What is Customer Discovery?
Customer discovery is the means of focusing on the four blocks of the lean canvas (customer segment, problem, solution, and unique value proposition), establishing assumptions, and converting the assumptions to hypotheses that will be subjected to test.
You need customer discovery at any point in time in your business. Either you’re still at the ideation stage, prototype stage, or you already have a fully developed product.
As long as you need to find more customers for your product/services and you need more revenue, then customer discovery is for you. It is something that you will always do as your business progresses.
You also need customer discovery to understand and serve customers’ needs, pain points, and challenges.
Steps in Customer Discovery
1. State Your Hypothesis: These are based on the assumptions you make concerning your market, problem, and solution. The hypothesis will define both the problem you intend to solve and the solution to the problem. There are different types of hypothesis
- Problem Hypothesis: It focuses on the problem you aim to solve. It deals with the scope of the problem.
- Solution Hypothesis: It focuses on your suggested solution to the problem you’ve identified. Would your customers accept the solution to the problem?
- Price Hypothesis: It focuses on the viability of the solution. Will your customers buy at your set price willingly? Can the solution generate revenue for your business?
- G0-to-market Hypothesis: It focuses on the process of distributing your solution to your customers. Can they get it easily? How will they buy the product?
2. Testing Your Hypothesis: Make sure your hypothesis can be subjected to testing before testing them. Here, you are seeking validation of your hypothesis. You will want to start speaking to those around you; your network, friends, family, potential investors, those within your target market. They are likely to be your potential customers.
This will give you a better understanding of your customers and market. You will also recognize your competitors and how they are currently serving your potential customers. You will know the market trends in your industry.
3. Testing Your Product: This comes after gaining deep knowledge about your customers and their problems. You will want to engage your potential customers to know how relevant your solution is to them.
At this stage, you may realize that your product is not suitable for your target market hence, the product is subjected to changes. Either you start again or you make few changes. Then, repeat the process till you get the desired result.
4. Evaluating Your Hypothesis and Proceeding: Evaluate all the collected data during the testing stages by comparing them and drawing conclusions. This will either make you proceed to the customer validation process or start over again.
Evaluating the data will help you identify:
- The problem customers face
- The product
- The business model for your product. The sales process, price delivery, service requirements, and so on.
After going through these stages of customer discovery, you will have enough information to create these documents:
- Sales Revenue Plan
- Business Plan
- Product Plan
- Product Requirement.
