The nuts and bolts of building a customer driven company
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The nuts and bolts of building a customer driven company

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A talk from 500 Startups I gave on how to build a customer driven company and do customer development interviews ...

A talk from 500 Startups I gave on how to build a customer driven company and do customer development interviews

I'm writing a book on How to Build Customer Driven Products based on tactics like the ones in this presentation. You can sign up to learn more here: http://eepurl.com/RZoO9

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  • Customer Discovery OverviewCustomer Development Interview ProcessOverview, examples, pitfallsCore Backupify Product Customer Development RecommendationsQuestion brainstorming, recommendationsCustomer Validation OverviewAnalysis and Q&A on Current Backupify practices
  • We have a feedback box on every page on the site. We get 50+ emails every week filled with passionate, frustrated, excited, confused users. The perfect group to experiment with.I'll go back to old ones to reach out about experiments or if they're asking about stuff we're currently thinking about I'll send it right away...they may be just the early adopter we want for such a feature.
  • 1) People - Aka - Who Are You?Before you get into anything about problems or your solution, you need to figure out who you're actually talking to. This both warms up your interviewee with some softball questions and gives you an opportunity to build some rapport with them. Some example questions you could ask:What is your name and role at your company?How do you fit into your company's department structure? Overall in the company?What is your budget like? Who has to approve your purchases?How do you discover new products for work? Do you need any approval to try them?Have you tried anything new recently? What is a typical day like on your job?How much time do you spend doing [task X]? (Task X being anything they mentioned in their typical day that stood out)Do not shortchange this opening section of questions! You don't need a novel on their daily life, but you *do need* enough to be able to understand their role within their company, who key players are and a general baseline of their sophistication. All of this will help you later pattern match who the user type that is most receptive to the problem you're solving and the solution you offer. -> The More prep you do to reseach the person, the more efficient and deeper you can probe on this; you’ll be pattern matching later.Goal: Get a baseline background of the person you’re talking to. Be broad.
  • 1) People - Aka - Who Are You?Before you get into anything about problems or your solution, you need to figure out who you're actually talking to. This both warms up your interviewee with some softball questions and gives you an opportunity to build some rapport with them. Some example questions you could ask:What is your name and role at your company?How do you fit into your company's department structure? Overall in the company?What is your budget like? Who has to approve your purchases?How do you discover new products for work? Do you need any approval to try them?Have you tried anything new recently? What is a typical day like on your job?How much time do you spend doing [task X]? (Task X being anything they mentioned in their typical day that stood out)Do not shortchange this opening section of questions! You don't need a novel on their daily life, but you *do need* enough to be able to understand their role within their company, who key players are and a general baseline of their sophistication. All of this will help you later pattern match who the user type that is most receptive to the problem you're solving and the solution you offer. -> The More prep you do to reseach the person, the more efficient and deeper you can probe on this; you’ll be pattern matching later.Goal: Get a baseline background of the person you’re talking to. Be broad.
  • 2) Problems - Aka - What are your greatest pains?This section is where you try to find out whether the person has the problem you believe you're solving.  Your goal is to not lead them to your problem. The less you lead them while still hearing your problem being mentioned the more validation you have! Some sample questions you could ask:What are your top 3 challenges you face in your job? What are your top 3 challenges you face in your job related to [industry X]? (Industry X being the one your startup is in)If you could wave a magic wand and instantly have a solution to any of those problems...what would the solution be?Dig deeper into their typical day on anything that sounds painful or expensive. (You can add some hyperbole here to get them to rant a bit by saying things like "that sounds inefficient..." or "that sounds expensive...")How have you dealt with or solved [Problem X]? (You're looking to find out if they've hacked a solution together themselves. If they have...ask for a copy of it!) People love to talk about themselves, so let them go nuts here and really rant about their problems (i.e.- Shut up and listen!).  Generally, people are terrible at proposing solutions, but you want to hear generally what they envision as solutions or see what they've cobbled together themselves.  Notice, you haven't mentioned your solution or problem yet. If they don't mention your problem specifically, then as you finish this section of questioning, you should directly ask them if what you think is a problem is a problem for them. Whether they agree it's a problem or not, you want to then probe why it wasn't one of their top problems. 
