Olsen
Solu7ons

44. Copyright
©
2015
Olsen
Solu7ons

45. Product-­‐Market
Fit
Case
Study:
Summary
n 4
weeks
from
1st
mee7ng
to
validated
product
concept
with
zero
coding
n Reasonable
cost
n 1
round
of
itera7on
on
product
concept
n Iden7fied
compelling
concept
that
users
are
willing
to
pay
$10/month
for
n Trimmed
away
non-­‐valuable
pieces
n You
can
achieve
similar
results
Copyright
©
2015
Olsen
Solu7ons

46. The
Lean
Product
Process
1. Determine
your
target
customer
2. Iden7fy
underserved
customer
needs
3. Define
your
value
proposi7on
4. Specify
your
MVP
feature
set
5. Create
your
MVP
prototype
6. Test
your
MVP
with
customers
Iterate:
Ÿ
Hypothesize-­‐Design-­‐Test-­‐Learn
loop
Ÿ
Improve
product-­‐market
fit
Copyright
©
2015
Olsen
Solu7ons

47. Laura
Klein:
April
14
in
Palo
Alto
Author
of
UX
for
Lean
Startups
How
to
use
Qualita&ve
&
Quan&ta&ve
Research

48. Copyright
©
2015
Olsen
Solu7ons
The
Lean
Product
Playbook
n Published
by
Wiley
n Comes
out
May
26th
n Hardback
&
ebook
n Available
for
preorder
on
Amazon:
hTp://7ny.cc/LPP

49. Questions?
@danolsen
olsensolu7ons.com
slideshare.net/dan_o
meetup.com/lean-­‐product
Book:
hTp://7ny.cc/LPP