3 ms·

First, this was not written by Steve Blank, but rather Bob Dorf. In any case, I completely disagree with this notion that customers are some complex, mysteriou

by dkrich 14y ago

First, this was not written by Steve Blank, but rather Bob Dorf. In any case, I completely disagree with this notion that customers are some complex, mysterious enigmatic force that require a laboratory and several months of conversations to build a successful product for. I think the best advice is to start by building something useful. People pay for utility. If you can make tasks significantly easier, or enable people to do things they couldn't previously do, they will pay you. The sad reality is that most startups suck because their products simply don't meet that criteria. They come up with an idea and just start building it, without actually using it themselves. A good sign you've got a winner is if you yourself find that you miss not being able to use it. If you don't, then don't expect anybody else to pay for it. All that said, talking to people accomplishes nothing. People have no idea what they want. They are typically followers and do what they are told and use what is put in front of them. That's why the best products are typically not built by large corporate research departments, but rather single innovators solving a single problem with which they are intimately familiar.

Domenic_S 14y ago
> I completely disagree with this notion that customers are some complex, mysterious enigmatic force that require a laboratory and several months of conversations to build a successful product for. Customers are intrinsically complex because they lie. Sometimes unknowingly, but they do. Here are some ways I've personally experienced it (I'm going to say "lie" in quotes because often they're not trying to intentionally mislead you): 1) They "lie" about their objective: Spend some time selling, even somewhere low-pressure like a hardware store. All day everyday customers will tell you they want A when they really need B. Granny tells you she needs some CLR, but when pressed, it turns out she's trying to fix a leaky faucet. She actually needs a new valve. 2) They "lie" about their actual need: This happens in consulting frequently. "We need a team of 5 to finish this project for us" - in actuality the project was ill-conceived, the business is falling apart, and what they really need is strategy/finance/etc consulting. 3) They "lie" about what they'd pay: Needs little explanation; it's why experienced businesspeople tell you that promises for orders are worthless and actual orders (with P.O./check attached) are golden. > People have no idea what they want. Quite true, but you can get to the bottom of what they need with a skillful enough approach. The thing is, you have to talk to potential customers or you're taking on more risk than you need to. Yes, you can build something "useful", but what you and I find useful might be useful to 0.0001% of the population and not have wide enough appeal to make a business out of. If your product is simple or easy-to-understand enough, your conversation can be a simple sales pitch and a preorder form -- if you get the orders, customers want it. Boom, validation. Don't waste your life building something you and your buddies/family think is useful until you find a bunch of people willing to pay you for it.
- dkrich 14y ago
  "The thing is, you have to talk to potential customers or you're taking on more risk than you need to. Yes, you can build something "useful", but what you and I find useful might be useful to 0.0001% of the population and not have wide enough appeal to make a business out of. If your product is simple or easy-to-understand enough, your conversation can be a simple sales pitch and a preorder form -- if you get the orders, customers want it. Boom, validation. Don't waste your life building something you and your buddies/family think is useful until you find a bunch of people willing to pay you for it." I'm sorry, I completely disagree with this line of thinking. When you make something useful for a market large enough to make a successful business out of, there is no mystery. I think we lie in the product development phase by telling ourselves that we are going to make X much easier than it is today but in reality we are just making an additional way to do something that may or may not save people any time or accomplish something that they couldn't do before. Yes, people do lie about what they need/want, but there can still be money selling into that market. What I'm referring to is obvious, large jumps in innovation. Would another system for writing down todo's sell if I could integrate it with Outlook? Maybe, maybe not. I'd have to hear more and have it demoed, etc., etc., etc. In any case I probably wouldn't pay anything for it. How about a car that travels on 1/3 the gas of a typical sedan and costs $300? I'd be interested in buying that no matter what. It turns out the challenge is not in understanding customers, but having the ability to build things that are really, obviously useful. Obviously those are extreme examples, but if you look at a more granular level, the same applies. If you have to complete some job every day that requires three hours, and somebody shows you a tool that can automate much of the work and have it done in ten minutes, I think it's safe to say you'd open your wallet. Most startups don't provide that type of utility, and thus fail at closing any customers.
  - Domenic_S 14y ago
    > When you make something useful for a market large enough to make a successful business out of, there is no mystery. This statement is where a trope, meme, and axiom collide in a nuclear reaction. Sure there's no mystery, but you're describing the end state after you've already done all the analysis. Although you're also missing the 'profitability' metric, which is important. make something useful for a market: How do you know what's useful? You've used the "saves time" metric a couple times here, but that isn't always enough. Bikes save time over walking, but people still walk. Cars save time over bikes, but people still bike. Ditch-digging machines are orders of magnitude faster than human ditch diggers, but people still dig ditches. Buying fast food saves time over cooking, but people still cook. Netflix is more efficient than cable and Redbox, but people still buy cable and rent from Redbox. Quickbooks is more efficient than paper bookkeeping, but legions of small businesses still use paper. The examples go on forever. You can't know if your product is useful unless it's fundamentally obvious (lightbulbs, toaster, eyeglasses, cups, dog food) and most products aren't this way. Most are incremental improvements on stuff we've owned or done forever. Is your product a significant enough increment? That's where validation comes in... for a market large enough: The perpetual question. Total addressable market is not a simple thing to figure out. Surely you're familiar with the traditional startup pitch: If we could get just 1% of this billion-dollar market... It's a dream-killer, that one. And it's really only useful in context -- consider a theoretically perfect product like, say... perfect socks. They magically match whatever clothes/shoes you're wearing, automatically adjust thickness depending on your feet and shoes, wick moisture better than anything else, and never wear out. Addressable market: everyone who wears socks. Home run. But now say they cost $10,000/pair to manufacture. Total addressable market: like 500 people. From a home run to hit-by-pitch just like that. My point: TAM is important, and non-trivial to calculate for all but the simplest idea. Talking to customers helps figure out what segment of the market 1) wants your product and 2) will/can pay for your product. to make a successful business out of: That means margin and profit. If your theoretical $300 sedan above cost $350 to manufacture, it doesn't matter how revolutionary your idea was. The LIFX bulb is a possible example of this. Can LIFX deliver on their product for $70/each? A lot of people are saying it's impossible. If it ends up costing them $100/bulb to make it exactly like their Kickstarter campaign says it will be, that business is not going to be a successful one. There are armadas of good products & services that went belly up because they cost too much to make compared to what people would pay.

