How to Find Customers and Build Products and Services They Want: Customer Discovery

How stressful is it to keep asking yourself:


Am I building the right product that solves a pain?

Is it what customers want?

Am I wasting my time and money?


In this article we'll look at customer discovery to answer this and understand:

Customer Discovery
  • How to create relevant business hypotheses
  • 10+ ways to find your ideal customers
  • How to approach them so they actually will talk to you
  • How to complete customer interviews in 2 days and what to learn from them

You’ll also get:

  • A free 5 Day E-Course at the end of this article with all the scripts, templates and resources to make your Customer Discovery a walk in the park.

So what happens despite these stressful questions above?


You keep a completely cool and composed appearance ​and show the world

“I got this!”

Truth is:


For you to “got this” that’s where Customer Development methodologies come in.


Where the key question to answer is:


“Will customers actually buy it?” 


In fact, every hour spent on customer development saves 5–10 hours of writing, coding or design.

Customer Development saves time

So much so, that ignoring customer development was listed as one of the Top 20 reasons why startups fail according to CBInsights.

Yet, ​some still believe they already know what the customers want and the best thing would be to build the product asap.

Actually, no.

In the words of Warren Buffet:

“Don’t test the depth of the water with both feet”

As long as the products you build are for customers, then logically, the 2 go hand in hand. We can’t focus on one and forget the other.

The good news is that understanding the customer development model is easy and acting on it takes much less time than expected.

Let’s jump in!

What’s the point of customer discovery?

“When your product solves a problem that costs customers sleep, revenue or profits, things are definitely looking up”

Steve Blank

Customer Discovery is the first of the 4 stages of The Customer Development Process pioneered by Steve Blank in the 90’s.

He started it after noticing countless startups fail because of not understanding how customers think.

It’s a focused process that helps you test your assumptions about your business using direct feedback from customers.

There are 3 crucial points to Customer Discovery:

  • 1
    When you meet potential customers, you develop a better understanding of your target audience and build your client base at the same time.
  • 2
    Customer Discovery is more about “breaking your assumptions” rather than confirming them. It is very easy to fall into the Confirmation Bias trap where we tend to search for information that confirms our beliefs.
  • 3
    It is not about selling your product or solution to the customer. It’s about uncovering the information that would allow you to design a suitable solution.

Customer Discovery Starts with your Hypotheses

Can you relate to this?

When I first started with business, all I did was think.

I used to think about how the idea would help people, how it would function, where it could go wrong, who it would annoy​ and on and on.

An unstructured, unproductive and disconnected train of thought.

Today, we can figure out in minimal time, if the idea is even worth a business.


Here's where to start:

The Lean Model Canvas by Ash Mauyra (adapted from the Business Model Canvas by Alex Osterwalder) is excellent for this.

It forces you to direct your thinking towards urgent aspects of the business.

Almost instantly organizing your thoughts and relevant assumptions around your business idea.

These assumptions can then be assessed for idea credibility using customer discovery interviews.

Lean Model Canvas

Best of all, it’ll take 30 minutes flat.


Here's a step by step breakdown for completing your canvas.


Mixing this canvas with the Validation Board by the Leanstartupmachine is an impressive combo.

The Validation Board is another powerful tool that is super easy for tracking how your core assumptions progress based on the responses from your customer discovery interviews.

Furthermore, it ensures you measure the success of your assumptions by having a pre-set definition of the lowest possible outcome to consider your idea proven.

Validation Board

These tools simplify creating a quick overall view of your business and determining what needs to be verified to decide if the idea is worth pursuing.

Now that you're armed with your business assumptions

It’s time to find customers to interview to test your ideas.

How To Find Customer Discovery Interview Candidates

1. Start with Other Peoples Network, Not Yours

Here’s the thing:

Alot of the time early entrepreneurs start with almost no business network.

On the surface, although this looks like a disadvantage, it can be blessing in disguise.

Why?

Because interviewing your personal contacts can bias and influence the results you collect.

Instead, ask family and friends for introductions to their network.

For example:

When I first started I out, I didn’t know much about business but I did realise that talking to potential customers would be a good way to know if what I wanted to do was worthwhile.

I only knew a handful of people that were in business which wasn’t enough to reach my target of 50+ people.

So:


I asked the few that I knew, I asked my brothers, my friends and anyone I could think of if they could introduce me to their network.

And that’s how I generated a 50+ list of my target market in under a week.

