Lean Validation and Experimentation
Introducing Lean into your company is one of the best things you can do. It comes together with Agile and Scrum methods of development. This will give your company a real boost to get the new product development back on its track fast. Bad ideas will be divested early, good ideas will move much quicker towards prototypes and MVPs.
No idea is bad or good though. Each idea has its own merits. Usually those which move on into the Lean track are those which are more likely to generate revenue. But how do you determine which ideas are good enough? And what is good enough?
These are things you determine in the experimentation and validation stages of Lean.
The precondition for Lean experimentation and validation is that you have a good sense of your value proposition.
So how do you experiment and validate?
Lean validation:
The questions you should ask before you start validating your experiment are the following (A Lean Approach to Product Validation):
1. Validate the problem. Is this a problem worth solving? If users don’t think this is a major problem, your solution won’t be appealing.
2. Validate the market. Some users might agree that this is a problem worth solving. But are there enough of them to make up a market for your product?
3. Validate the product / solution. The problem might exist, but does your product actually solve it?
4. Validate willingness to pay. There might be market demand and a great product. But will people actually be willing to reach into their wallets and pay for it?
Lean Experiments
In order to be able to answer these validation questions you have to carry out experiments. The experiments possible are seemingly endless:
1. Competitor analysis. Are there any products out there which already provide a solution to the customer’s problem? What would the benefits be of your solution as opposed to the competitors?
2. Customer survey or Customer interviews
a. Do they experience the problem?
b. How painful this problem for them? (i.e. is it a tier 1 problem?)
c. How do they solve the problem now?
d. Would they pay for a solution to the problem?
3. A/B / Split / Bucket testing: comparing two versions of a solution whether it be a website, tool or app against each other to determine which one performs better.
4. Preselling:
a. Create video “drop box like”
b. Fake sales page on social media like Facebook to find out if the customer is willing to pay. This should include a call to action with link to data/numbers for instance in Google Analytics.
c. Get payment before product is ready by giving the customers a VIP price with the clears stated message Help us to make the product awesome
d. Mocked up brochure which describes the core user journey and the value proposition
5. Crowdfunding: running a successful campaign means people are willing to buy your product.
6. Landing pages where you explain the value proposition in a visual way
7. Quick MVP, with basic feature set which describes the value proposition and make sure to connect to data to see where customer traffic comes from MVPs.
Once you have built one or more of these experiments you have to do a sanity check with the customer. The goal of these experiments is to get a good sense of the why behind the customer’s question and if your solution solves the actual problem.
Basically, you are validating the four questions of Lean validation:
“Unfortunately, entrepreneurs and intrapreneurs often mistake prototypes and MVPs as limited versions of the future product(s) or service(s) they want to build… In other words, the goal is not to start building a limited version of your product or service. The goal is to achieve maximum learning for the least amount of effort.”
Take note that you don’t just go to one customer. Usually a larger, more diverse customer group will give you a much more precise insight. It will also be good to connect the experiments to data analytic tools.
It’s a combination of a live visit and data which will greatly contribute to your learning cycle.
And exactly that will allow you to pivot!
