Customer Discovery Tips to Save Time & Money
If you’re starting an early-stage startup and you haven’t heard this nugget of truth yet, you will soon: “You’ve got to get out of the building.”
This doesn’t mean go for a walk to clear your mind and get the blood flowing. It means you have to get out of your cozy little bubble and do some customer discovery.
The Dos and Don’ts of Customer Discovery
- Don’t try to get a couple hundred customers in your first few months. Instead, find a small handful of customers and get a deep understanding of their problems.
- Don’t convince yourself that every inconvenience they run into is a problem they would pay to solve. Instead, listen for their recurring, high-value pains.
- Don’t parachute into the communities you’re going to serve and start asking people to sign up for your thing. Instead, offer ten pieces of free value (free guides, lists of resources, short conversations) for every one request you make. Commiting to a 10:1 ratio is a good benchmark.
- Don’t let on that you’ve invested a lot of time and energy into fleshing out your idea, even if you have. Instead, keep the stakes low so that the person you’re talking to feels free to criticize or invalidate your assumptions.
What is Customer Discovery?
Steve Blank uses the term customer discovery in his book, "The Startup Owner’s Manual" to describe the process of finding customers and learning everything you can about their pains and needs in the early stages of product development.
If you’re not familiar with his work, I’d recommend starting with the talk below, and if it resonates, buy the book. It’s packed with practical advice and reads and feels like a manual as opposed to a conventional business book.
The idea is that you’ve made a handful of assumptions about why your thing needs to exist.
But, before you go too far down the road in building out your idea, shop your assumptions around to a handful of your potential customers and learn just how right or wrong you might be.
Let’s dig into those dos and don’ts I listed above to help you keep a few things in mind as you’re doing your customer discovery work.
1. Start Small
Don’t try to get a couple hundred customers in your first few months. Instead, find a small handful of customers and get a deep understanding of their problems.
It’s going to take a long time to grow your business. Embrace this by starting small and expecting to stay small in the early days.
Gail Goodman calls this the "Long, Slow, SaaS Ramp of Death." Is that a less-than-heartening message?
Is it more realistic than the "Raise a metric jackton of money, work 80-hour weeks for a few years, and then join the three comma club when you sell to Google" bullshit that unicorn hunters want you to buy into?
Chances are good that you’re going to be small for much longer than you’d like. Use that to your advantage rather than raging against it by treating your earliest adopters like the golden peeps they are.
You’re an underground band that nobody cares about. They’re the hipsters who heard about you first.
Figure out what makes them tick and do things for them that don’t scale. If you can design your product to make their wildest dreams come true, selling to people just like them down the road will be easier.
2. Listen for Pain
Don’t convince yourself that every inconvenience your audience runs into is a problem they would pay to solve. Instead, listen for their recurring, high-value pains.
The reason that it’s better to do this sort of customer discovery before investing too much of your time and money into a solution is that you have to remain as objective as possible.
Try as you might, if you’ve already started designing a solution, you’ll be susceptible to ownership bias.
I’ve seen this happen a hundred times: Founder already has a solution in mind or in the works, and every minor inconvenience the customer shares is a slam-dunk validation of their feature set and roadmap.
To stay as open and flexible as possible, delay investment for as long as you can and find real pains instead of inconveniences. I’ve written more about this specific tip here: Is Your Early-stage Startup a Vitamin or a Painkiller?
3. Give First
You need to be a part of the same communities as your target customers if you’re going to serve them well and build something they want. And yes, let’s be honest, you want to convert them into paying customers down the road.
But first, you need to become a valued personality who has earned a tremendous amount of trust within a community in order to (eventually) attract customers to your business.
If we invert the problem and think about the things a person would do in order to be ignored, it’s easy to imagine ways to behave exactly the opposite and build trust.
What’s the best way to guarantee that you get ignored or shunned? Simple. Be a self-oriented, self-serving taker who is constantly asking for favors, spamming the channel with their own updates, and bragging about recent successes.
The opposite of that person is others-oriented, sharing free resources related to their area of expertise, and helping people in the group who are struggling to make progress.
ironic poetic that the "Give First" approach ends up being better for your Self. Keep it in mind and always find a way to teach and give things away to attract trust and attention.
4. Keep the Stakes Low
You’ve got to make people feel comfortable with declaring your idea a dud. If the truth is that they’d never even consider pulling into their existing workflow, they need to be able to say that.
If you tell them how excited you are about this concept and how certain you are that it’s going to make their life better and you can’t wait to show it to them, they’re more likely to protect your feelings and lie to your face.
It doesn’t matter if I created the work they’re looking at, or if we’re launching next week. I always tell interview participants:
“This is very low stakes because we’re still early on in this process.”
“We’re not at all invested in what we’re sharing today. But we are invested in getting it right so it’s no big deal to us to blow this whole thing up.”
“Feel free to be blunt, this isn’t my baby. I haven’t spent too much time fleshing this out yet. We’re trying to poke some holes in this to see if it’s worth investing in.”
You can read more of my thoughts on keeping the stakes low here: Pretend the Stakes Are Low … Even If They Aren’t.