Surprisingly, the result was a 100% response rate from this list.

Every call was answered and people took the time to have a chat because of the introduction.

It’s a different story that my product still flopped, but that was because my interview questions were rubbish not because I couldn’t find people to interview.

2. Be Social Without Being a Wierdo

How do you approach a person you don’t know?

To have any chance with cold outreach on social channels, make it clear that you’re not selling any products or services.

Frame your outreach for what it is, research. Here's a great explanation by Alexander Cowan.


In fact, research is the best way to frame your approach to customers regardless of the type of interview format you use.

I tested this with my LinkedIn network by contacting 10 people that I did not know personally but fit my target audience.


Result?


5 responses of which 3 went on to complete the customer discovery questions.

30% response rate is not bad.

However, you can expect to face problems with response time and feeling annoyed with this approach.

Why?

Because following up 3+ times with people that said they’d be “happy to help” is not fun.

Here’s an example of a template you can use:

Customer Interview Screener Question

To ensure you’re not wasting anyones time, include a screener question in your customer discovery outreach..

In the above example, my screener question is asking if they are currently using or have used a third party provider recently.

Those that say no, thank them for their response and you move on.

Those that answer yes to the screener make it through to the next stage where you have a conversation that leads to asking questions such as:

Customer Discovery Interview Questions

And that's how to use social to reach out to your target audience


Note that this approach can be used across social channels, social groups, forums etc.

But, this brings us to a crucial point.

What do you do if you have literally zero network to start from?

3. Customer Discovery Interviews Even If You Don’t Have A Network

What if you’re family, friends and social connections do not have access to the type of customer you want to talk to?

What if you have a very specific type of customer?

Like startup founders that used Buzzsumo in the last 2 weeks.

​In this case, reaching out to friends for introductions and your social contacts probably won't work.


What to do?

Here’s where your Lean Canvas helps again.

Because if completed, you would have listed where your customers can be found (see your Lean Canvas — Customer Channels).

Let's stick with the startup founders example for a minute:


You might list the following customer channels:

  • Startup Meetup groups (let the organizer know what you are doing and ask if he/she would allow you to address the group)
  • Podcasts (reach out to the organizer and ask for promotion or introductions)
  • Startup Youtube Channels (same as above)
  • Relevant blogs, groups or forums (reach out to admins/moderators for help)
  • Discussion platforms such as Reddit, Quora (check startup threads)
  • Local gathering spots
  • Networking events (for example: MFYF, Under The Stars)
  • Startup events/conferences
  • Business centers
  • Co-working spaces (have a look at Our Space, Nest)
  • Accelerators and incubators (have a look at Sheraa, Astrolabs, Intelak)
  • Professional Associations (have a look at Mind Cloud Academy)
Multiple options to find customers

See the potential you can tap into?


And that’s not even a complete list.

(Bonus: here’s a pdf for you for easy reference of all the above options for finding customers PLUS 3 added options not mentioned in the article)

The idea is to create your list of customer channels for the type of customer you seek, decide on the most effective channel and head straight there.

If your customer requirements are specific like the earlier example, then creating strong screeners will help your recruitment efforts.

Keep 2 things in mind:

  • 1
    The people in these locations are there for a certain reason and it’s not to answer your research questions. That’s why reaching out to admins and moderators is a good idea since they can influence the group.
  • 2
    It might make sense to compensate interviewees for their time. Think about the compensation you offer carefully as you don’t want to offend anyone. For example; compensating a student is not the same as compensating a manger and what they want is not always financial.

4. Spending on Customer Discovery

If you’re ok with spending some money, here are two more options for finding interview candidates:

  • 1
    Hire a survey company that would find the interviewees and/or conduct customer discovery interviews too (such as Nielsen). Although, this may be quite expensive and take more time than doing it yourself
  • 2
    Targeted Ads on social media and/or online classifieds. Open the miscellaneous or et cetera section on sites like Dubizzle or Craigslist. Create an ad explaining that you are conducting customer research interviews and offering compensation for completed interviews and selection questionnaires.

This option is fantastic because:

  • You post your ad only where relevant people will see it
  • A stronger selection process means you find more qualified customers
  • The customers are interested in your interview
  • You can ask to meet customers in person
  • It’s simple and fast

For a deep dive into this, see the explanation by Michael Margolis from Google Ventures and Jake Knapp.

There, now you can find customers whether you have a network or not.

Next step.

