I recently did work with a company that wanted help on marketing a new product. It was very cool. They had probably spent $1 million to $2 million and a couple years developing it, but they had no idea who would buy it, or even if it was a consumer or industrial product.
They had not talked with any customers before developing the product and when I looked at it, cool as it was, I didn’t think that it was necessarily better at anything than what already existed. In many ways it was inferior.
I suggested a number of ways that inexpensively they could get it in front of different customers with different needs and messaging, but they found out that there really wasn’t a niche for it. There wasn’t, in startup language, product/market fit.
Management should have known better. This wasn’t a startup; the company had been around for years. But by not taking the time to talk to a few dozen potential customers they had wasted a couple million dollars.
On the other hand, in the early ‘90s I helped a large telecomm company study the home video-on-demand market — which at that time was still just a dream. They wanted to know how much more consumers would pay for the convenience of streaming movies at home anytime that they wanted to instead of having to go to a videotape rental store?
The answer was $0.
That was not the answer that they were expecting, or hoping for, but at least now they knew what they could expect to charge. And to this day we can stream movies on demand for just a few dollars.
Talking to customers costs almost nothing and yet invariably returns valuable, unexpected insights. Whenever I’ve done customer interviews for companies the CEO has been amazed at what their customers actually want, compared to what they thought they wanted. And this is true even in service companies where presumably they are close to their customers and have frequent conversations with them.
Have non-sales, listening conversations with customers regularly.
