Who Owns SaaS Customer Development?
“I have seen startups fail because founders were either too prideful or just plain shy (find a +1 to help!) to connect in meaningful ways with customers — potential or actual.”
— Amazon Customer review of Lean Customer Development by Cindy Alvarez
Don’t you love Amazon user reviews? They tell the unvarnished truth (unless, of course, the reviewer you’re reading happens to be the author’s BFF). This one, in particular, nails one truth that every founder interested in Lean methodology and customer development must face: You’ve got to be willing to put yourself out there.
Not in a metaphorical sense. I mean this quite literally.
Yourself. Out. There.
You, the founder, are the key ingredient. Your vision is more important than any other part of your nascent company, which is why you — not an intern, not your product developer, not your assistant, not your head of marketing — have to be the one listening to your customers.
I know. I know. You are so busy. You’re trying to run a company, after all! And I’m here saying you have to be the one on the phone, on the street, or in the Skype session, gathering qualitative data.
What am I, nuts?
Well, if I am, I’m no crazier than Steve Blank and Bob Dorf, co-authors of The Startup Owner’s Manual. According to them, this is precisely how new companies, and established companies creating new products, are growing intelligently and sustainably, while avoiding the pitfalls that have spelled disaster for the thousands of companies that fail each year.
If the definition of customer development is asking your customers for input that helps you develop the solution they’ve been hoping for — who better than the founder to lead the charge? By learning from your customers, on the ground, what they need most, your vision can and will change — for the better.
Why should I conduct customer development interviews when I know what my customer wants already?
In The Startup Owner’s Manual, the authors make a list of “9 Deadly Sins” that qualitative data is uniquely able to absolve, including…
- Assuming “I know What the Customer Wants”
- The “I Know What Features to Build” Flaw
- Emphasis on Execution Instead of Hypotheses, Testing, Learning, and Iteration
Blank and Dorf recommend founders create a set of business model hypotheses for how they envision their businesses working, and physically go out and ask people in their target market for insights:
Of all the lessons of Customer Development, the importance of getting out of the building and into conversations with your customers is the most critical. Only by moving away from the comforts of your conference room to truly engage with and listen to your customers can you learn in depth about their problems, product features they believe will solve those problems, and the process in their company for recommending, approving and purchasing products.
The road to bankruptcy is littered with founders who thought they knew what people wanted2, but never bothered to test their hypotheses. It’s a completely unnecessary risk, especially when avoiding these pitfalls is as simple as finding the answers to three questions:
- Do you really understand the customer’s problem, in its entirety, within their everyday context?
- Is the problem severe enough that people are highly motivated to solve it?
- Will they care enough about the problem to tell their friends?
To find the answers to this list, you’ll need to do a few things:
First, identify your ideal customer — the customer who has a severe pain they’d do anything to solve, and who is willing to pay you real money to solve it. Bonus points if this customer has been so desperate that they’ve hacked together a stop-gap solution on their own already.
Then, ask your ideal customers open-ended questions that lead you to these insights:
- How they describe their problem.
- How severe they consider the problem to be.
- How this problem affects their everyday lives.
- If they could make this problem magically go away, how would it change their lives?
When you collect and use qualitative data correctly to inform their product designs and marketing strategies, you’ll have the information you need to produce a product that people need and want, finding problem/solution fit (and product/market fit too).