How do you conduct a customer interview to validate your hypotheses and business?

Just Talk to Customers is Lazy Advice

It’s frustrating isn’t it?

When people say “It’s so easy! Just find your target customer, talk to them, learn and Boom you’re good to go!”

Useless advice.

We’re more interested in hearing, how and what we should learn from these interviews?

How do we ask our questions and take control of the interview?

Have a look at this:


Your hypotheses to test (from your Lean Canvas) can be divided into 4 categories of questions:

  • Customer hypothesis: Is this the right type of customer?
  • Problem hypothesis: Does the problem exist?
  • Problem hypothesis: What are the most significant pain points?
  • Solution hypothesis: The alternatives they have and how they are currently solving the problem
  • Value hypothesis: Whether your value proposition is valid?

To get the highest value from your customer discovery, prepare your key questions (and follow up questions) in advance.

Gear your questions towards obtaining the answers for the above categories.

Breaking down your questions into categories provides clarity on what you want to learn during your interview as explained in this Customer Discovery Handbook.

(Bonus: I’ve put together a list of 20 categorized interview questions at the end of this article so that you avoid missing any relevant info from your customer interviews)

Now:

Let’s talk about How to ask questions and how to interview customers to uncover the info you need.

11 Tips On How To Learn From Customer Discovery Interviews

  • Seek for them to speak. Keep reminding yourself to listen more than you talk
  • Encourage meaningful answers based on your customers knowledge and feelings. Start questions using who, what, where, why, when and how.
  • Avoid leading questions that begin with “Would you..”, “Did you..”, “Is it…” “Don’t you…”
  • Ask for personal examples in your follow up questions such as “Can you tell me an example of the last time that happened?”
  • Remember, it’s a conversation not an interrogation
  • You get no ROI from unclear information. If a response is vague, ask for clarification saying “That’s interesting! Could you explain that a little further?”
  • Don’t think your time is more valuable than theres. You’ve come prepared so there’s no need to exceed the agreed duration. Respect their time.
  • Accept that there is no right or wrong answer from the customer. You only want to understand their thoughts. So be careful not to introduce your own ideas in your questions.
  • If an assumption is disproved, use follow up questions. For example; “Can you tell me a little more about why that is the case?” You’ll build a deeper understanding of the problem from their perspective.
  • Don’t talk about your proposed solution, don’t talk about features, don’t ask how they would theoretically solve their problem - save those questions for product testing.
  • We are not human memory sticks. Write down your notes and thoughts ASAP after each interview (even if its recorded). You’ll risk mixing up ideas from different interviews if you start the next session before completing this.

Customer Discovery Interview Duration

The aim is not to ask 50 questions and badger the person generous enough to share their time with you.


Neither is it to spend as much time as you can in the interview.


This presentation from Carnegie Mellon University suggests 15 minutes interview time is sufficient.


I find 30 minutes works for me because it gives both the customer and myself time to relax, think and open up in the discussion.


And finally, interview quantity.


How many customer interviews should you target?


This Nielsen study suggests 5 are enough to gather relevant data but this is not set in stone.


If you march “in person” to the customer channels you listed, you could have 10+ interviews and amazing data about your customers in your hands within 2/3 days depending on your niche.


I have to admit, that when I first tried this I took over a week because I was taking up time just figuring out what my next step would be.


Luckily by reading this post you won't have the same problem.


Again, check out the articles by Michael Margolis at Google Ventures.


They’ve got the full research sprint (including preparation time) nailed down to 4 days total with interviews taking just 1 day.


How do you know when you’re done?


Your job is to pay attention to similarities in the responses.


Once a pattern starts to appear, you’re on the right track.

“The best indicator that you’re done is that you stop hearing people say things that surprise you"

Cindy Alvarez

Conclusion

There are many reasons why entrepreneurs overlook customer discovery.

But understanding how customers think is part of making successful products.

No matter how tough it seems, you are tougher.

You know:

What needs to be done and why.

How to find customers and interview them.

How to verify your core business assumptions and learn what they want.

By doing this, you’ll provide solutions that make a difference and empower customers.

And for that, they will buy your products.

All in all we’re talking about a process of only a few days.

So trust yourself. Kick that self-doubt out.

As promised:

Get access to your Free 5 Day Ecourse Here with the scripts, templates and resources to help you put it all together

There’s absolutely nothing to hold you back.

Interview your customers.

Make needed products.

Let me know where you'll start in the comments below.

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