  • 3) Your Solution - Aka - See if your idea survives customer interactionIf in your discussions in part 2 your problem you think you're solving comes up naturally from your interviewee you're on the right track! Bonus points if the way they describe solving it with their "magic wand" remotely resembles what you're doing. No matter what happens in part 2 you should discuss with them what you thought the problem was and what your solution is. Getting validation that they wouldn't be interested in the idea is just as helpful as finding out they love it; either they're not a customer or you are learning what your customers want instead of it. Some sample questions you could ask:Walk them through the problems you believe your solution solves. Do they agree?Does [your solution] solve any of their problems?Would you be willing to pay for our solution? How much? (Don't be afraid to probe for the pricing you know you want..."Would [X] be reasonable?")If they're willing to pay your price and like the idea then..."Would you be willing to start right away?"If all goes well and you really are solving a pain, then your customer should want access to the product right away. More likely, you're going to learn a ton about what they do and do not want and your idea will begin evolving.This basic structure can carry you a long way towards some great validated learning about your idea and the market's desire for it. 
  • 1) Take Good Notes or Record Everything!- Once you've interviewed 8-10 people, you should be going back over all of your notes and look for patterns. This includes especially looking for patterns in the Part 1 section to see what all the people that agree you are solving their problem have in common. You should summarize your notes then and share with your team.2) Have other team members sit in on some interviews- A good customer development focused company will have everyone involved in the process. Performable, pre-HubSpot acquisition, had their engineers spending 30% of their time on the phone with customers. Nothing helps someone do their job better like understanding who they're building/selling/marketing for.3) Be conversational- It shouldn't feel like an interview! They should feel like they're just having a conversation with a friend about their problems at work. The more comfortable they feel with you, the more they will open up.4) Go off script- The best stuff comes when you dig a little deeper on something that strikes a chord in the discussion.  The script is there to be your roadmap, but there's no reason you can't return to it after a 5 minute digression about a specific pain or discovery about how the company operates. 5) If they've made an MVP...ask to see it!- Nothing gives you more insight to a customer than what they've hacked together themselves to solve a problem. The best thing you can do is ask to see it, which will give you an idea of what they're hoping a solution will provide. These people are also the strongest candidates to be great, helpful early adopters of your product.6) Always follow up- It's just common courtesy to thank people for their time and help, but it also opens the door to follow up with them in the future if your product changes and is a fit for them or to invite them to your beta.7) End with an ask- Always end your interviews by thanking them and asking them for something. It may be to get a copy of their MVP or even better, ask for an intro to someone they know that might be interested in what you're working on. In my experience, these intros have an 80-90% success rate in becoming new customer development interviews, whereas cold emails only have a 10% success rate. 8) Be open to new problems! That's how great products are born.- As Steve Blank has said, "No idea survives first interaction with a customer." Don't be afraid to shift your focus from your first idea to what you're actually hearing customers want.  If you probe in part 2 and find a burning problem...find out how they currently solve it and what they'd pay to solve it.  ---
  • You have to think like your customer. Where are they already? What groups do they join? What events or locations do they go to?Also ask yourself: What might they tweet about related to your product/problem? Where else might they talk about it?Finally, don’t forget your own network; everyone has cousins, uncles, and old classmates in other industries. Use your social graph to get introductions.
  • Landing pages, existing customers, blog visitors, twitter followers, contacts from coworkers. All of them are instant, awesome sources for people to talk to. Yes, you need to be concerned about bias because they already know who you are, but they’re also a great source to test new ideas to ensure your existing base is interested.Your goal should be a balance between who knows your company and who you find randomly.
  • Interview in groups of 8-10 people per customer type.Summarize notes and review with others.Look for common patterns matching C-P-S.This is why you ask so many questions before you get to your solutionCompare to your high level metrics to see if anecdotes match data.
  • If you’ve read through all of this it probably sounds pretty easy and straightforward. Yes, none of this is hard from a brain power sense. What is hard is having the discipline and putting in the effort to stick to this.Lean Startups are harder than blind startups that go just on gut feel and winging it. Lean Startups just have a better chance of success.