by dkrich 14y ago

Domenic_S 14y ago

> I completely disagree with this notion that customers are some complex, mysterious enigmatic force that require a laboratory and several months of conversations to build a successful product for. Customers are intrinsically complex because they lie. Sometimes unknowingly, but they do. Here are some ways I've personally experienced it (I'm going to say "lie" in quotes because often they're not trying to intentionally mislead you): 1) They "lie" about their objective: Spend some time selling, even somewhere low-pressure like a hardware store. All day everyday customers will tell you they want A when they really need B. Granny tells you she needs some CLR, but when pressed, it turns out she's trying to fix a leaky faucet. She actually needs a new valve. 2) They "lie" about their actual need: This happens in consulting frequently. "We need a team of 5 to finish this project for us" - in actuality the project was ill-conceived, the business is falling apart, and what they really need is strategy/finance/etc consulting. 3) They "lie" about what they'd pay: Needs little explanation; it's why experienced businesspeople tell you that promises for orders are worthless and actual orders (with P.O./check attached) are golden. > People have no idea what they want. Quite true, but you can get to the bottom of what they need with a skillful enough approach. The thing is, you have to talk to potential customers or you're taking on more risk than you need to. Yes, you can build something "useful", but what you and I find useful might be useful to 0.0001% of the population and not have wide enough appeal to make a business out of. If your product is simple or easy-to-understand enough, your conversation can be a simple sales pitch and a preorder form -- if you get the orders, customers want it. Boom, validation. Don't waste your life building something you and your buddies/family think is useful until you find a bunch of people willing to pay you for it.

