This presentation was given to the participants in Boston's 2013 Lean Startup Challenge on day 1 of bootcamp by Brian Gladstein of Explorics. Our teams had filled out their Lean Canvas, so this session and workshop was designed to help them put together a plan for generating hypotheses and conducting interviews to validate the elements of their canvas. Topics covered: - Finding the gaps in your lean canvas - Introducing the concept of customer development as a way to fill those gaps - What is problem-solution fit - What is product-market fit - Creating hypotheses for customer discovery - Segmenting your target customers - Prepping for customer interviews

1. Customer
Development
Designing the customer you want
September 21, 2013 | Boston, MA

2. We are getting
ready to get out
and talk to people

3. take a look at your lean canvas

4. value creation
how you create value – the problem you are solving

5. value capture
the money

6. value delivery
getting value into the hands of customers

7. where is your biggest gap?

8. customer development is
a pathway to
address the gaps
in your lean canvas

10. product
development
is to
[coding,
machining,
formulating]
customer
development
is to
???????
as

11. product
development
is to
[coding,
machining,
formulating]
customer
development
is to
[interviewing,
surveying,
pitching]
as

12. product
development
is to
something
someone buys
customer
development
is to
??????
as

13. product
development
is to
something
someone buys
customer
development
is to
how someone
buys it
as

14. the big picture
STOP
Customer
Validation
STOP
Customer
Creation
STOP
Customer
Discovery
STOP
Company
Building
Iteration Execution
Turn hypotheses
into facts
Identify scalable
and repeatable
sales model

15. one level deeper

16. problem-solution fit

17. problem-solution fit

18. product-market fit

19. product-market fit

20. customer discovery

21. • State your hypotheses
• Test the “problem”
• Test the “product”
• Verify

23. hypotheses
Customer/Problem Hypotheses
• Types of customers / archetypes
• Magnitude of the problem
• Visionaries
• A day in the life of a customer
• Organizational impact
• ROI justification
• Problem recognition
• Minimum feature set
Product Hypotheses
• Features
• Benefits
• Product delivery schedule
• Intellectual property
• Total cost of ownership
• Dependency analysis

24. hypotheses
Distribution/Pricing Hypotheses
• Distribution model
• Distribution diagram
• Sales cycle / ramp
• Channel strategy
• Pricing (ASP, LTV)
• Customer organization map
• Demand creation
Demand Creation Hypotheses
• How do competitors create demand?
• How will you?
• Dave McClure’s AAARR model
• Who are influencers / recommenders?
• Key trade shows?
• Key trends?
• Start assembling advisory board

25. hypotheses
Type of Market Hypotheses
• Positioning and Differentiation
• Existing market: the product is the basis of competition
• New market: creating the market is the basis of competition
• Redefine existing market: resegmenting the existing market is the
basis of competition
Competition Hypotheses
• Who is out there?
• Why are they important?
• How do customers use them today?
• What don’t customers like about them?

26. Exercise 1: State your hypotheses
Customer / Problem Product Distribution / Pricing
Demand Creation Type of Market Competition / Alternatives

27. • State your hypotheses
• Test the “problem”
• Test the “product”
• Verify

28. Get out
of the
building!

29. But... who ya gonna call?

30. customer segments

31. why segment?
http://www.youtube.com/embed/LQqq3e03EBQ

32. price
flexibility
customer
experience
service

33. a segment is
• an identifiable group of people
• who buy
• a common good or service
• for a common reason

34. describing your customers
• Markets you serve
• Geographic regions
• Business or consumer
• Demographic
• Life stage
• Economic dynamics
• Size of segment
• Titles and associations 34

35. Who they are + how to find them
Where they gather + can easily qualify
Don’t know where they gather + can easily qualify
Don’t know where they gather + deep qualification
There is no way to qualify them
A
B
C
D
F
how identifiable is your customer?

36. Exercise 2: Your segment
Persona Where they gather
How you qualify Why they care (problem hypothesis)

37. Tools for talking
to customers

38. 38
http://www.ted.com/talks/simon_sinek_how_great_leaders_inspire_action.html
People don’t buy
what you do. They
buy why you do it.
Simon Sinek
How Great Leaders Inspire Action

39. 39
Milkshake marketing: what is
the job the customer is hiring
our product to do?
http://www.youtube.com/embed/VmbSpTJXozk
Clayton Christensen
Market Disruptions & Online Learning

40. customer empathy map

41. your test plan
• What part of the lean canvas do you want to test?
• Who will you test with?
• How will you reach them?
• What is the test?
• How will you measure?