In a previous post I lamented the excuses many of us use, so that they avoid doing customer development (Common Excuses to Avoid Customer Development). In one of the comments David Telleen Lawton suggested that they may not realise what are the benefits of sticking with this process.
Why would someone dedicate thousands of painful hours to locate his/her customers? Why would s/he go through the pain of talking to them or even offering them his/her products?
I thought that the answers were obvious but I would like to reiterate them here. If I forgot any, please, fill up the gaps. The following list will be in particular order, although one benefit may be the consequence of the previous one.
1. First and foremost: without customers, there is no business. Every business is firmly based on its customers. If there is none out there to buy your product, then you have no business at hand.
You probably think that your business idea is the best that ever existed! Or you may think that your product is of the highest quality! So what? If nobody wants to buy it, if you have no customers, your business will go bankrupt before you even start.
Customer development identifies, if there is demand for your products or services, before these are created.
2. The most precious things an entrepreneur has is money and time. Both of these, most of the times, are scarce; so, they need to be safeguarded at all cost.
Can you imagine what will be the consequences, if you run out of one or the other? That’s right! Your business will fail.
If customer development is conducted correctly, you will be able to assess the potential of your business idea, before you invest heavily in it. If it becomes obvious fairly quickly that customers want a different product from the one you have in mind, you will still have the resources to create it for them.
3. Let us now assume that your product is indeed a hit!
Customer development will help you identify the features of your demo or minimum viable product that will attract the interest of a wider audience. This way, you will focus on the features that are popular, instead of the ones that are not.
The repeated customer interviews will give you ample feedback and a clear direction. Once the public validated your choices, the rate of success becomes higher.
4. Another important outcome that comes from focusing on customer development is the identification of the market segment that would be most interested in your product.
Let’s face it! Other, larger companies have already dominated the same market for the last years or even decades. Why would the customers prefer your unbranded, unknown product?
So, you don’t stand a chance unless you find a solution that solves the specific problem of a specific niche. Customer development weeds out the people who are only vaguely interested in what you are offering. At the same time, it turns the spotlight on those EarlyVangelist who will spread your business like fire.
5. In the case that your product or service is highly innovative. In the case that your intended market does not yet exist, do not despair! Customer development is probably the only way to create a new market out of nowhere!
You do not have to rely exclusively on goddess Luck. After all, Luck can be flimsy and unpredictable. On the other hand, in-depth interviews with potential clients will bring tangible results. In a relatively short period of time, you will find out the levels of interest and the general intention to buy or not to buy.
6. Customer development is not a purely qualitative process and should not be restricted in the first phases of building a business. Once you identify your market segment, once you have attracted thousands (or even millions) of customers, you will need to change continuously your products and services to grow your customer base.
Also in this case, customer development will play a crucial role in taking the right decision on which aspect of the business (or product) you should pay more attention. However, at this stage customer interviews will be complemented with detailed analytics.
7. One further parting thought… Customer development may not be customer service but it can bring similar benefits. After all, you get to know your clients intimately (within limits of course) and this helps you to serve them better by creating the product they really need.
On the whole, customer development may not be easy but it remains essential in building a successful business and sometimes even your life (Read my post on 3 Lean Principles to Live By). Let me know, how the process helped you and if you know of any other benefits it conveys.
For more information on lean startup methodology, you could take a look at my other blog posts.
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