Last week, I interviewed with the CMO for a 140-person tech company. They likely have huge growth, a big market opportunity and extremely smart employees. A year ago, I could have only dreamed of accepting any offer from them. But, on that day, I was willing to say no.
Like most interviews, the conversation started with an interrogation of my qualifications. As the interview wore on, though, I took the conversation in another direction. I asked the CMO questions about their customers — principally, how they acquire and retain them and whether they would recommend the product to others. I wanted to evaluate whether the company truly understands the people they serve, and how that translates into their plans for growth and expansion. In past interviews, I neglected to ask these questions, and eventually I found that my perception of product-market-fit didn’t match reality.
Here are the questions I asked and how to evaluate potential responses:
Can you detail a customer story from signup to paid customer? Why did they choose to stay with your company?
Hearing one detailed customer story is typically enough to know if the interviewee knows the business inside and out. You want to know why the customer signed up for the product, what kept the customer active using the product and why it was worth the customer paying for the product. If the interviewer can’t reveal the names of enterprise customers due to privacy terms, then substitute a customer pseudo-name like Pied Piper instead of the real company’s name.
If the company is pre-product-market-fit, they may not have clear answers to these questions. That’s totally fine, but make sure they’re aware of their stage and you both agree on the path to get there.
If there’s anything that seems fishy or the interviewer is skimping on the details, then just ask why and dig deeper on questions. For example, how was the integration process? What did the customer complain about when using the product? If you’re pre-product-market-fit, why aren’t you retaining customers?
What’s your best method for acquiring and retaining new customers?
You want to know where the company acquires new customers. Customer acquisition channels could be Google search results, word-of-mouth recommendations, paid ads or even your personal network. Any company should be able to measure traffic and signups for their web/mobile product through these channels, even if it’s just a landing page.
But all sign-ups are not equal. You can acquire 1,000 new customers through a partnership, but if they all immediately churn, then they’re not valuable to you. So, make sure you learn how effective the company is at retaining customers through these marketing channels. The key term here is typically customer lifetime value — the total value of a customer through the lifetime use of the product.
Generally, you’re looking for clear evidence in the form of data or customer stories that your interviewer knows the channels through which the company acquires new customers and how effective they are at retaining them. Each company will have unique metrics that are most important to their business’s success depending on their stage. You’ll get different responses for a mobile app business compared to a consumer-focused business compared to a SaaS business. Ask an industry expert or trusted friend afterwards if the numbers or estimates you hear are reasonable for the company.
Do you notice a lot of word-of-mouth recommendations from customers? Can you show me any examples?
I firmly believe the best way for any consumer or small-to-medium B2B business to organically grow is through word-of-mouth recommendations. Their acquisition cost is low yet their conversion to signup is fairly high. You can probably recall numerous times you tried a new product because of a friend’s recommendation.
You may get a generic response from the interviewer because this is a difficult question to quantify — a lot of offline recommendations can’t be measured. But, that’s OK!
Before the interview, talk to at least one or two of their customers. Ask the customers why they signed up for the product, how they use it and whether or not they would recommend it to others. If they sing its praises, it’s a strong sign that this company is going to stick around. If customers perceive the company in a radically different way than the interviewer, it’s a really bad sign.
When I asked these questions to my interviewer last week, I was shocked by his responses. He couldn’t share a single customer story. He said “I envision” twice — yet had no evidence to support his vision. I shared the results of my 12 customer interviews, yet he completely ignored the clear gap between how he wanted the product to be perceived and how it was actually perceived by its customers.
You can avoid working at the wrong company. Just ask the right questions and think critically about their responses— it’s your job to interview them just as much as it’s their job to interview you.
Good luck finding your next dream job! Feel free to email me with any follow-up questions at firstname.lastname@example.org.