The importance of customer research

If you’re starting a company, chances are you’re selling either a product or a service to a group of customers. Oftentimes, companies and or Founders are so fixated on building a product that they believe will resonate with a market or audience but often do very little, if any testing with their market. This is where I’ve noticed a major rift between the companies that achieve long-term success and the ones that don’t.

Initial Discovery and Validation

The discovery phase is the first phase of the GTM process. In this phase, a founder, product manager, or CEO may have a great product idea. The idea could have come from anywhere — inspired from deep market expertise, the combined thoughts of a group of people who work together, or even from a person with a multidisciplinary mindset who comes from outside the industry.

I can’t begin to tell you how many times I’ve heard the phrase, “I had this idea before [insert CEO] came up with it.” It’s one thing to have a great idea, and it’s an entirely different thing to have the commitment, time, and expertise to actually develop it. Ideas are nothing more than ephemeral and can disappear as easily as they are created. If you have a great idea, but don’t want to do the heavy lifting to understand your market or customer, then you’re probably not ready to launch a successful product or business.

Before you continue reading, have an honest conversation with yourself. Why do you want to launch this product? What is it about the product or company that excites you? On a scale of 1–10, how passionate and excited are you about solving this problem? Why do you want to work on this problem? How much time and capital can you dedicate to this endeavor? What would you give up?

If you are ready to roll up your sleeves, become an entrepreneur, and take your idea to market, then you can start with the market discovery process. If your excitement is lackluster and you’re in it only for profit, I believe that the road ahead will be difficult in the long run. Your mission has to be focused on your customers and the pain point you’re solving for them. In my years of speaking with customers, they generally sense when a company is more interested in genuinely helping them solve a problem versus making a profit.

The discovery process is one of the most critical phases in the journey toward launching a software product or service. Many companies fail to do a proper discovery and analysis of the market and their potential customers before moving forward and building a product. If you skip this phase, you’ll likely waste a lot of time and capital trying to fix issues that could easily have been circumvented had you done the proper due diligence.

“For the love of God, talk to your customer” — Patrick Campbell,
Price Intelligently

The very first step is to test your product hypothesis with a target audience. The goal here is to confirm that people are in fact interested in your new product or service. The easiest and most cost-effective way to do this is to administer a short survey to gauge the market interest for your idea.

You can use a variety of tools like SurveyMonkey and Google Forms to gather feedback from your respective audience and validate your concept. You can also reach out to companies who can qualify and pre-screen prospective customers for Q&A and focus group discussions.

Administering a survey is the easiest way to get insight from your potential customer without spending a lot of money. I’ve sent surveys to my social networks, and I’ve even asked colleagues to forward surveys to their friends and networks. Most of the time people gladly participate, but if you’d like to incentivize them, a gift card goes a long way.

I would limit surveys to no longer than 10 questions, which should give you a good pulse on customer sentiment around your product. Make sure to ask if they would purchase your potential product and for how much, as this is a good indicator that allows you to understand their interest in purchasing your product — and it’s a key question that many founders fail to ask early on. Also, try to qualify their responses. For example, ask them to rate their interest level on a scale. A mix of qualitative and quantitative feedback has been most helpful whenever I’ve led these types of customer feedback inquiries.

A note on the topic of customer interviews: There is a distinction between building a new product within an existing market versus building a new product within a new market. If you’re building a product in a brand new market, prepare to invest much more time on top-of-funnel activities like educating customers about the new market, which requires additional capital and headcount.

Some founders argue that customer feedback in brand-new markets is not as necessary. Henry Ford is famous for saying that if he had asked people what they wanted, they would have said faster horses. That being said, I still firmly believe it’s important to gather feedback from your customer — whether you’re building a product in a new or existing market. You can start with a novel idea, but it still has to resonate with customers.

At this point in the discovery phase, a product marketer should have an assumption of the target audience and potential segments. The PMM should run interview studies for each customer segment with 5–7 customers per segment. I generally conduct 60–90 minute interviews per customer, so I can really understand their perspective and get some feedback on the pain point that we believe we’re trying to alleviate.

Not All Customer Research Is Created Equal

I get a lot of pushback from companies when I ask to administer these types of interviews because they do require time and investment. Leadership often resists this step because an internal team has already conducted some sort of customer research. But not all customer research is created equal. In-depth customer conversations differ from what other teams focus on.

These customer research questions are open-ended and the exclusive purpose is to understand the customer’s sentiments — not just from a usability or product perspective, but from a cross-functional, holistic business perspective.

Companies can save months, if not years, of wasted time and effort if they focus on this practice — trying to deeply understand all aspects of the customer journey and frame of mind as they are navigating their own personal and professional life — for a few weeks or months.

Another word of caution: Companies who run interviews with customers often push their product or ideas on them during the conversation. The worst thing to do is to assign the responsibility of the customer research initiative to someone in business development or sales. They are trained to sell and influence, and they often do more talking than listening.

This customer feedback session is a different way of communicating with the market. Think of it like a therapy session: one party, the customer, is talking for about 90% of the time and the other party, the interviewer, is asking questions for 10% of the time.

In these early stages when you’re validating your product thesis, these conversations should not be about your product or company. This conversation is about the customer: their needs, their desires, their wants, their pain points, and their journey. This is a crucial missing piece that I find deeply technical teams or founders often miss.

Further, if you are too attached to the product as a product owner or CEO, you might miss the nonverbal cues and signals that your customers are sending during these interviews. I would highly encourage all companies and teams to invest in hiring a neutral function, like a product marketer or commercialization manager, to run these sessions.

Lastly, one key misstep is not collecting and aggregating that feedback into key trends and themes, and customer segments. By collecting these answers into overarching trends, you’ll have strategic insight into your market and industry. And that insight should be shared broadly in the company to ensure alignment across the entire business.

When you’re conducting these interviews, pay attention and ask yourself the following questions: What keeps coming up in these conversations? Where does the conversation keep going? In the Customer Research section, I include some examples of questions I’ve used in B2C / B2B customer interviews and deep dives. The “Jobs to be Done” theory is also a great interview framework I’ve used in the past. Regardless of your technique, I highly recommend you spend a significant amount of time learning about your customer and market. And don’t just stop here — take every opportunity you can to collect feedback on an ongoing, iterative basis.

One final benefit of in-depth interviews: those people who participate in the discovery phase and confirm your early product hypothesis are often the best people to include in a beta launch. A beta launch is essentially a pre-launch or early access launch for a select group of customers. Beta launches are great for businesses to gather feedback from their target market without risking any major backlash from customers if product features aren’t what customers expect.

I’d love to hear from you. If you enjoyed this article, let’s stay in touch.

My latest book, The Launch: A Product Marketer’s Guide, is now available on Amazon. I also wrote the book “Product Marketing Debunked. The Essential Go-To-Market Guide” which you can purchase on Amazon.

If you’d like more in-depth tools on how to take your product to market, you can check out my Go-To-Market workshop where I share my 10+ years of knowledge about how to launch your product.

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