The food world is a world of uncertainty. We do not know what will happen in the future for sure. Moreover, all decisions of the product manager cost the company time and money. To make the most effective decisions, you need to rely on analytics, metrics and understand user behavior.
To do this, product managers use the methodology for conducting in-depth interviews with customers, otherwise Customer Development, or “custom”. The whole trick is that we go "to the fields", to feel the market in order to identify the real problem and user need that we want to solve with our product, without being attached to it. Imagine it is not there.
This allows you to formulate and quickly test new hypotheses, the value is just in a quick test. A product takes about 1.5-2 years of life for one case; on average, a product learns for 10 years. That is why there are few of them, and they are valued in business.
It is important for us to understand whether the user is really experiencing a problem that we want to solve with our product. This is confirmed by the fact that a person spends money and time on its solution, his lively emotional response to the interview is also considered. By asking questions during the interview, we can disclose this information in more detail, confirm or refute our hypotheses. It is important:
- Ask about experience - how much time and money it took to solve the problem.
- Make up the structure of the interview. By capturing the answers of many users to common questions, you can see patterns of behavior.
- Qualitative research checked quantitatively.
- Questions about the future do not give an invoice - how a person will actually act can differ greatly from his words.
What the research results allow to do:
- Get the first sales "manually."
- Formulate a value proposition.
- Describe the portrait of the client.
- Segment your current customer base.
- Justify the necessary costs, cut off excess bones.
- Set up marketing, sales and attraction.
I’ll tell you how I used it in my practice.
When I worked as a financial manager in an IT company, I manually collected the account base so that later it could be collected in the financial statements. I was looking for how to automate manual labor. Found QlickSense where you could write a macro. The macro pulled extracts from Internet banks in different countries, and made it possible to quickly collect them in the accounts payable report.
I thought - how can I immediately collect all the reports in a similar way? And does anyone need this at all? I began to write on the blog where I formulated my idea. Through a blog, I found entrepreneurs and sold them a manual assembly of the solution. For me, this was a confirmation of demand.
I wanted to put money from sales on development, so that I could scale up the solution later. So I got to the MIPT Business Incubator, where the main emphasis was just on “custom”.
I entered the leads from the blog in CRM. When I started conducting in-depth interviews at the Incubator, I was guided by the problem that I can solve for the client’s business, and formulated the offer from the problem. I was not attached to the product, I sold a manual solution. So I managed to segment customers, make different value offers, raise the average check and the number of sales. Well, okay, sometimes I had to spend the night in coworking.
My next goal was to get into the “Full-time Accelerator” of the IIDF in order to bring the product to the market. We went to Accelerator on partnership terms with another company from St. Petersburg, which was doing custom development for banks, made a product similar to mine, but it had no sales.
The emphasis was again on “custom”. In general, this is a process that should go not only at the very beginning of product development, but also in parallel with development. This allows you to adjust the processes of attraction, sales and remove the limitations of the business.
We checked even more segments, went “into the fields” - conducted interviews with small, medium, large businesses, banks. We described the segments, confirmed the demand by repeated sales at the exit to the next round of investment - the seed stage, the scaling stage. At our pre-seed stage, the emphasis was on interviewing, segmenting and testing marketing channels. And again, sometimes I had to spend the night in coworking.
But as a result, it turned out to make a frequent mistake for startups - they burned the base. Often, at startups, the product is under constant development and is not very well packaged for sale. Therefore, there is a risk of losing a potential customer if the call is unsuccessful, since the future customer will not contact you later. We checked all the customers whom we were able to sell to - sold, to whom we did not sell - we understood why it didn’t work out. The engagement was not configured to support the further development of the project.
Just at that time, Oleg Tinkov came to deliver a lecture for students at MIPT at the invitation of the MIPT Business Incubator. From the Incubator, 5 projects were selected that could be most useful to the bank. We were asked to prepare a pitch for 30 seconds, to talk about the problem that we are solving. After my speech, I asked for contact from a person inside the bank with whom to discuss further steps. Oleg Yuryevich contacted Fedor Bukharov, vice president and director of Tinkoff Business.
I came to visit the guys who develop non-banking services - Anton Tarasenko and Vitalik Arzumanyan. She talked about her work, the passage of acceleration. The guys suggested developing a similar product within the ecosystem — Tinkoff Business Management Accounting.
Previously, the team did not have the practice of discovery, more emphasis was on delivery - development, technical part. Therefore, I had to start from scratch to conduct interviews, record the results, do segmentation. There were also trials and errors. Some customers were denied because of uncomfortable questions about financial accounting, the topic is still painful and partly intimate. Someone asked: "And you are definitely from Tinkoff, can you find out everything about us?" Therefore, the interview process was adjusted every time, I changed questions, got as much information as possible about the client in order to better prepare.
For example, a forehead question: “How much do you earn, do you know for sure?” More often at first I caught a negative than a slightly changed, open question: “Tell me, please, how is the financial accounting in your company now arranged?” Then the person opens and begins to tell the details .
Further, I used the data obtained from the interviews to summarize the segment data into a financial model - it can be used to build product monetization and develop the ecosystem. Prior to this, the product was free for our RKO customers, but I tried to introduce additional paid products. I myself am not a salesman, so I attracted guys who do it better than mine. Together we did tests.
According to the results of interviews and tests, I brought all the data into a model. They appreciated the speed of sales and the necessary resources to start all processes - working with the current database, attracting new customers, sales and customer service. We realized that even if everything was put on the rails, it would be expensive for the bank. A reasoned decision was made to freeze the product.
Product closure is also a result. Of course, it was a shame when you put so much effort and time. It is no coincidence that among entrepreneurs they say that if you do not have experience in closing a business, then you are a “not real” entrepreneur. Moreover, the decision was based on the results of the interview, on the data, there was no point in investing further. Although with this product I rather got the role of an antiproduct, but I got a unique experience. In almost 2 years I was able to go through all the stages with the product: introduction to the market, growth, maturity (as my own project and inside the bank), closing.
There will be difficulties anyway. But it all depends on your reaction - what will you do when they arise? It is important to pay attention to the following things:
- Ask about experience. Ask how much time and money it took to solve the problem. When the research took place, I came to the company and found out how much time they spent on financial accounting, how much it cost the company, whether there were losses due to errors. Many, by the way, were reluctant to disclose certain things - financial accounting is still an intimate thing for some companies.
- Make up the structure of the interview. By fixing the answers of many users to common questions, we can see patterns of their behavior. We saw that most people use Excel as a convenient tool, it was one of the indirect competitors.
- Qualitative studies checked quantitatively for confirmation. Following the interview, we did mass mailings with a short questionnaire to confirm or refute our guesses.
- Questions about the future do not give an invoice. How a person actually acts can diverge greatly from his words. Therefore, look at the real actions and choices of people.
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Continue doing interviews until you learn something new. And read “Ask Mom” by Rob Fitzpatrick - this is a book on how to communicate with customers and confirm the correctness of their business idea if everyone is lying around.