What Is Customer Discovery?
Updated: Jul 10, 2020
Behind every great product is a customer with a problem that has been solved. The solutions to these problems are embedded in the lives of consumers. Companies need to excavate beyond bias and learn from their customers in order to help inform the design process and deliver products that the market wants and needs. This simple, human-centric realisation forms the basis of an approach called Customer Discovery.
Are You Listening to Your Customers Yet?
Traditional market research, a tale as old as entrepreneurship itself, is being thoughtfully reworked with a focus on qualitative data through the discovery discourse. With customer discovery, the objective is to identify your first customers by taking your main assumptions about who your customer is, the problem you are solving, as well as how the customer will buy from you—and turning those assumptions into hypotheses which you will then test. These tests are conducted mainly through interviews with potential customers.
This deep dive approach is a relatively new but pivotal mechanism in the fast-paced startup sphere, however, established companies can reap the benefits of employing an exploratory process to affect products in development. It is therefore within reach of every business, whether product, service or digitally oriented.
Empathy + Insight = Customer Delight
As a scientific approach, a customer discovery blueprint should be adapted to allow anyone from founders to product teams and strategists the ability to test and collect customer responses as usable data. This research method allows for understanding the human condition and establishing the true drivers of behaviour. Once companies acknowledge the issues faced by their customers, they are presented with the advantage of designing sensible and deliberate products that meet market needs and wants.
Steve Blank, a renowned entrepreneur, first coined Customer Discovery as phase one of the Customer Development framework. It is therefore almost always associated with a quote from his cache of business insights: “There are no facts inside your building, so get outside”. This simple phrase punctuates the importance of gathering information beyond the office by testing the common preconception that companies know what customers need more than they themselves do.
What makes the difference between a failed product and a successful one?
The answer to this isn’t transparent. Commonly, failed products and businesses didn’t find the right customer to begin with. There are countless variables that could impact or predict whether a product is well-received by consumers. However, customer discovery presents an opportunity of improving the chances of success. Why? Because it holds fast to the concept of progress as a consequence of systematic testing, learning and continuous iteration.
According to Cindy Alvarez, a product manager at Microsoft and the author of Lean Customer Development, “most new products (and companies) fail. The odds are against you. Around 75% of venture-backed start-ups fail.3 Anywhere from 40% to 90% of new products fail to gain significant market adoption.4”
These statistics are enough to make the most enterprising individuals retract their ideas from the drawing board. Still, it offers the salient observation that organisations should seriously practice customer development in union with product development. By implementing a customer discovery plan, organisations acquire information that drives product and business model iteration. This will reduce the risk of squandering design, production and marketing efforts as well as scant resources.
The Bottom Line: It’s About Learning, Not Selling
The fundamental truth underpinning customer discovery is that conversions happen when human needs are met. For companies to succeed, they need to leverage the power of human centricity and, most importantly, curiosity.
The Voyc customer discovery platform helps companies understand their customers by turning their customer research into insights, personas, and customer journey maps.