dkrich 14y ago
"The thing is, you have to talk to potential customers or you're taking on more risk than you need to. Yes, you can build something "useful", but what you and I find useful might be useful to 0.0001% of the population and not have wide enough appeal to make a business out of. If your product is simple or easy-to-understand enough, your conversation can be a simple sales pitch and a preorder form -- if you get the orders, customers want it. Boom, validation. Don't waste your life building something you and your buddies/family think is useful until you find a bunch of people willing to pay you for it." I'm sorry, I completely disagree with this line of thinking. When you make something useful for a market large enough to make a successful business out of, there is no mystery. I think we lie in the product development phase by telling ourselves that we are going to make X much easier than it is today but in reality we are just making an additional way to do something that may or may not save people any time or accomplish something that they couldn't do before. Yes, people do lie about what they need/want, but there can still be money selling into that market. What I'm referring to is obvious, large jumps in innovation. Would another system for writing down todo's sell if I could integrate it with Outlook? Maybe, maybe not. I'd have to hear more and have it demoed, etc., etc., etc. In any case I probably wouldn't pay anything for it. How about a car that travels on 1/3 the gas of a typical sedan and costs $300? I'd be interested in buying that no matter what. It turns out the challenge is not in understanding customers, but having the ability to build things that are really, obviously useful. Obviously those are extreme examples, but if you look at a more granular level, the same applies. If you have to complete some job every day that requires three hours, and somebody shows you a tool that can automate much of the work and have it done in ten minutes, I think it's safe to say you'd open your wallet. Most startups don't provide that type of utility, and thus fail at closing any customers.
- Domenic_S 14y ago
  > When you make something useful for a market large enough to make a successful business out of, there is no mystery. This statement is where a trope, meme, and axiom collide in a nuclear reaction. Sure there's no mystery, but you're describing the end state after you've already done all the analysis. Although you're also missing the 'profitability' metric, which is important. make something useful for a market: How do you know what's useful? You've used the "saves time" metric a couple times here, but that isn't always enough. Bikes save time over walking, but people still walk. Cars save time over bikes, but people still bike. Ditch-digging machines are orders of magnitude faster than human ditch diggers, but people still dig ditches. Buying fast food saves time over cooking, but people still cook. Netflix is more efficient than cable and Redbox, but people still buy cable and rent from Redbox. Quickbooks is more efficient than paper bookkeeping, but legions of small businesses still use paper. The examples go on forever. You can't know if your product is useful unless it's fundamentally obvious (lightbulbs, toaster, eyeglasses, cups, dog food) and most products aren't this way. Most are incremental improvements on stuff we've owned or done forever. Is your product a significant enough increment? That's where validation comes in... for a market large enough: The perpetual question. Total addressable market is not a simple thing to figure out. Surely you're familiar with the traditional startup pitch: If we could get just 1% of this billion-dollar market... It's a dream-killer, that one. And it's really only useful in context -- consider a theoretically perfect product like, say... perfect socks. They magically match whatever clothes/shoes you're wearing, automatically adjust thickness depending on your feet and shoes, wick moisture better than anything else, and never wear out. Addressable market: everyone who wears socks. Home run. But now say they cost $10,000/pair to manufacture. Total addressable market: like 500 people. From a home run to hit-by-pitch just like that. My point: TAM is important, and non-trivial to calculate for all but the simplest idea. Talking to customers helps figure out what segment of the market 1) wants your product and 2) will/can pay for your product. to make a successful business out of: That means margin and profit. If your theoretical $300 sedan above cost $350 to manufacture, it doesn't matter how revolutionary your idea was. The LIFX bulb is a possible example of this. Can LIFX deliver on their product for $70/each? A lot of people are saying it's impossible. If it ends up costing them $100/bulb to make it exactly like their Kickstarter campaign says it will be, that business is not going to be a successful one. There are armadas of good products & services that went belly up because they cost too much to make compared to what people would pay.