Why Your Customers Are So Important To Your Business’s Success

September 26, 2016 No Comments

Featured blog by Todd Olson, CEO, Pendo

We love heroes. Independent of discipline and genre, we as a society tend to prop up and revere those among us we see as visionaries and heroes. I suppose deep-down many of us wish to be a hero and it gives us all a high bar to hit – something to strive for. This is no different than product development. Think about Steve Jobs and Jeff Bezos. These leaders are revered, sometimes to the point of worship, for their excellence in knowing what customers want and just building it. It’s as if they know more about what we want than we do. Hence, being just like them becomes the goal for a lot of product people.

Sadly, this is not a replicable model for success, nor is it an accurate reflection of what it takes to achieve it. I suppose it’s possible we could all just be granted with some prescient knowledge leading to successful products, but it’s hardly something predictable. Learning, not guessing or assuming, is a far better way to build a successful product, and it has a far better chance of building repeatable successes. Heroes, when you dig into their past, generally have done something to prepare for their success. Meticulous research, training, and observation prepares you for the moment.

During an interview, Steve Blank, author of 4 Steps to the Epiphany, was asked about Steve Jobs, and he remarked that he saw him several times in the Palo Alto Apple Store. Steve was watching consumer behavior, surveying the market, and collecting data on his products and customers. In short, it wasn’t some magical intuitive idea. His vision was informed by data and experience. He wasn’t really guessing nor was he prescient — he was methodically capturing data, testing, and learning his way towards success.

For me, there are 3 key steps to going from guessing to learning: 1) shift from asking people what they want to understanding their needs, 2) iterate towards a final solution and 3) focus on real adoption as a proxy for success.

1) We as humans don’t know what we want.  Jakob Nielsen says that “critical failing of user interviews is that you’re asking people to either remember past use or speculate on future use of a system.” Instead of asking what users want, you want to start with problem exploration.  Design thinking is one of several processes teams can use to shift interviews from asking people what they want to understanding what they need. The key to Design Thinking is starting with empathy.

Students at Stanford’s d.school were tasked with creating a low-cost incubator for premature newborns in remote villages in Africa.  However, when they started to gain more empathy with the mothers and the emotional aspects of the problem, they ended up designing something completely different from a traditional boxy incubator. Mothers were reluctant to use traditional incubators because they lacked the flexibility to travel from their villages and/or remain at the hospitals while their infants recovered. The solution?– a portable incubator sleeping bag. It solved the physical travel issues, the need to keep premature infants warm, and the emotional need for mothers to remain close to their children.

2) Build the least amount possible and iterate. Lean startup introduced the term “Minimum Viable Product” – the smallest thing necessary to build – to capture validated learning.  All too often I see teams fail to really build the simplest thing necessary.  Learning requires a lot less product than most people think.  Buffer started simply as a landing page that was used to gauge interest.  By launching the landing page and measuring responsiveness, they were able to validate interest before building an actual product. A powerful question I like to ask my teams is “do we really need this feature to learn more”  or “what’s the absolutely least amount of work we can do to learn.” Iterating on the basics is more efficient and keeps it simple.

3) Usage and adoption are pillars of product success. The last key to real success is understanding what success really means. Some people confuse success with having a customer buy, and while having a customer buy is certainly validation – it isn’t success.  Throughout my career, I’ve had products that have replaced shelfware in customers. Of course, these were the days of perpetual software licenses. With subscription software, customers simply can elect not to renew and in many cases this means that you actually lose money on this customer because you haven’t recouped your acquisition costs yet. They haven’t been customers long enough to see a return. So the real key to success isn’t simply selling your product, it’s delivering real sustainable value.  The best common measure I’ve found for this is usage.  People are busy, so having someone spend time in your product means that they are getting enough value that they elect to spend a very scarce resource – their time –with you.   Aligning your entire business are customers getting value from your product.

Good news.  Success isn’t something pre-ordained or innate.  You needn’t be a hero to achieve this — but it does take work.  Famed investor and entrepreneur Ben Horowitz talks about the ideas of “lead bullets” to connote that there is no magical solution to many problems — just a lot of small important activities all contributing to a positive outcome.

 

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