1. Validate the theories
- Now that we have an idea, we need to make sure it's the right thing to do. Every idea has an opportunity cost. Working on product A means you're not building product B.
- The hallmark of an effective product manager is being able to sort out the great ideas from the merely good ones.The ideal experiment to validate our hypothesis would be to build the full product and see how our success metrics change.
- Often, building the full product is a big investment in both time and cost. This means it's very risky to always build the full product to see if it achieves its goals. Instead, companies have started adopting the lean principles that we previously discussed to find less expensive ways to validate an idea before building the product.
- These validation approaches take many forms. Some ideas need only internal validation by looking at existing data and analytics and having discussions with existing customers and stakeholders, of doing cost/benefit analysis, or other A/B tests.
- Other ideas, especially for more innovative and new ideas, you would be well-served in actually talking with customers. This gives you extra insights beyond what you would see from trying to do simply interviews or very small focus groups. This approach, called customer development, will help you understand the customers' pain points and well as their goals through a more thorough approach of validating your idea and addressing their needs.
- With customer discovery, you might even discover that a different idea that many customers complain about is worth pursuing instead of, or as a reimagining of, your original hypothesis.
- Keep in mind that the goal right now is to figure out whether to build a given product, not to conduct user testing to see if we've built a particular thing well. The former happens at the beginning of the product process and the latter will happen once we've started building something.
What is customer development?
- It's a way to validate if the people you think are your customers truly are the right customers and confirm you're on the right path.
- This includes finding out what problems customers are seeking to solve. What they're doing right now that either creates those problems or tries to solve them. What they're able to do, technically, financially, or socially, that had they found out about, and decide if a new product feature is worth it.
- Fundamentally, it's a conversion and an exchange of information. And it's an iterative process. You may begin doing the customer discovery phase and move through problem-solution fit, develop a proposed minimum viable product, and proposed funnels.
- And then carry that to the second element of customer validation of trying to evidence product-market fit, figure out your business model, as well as your sales and marketing roadmap.
- And you may find that there is revisioning that needs to take place. And that is relatively common. Then you go back to step one of customer discovery, test those revisions, go back to validation, and test these three elements as well.
- And you continue that until you're ready to advance to the point that you have defined exactly what you believe is the right product for that market. Then you can move onto step three and consider elements of scale, execution.And then lastly the company building, of how do you build a company based on that if you're a start up?
- Or how do you expand and evolve what you're doing as an existing company to scale the organization and to scale the operations to successfully bring that product to market and support it therein?
- People new to product management typically don't have extensive training and experience in doing customer interviews. But interviewing is an incredibly valuable skill because it's an effective and low-cost way to validate your opportunity hypothesis.
- And since a product manager's ultimate goal is to help the customer be awesome by using their product, spending time with your customers is critical to this role. One tool to help build and evolve your skills in interviewing is this mindset of the customer journey, of what is their current state, their motivations, and their obstacles?
- When planning for your customer interviews, think first about getting insights on their current state. What's their current view of the problem that you believe your product will help solve? What's the impact of this problem? How frequently do they experience it?
- And what current steps do they take to try to remedy that problem? Secondly, we'd like to get insights on their motivation. Are they satisfied with existing solutions, existing competitive products that bring them some resolution to the problem?
- Do they like your solution? Why? Do they believe that it will work?And are they able and willing to use it? Lastly, we'd like to get insights on the obstacles that are real or perceived. What do they like about existing solutions? Are there any challenges to switching from existing solutions to your solution?