The nuts and bolts of building a customer driven company The nuts and bolts of building a customer driven company Presentation Transcript

  • The Nuts & Bolts of Building a Customer Driven Company Jason @Evanish November 6, 2013 500 Startups Mountain View, CA
  • Who is Jason @Evanish? 100’s of customer development interviews with: Cofounded: Blog my learnings at: JasonEvanish.com
  • Today’s Topics Why be Customer Driven How to be Customer Driven The Customer Development Interview Process By @Evanish
  • …be a Customer Driven Company? By @Evanish
  • Learn the language of your customers. By @Evanish
  • Build and improve the features that matter. By @Evanish
  • Understand the why behind your analytics. By @Evanish
  • Learn what jobs your customers hire you for. By @Evanish
  • Discover who and what to say “No” to. By @Evanish
  • How do you make your company Customer Driven? By @Evanish
  • Get feedback from your users. Learn more at http://bit.ly/FeedbackBoxes By @Evanish
  • Learn from your support tickets.
  • Ask sales what excites leads. By @Evanish
  • Use your analytics. By @Evanish
  • Get out and talk to them. By @Evanish
  • The Customer Development Interview Learn in detail at: bit.ly/CustDevInterview By @Evanish
  • The Structure 3. Solution The MVP House 2. Problem 1. Person By @Evanish
  • The Structure – 1. Person Learn about them and their role in your industry. • Who are they? What’s their role? • How is your budget handled? • How do you find new products for work? • How much time do you spend on [Task X]? Goal: Get a baseline background of the person you’re talking to. Be broad. By @Evanish
  • The Structure – 2. Problems Learn about the problems they recognize first. • NOT about the problems you think they have. • What are your top 3 challenges you face in your job related to [industry X]? • If you could wave a magic wand…what would the solution be? Goal: Get them to say the problem you want to solve is a problem they have (prefer unprompted) By @Evanish
  • The Structure – 3. Solution Now you tell them about your product concept. • “That’s interesting” = Kiss of Death. • If they’re not anxious to use right away, they’re not a key target. • Read body language, voice inflection and energy level for signals of interest. • Best reaction is actually following through after the meeting or calls. Goal: Discover if they’re interested in your solution and gather feedback. By @Evanish
  • Tips for making the most of Interviews 1. 2. 3. 4. 5. 6. 7. Take good notes. Involve other team members. Be Conversational. Go off script. Ask to see any MVPs they’ve made/use. If they’re excited about something, ask if they’ll pay for it. Show them mockups or early concepts if you have them and pay attention to their reactions/feedback. 8. Always Follow up. 9. End with an ask. 10. Be open to new problems and opportunities! 11. Summarize and review your notes with your team. By @Evanish
  • Where do you find people to interview? Find 95 methods at: bit.ly/1stcustomers By @Evanish
  • The Best Place to Find Candidates: By @Evanish
  • Now what? • Interview in groups of 8-10 people per customer type. • Summarize notes and review with others. • Compare to your high level metrics to see if anecdotes match data. • Keep talking to customers during product dev cycle. By @Evanish
  • Customer Development in a Nutshell Common Sense + Diligent Process + Thought = By @Evanish
  • Questions?
  • Contact me…I’m happy to help. On Twitter: @Evanish Other sites: About.me/Evanish Email: Evanish.J@Gmail.com Find all my Lean learnings at JasonEvanish.com/lean-startups/ Find a detailed, blog form of the interview process at bit.ly/CustDevInterview And 95 tips for finding your first customers at bit.ly/1stcustomers