Once you have completed your first iteration of your business model, it is a good time to dive deeper into your assumptions about the various elements of your business. We recommend that you start about your core assumptions about the problem your venture is trying to solve and is it aligned with what your target customer wants and needs.
The Customer’s Task. A good way to better understand what problems the customer is experiencing, is to start with what they are trying to accomplish in the first place. We usually run into a problem or challenge while we are attempting to accomplish a specific task. It could be a simple task like changing a lightbulb or something more complex like navigating a foreign city for the first time. Tasks can range from functional to social, from satisfying an essential need to something more aspirational. Whatever the task, and no matter what the degree of challenge, there is usually some aspect that can be improved, making it easier or less costly in terms of money or time. Your first step is to probe the details of the customer’s task and learn all the challenges experienced before, during, and after the task is complete.
In today’s parlance, we call these challenges the customer pain points. These challenges can be emotional, creating undue stress or annoyances. Pain points may be caused by undue dollar expense, wasted time, or excessive effort. Once you identify the problems, it is important to see if there is a way to quantify the challenge using some metric. For example, if the customer feels that a task takes too much time to complete, find out how much time does it take. This will serve baseline by which you will be able to measure the improvement generated by your venture’s solution.
As you identify the challenges that the customer experiences while involved doing a certain task, you should delve into how important it is to the customer that the problems be solved. As task doers, we all run into inconveniences and challenges, some create minimal annoyance, while others can be experienced as quite severe. Once you have a good understanding of the customer’s task and the challenges that are causing some type of pain, you can explore what they would expect from an effective solution. Level of severity can be measured in several ways. A quick way to assess the customers perception of pain severity is to ask them to rate it on a scale of 1-5, with a rating of 1 denoting low severity and 5 indicating a high level of pain. A more quantifiable measure is to ask the customer to provide specific metrics indicating levels of severity.
Going back to the time example, if you know how much time a task generally takes, you can ask the customer to bound the time spent, asking what is an acceptable level of time spent and what would be an unbearable amount of time spent on a task. With this information, you can see assess the current level of pain as well as learn what the customer sees as an acceptable level, providing you with a quantified target for your solution.
Once you have a good sense of the problem and its severity, you can begin to identify and evaluate how the customer currently solves the problem or diminishes the pain associated with the problem. This line of customer research helps to identify what competing or alternative solutions already exist in the market place. You will not only learn about your competitors, but you can assess how effective the solutions are and how are they underperforming. Again, as before, you should try to quantify how the current solutions are underperforming. So in our ongoing sample, you can find how much time the customer is taking with current solutions and compare with what they have defined as acceptable levels of time spent.
As a final step, you can ascertain what the customer might expect from an improved solution. In other words, what benefits would be expected from a better solution than what currently exists. For example, if the customer would want a solutions that minimizes the time spent of task by more that 50%, then you have a benchmark for your proposed solution.
By going through this process, you will have better defined how the customer experiences the problem, how severe is the pain associated with the problem, how they currently solve the problem, and what benefits they expect from a better solution.
In summary, here are the steps:
– Start with customer problem.
– What task or job is the customer trying to do?
– What challenges are they experiencing as they attempt to perform the task/job? [Quantify the challenges]
– How important is it to the customer to solve these problems? [Rate problem severity and/or importance of finding a solution]
– What solutions are customers currently using to solve or diminish the challenges?
– How are these solutions underperforming? [Quantify performance]
– What benefits does the customer expect from a better solution? [Quantify improved performance]
– Start with your proposed solution.
– How does your solution alleviate the customer problem [Quantify problem reduction]
– How does your solution improve upon current solutions? [Quantify improvements]
– Will your solution meet or exceed customer expected benefit/value [Quantify customer benefits/value]
– Consider which assumptions have to be right for your venture to be a success? List these assumptions.
– Design your customer discovery interview questions to test assumptions (see Customer Discovery Interview Prep Worksheet)
The above process helps to identify the core assumptions you have about the customer, problem, solution, and expected benefits. Once defined, you can create interview and/or survey questions to test these assumptions with potential customers.