Customer discovery puts you at the heart of your user’s needs 

As a business, your primary function is to make your customers’ lives easier. That’s it! And yet something that sounds so simple on paper is often a lot more difficult in the real world. 

Consider this: an eye-watering 95% of new products fail. And Google, one of the world’s biggest, most successful companies, invented a massive flop. As Walmart founder Sam Walton once said — “There is only one boss. The customer. And [they] can fire everybody in the company from the chairman on down, simply by spending [their] money somewhere else.”

So what’s the secret to getting it right?

No, it’s not a crystal ball or a lucky rabbit’s foot. Nor is it a giant R&D department. It’s customer discovery — the process of understanding and uncovering your customers’ expectations, preferences, wants, and needs.

Let’s cover customer discovery, why it’s essential, and how to do it efficiently and effectively.

What is customer discovery?

Customer discovery is the process of finding out who your customers are. This includes understanding their problems and needs and creating a solution that solves those things.

As a process, it involves gathering feedback from customers to validate product ideas, build better products and services, and ultimately drive business success. It’s a critical part of any successful customer development project and should occur early in the process.

By understanding these key elements of customer discovery, you can make insight-driven choices that help create products or services that resonate with your users. And as a business, that’s pretty much the sole aim of the game!

Here are some of the critical questions customer discovery seeks to answer:

• Who are my customers?
• What do they want?
• How do they use my product/service?
• What can I do to make it better?
• What new features should I add?
• Do customers have any unresolved issues or problems that need solving?
• What channels should I use?
• What pricing strategy will work best?
• How can I grow my customer base?
• Who are the stakeholders?
• What resources will I need?
• What launch and promotional strategies should I use?
• What will be the overall cost?

Why does the customer discovery process matter?

Imagine buying a gift for someone you’ve never met: where would you begin? You might ask what they like, what they need, and how much you should spend.

Building a product or service without understanding your customer’s needs is the same. 

You could build something it turns out nobody wants and waste countless hours, money, and resources in the process. Customer discovery helps you avoid this scenario by giving insight into what people need from your product or service.

It also helps you create a competitive advantage by helping you understand users better than your competitors. When everyone else is achieving ‘close,’ get one step ahead by reaching ‘just right.’ 

What happens if you skip customer discovery?

Remember our stat back there about 95% of new businesses failing?

Unfortunately, skipping customer discovery is a common reason for startup failure.

When you launch without performing customer discovery, you’re relying on your assumptions about what customers want and need — which might be very different from reality. It’s like playing Russian roulette with your business; you might get lucky, but sooner or later, disaster will catch up with you.

Skipping customer discovery also means that your product isn’t likely to meet customers’ needs, and if it doesn’t solve a problem for them, they won’t buy it. On top of this, you’re likely to miss out on potential revenue opportunities if you don’t understand the market.

So, if you want to build a successful product or service that customers will love and use, customer discovery is an essential part of the process. It’s worth taking the time to do it right!

How to master the customer discovery process: four steps to success

The customer discovery process comprises four key stages, but since testing and development are iterative, you may need to hop backward and forwards between each. 

Here are the four key stages: 

1. Develop a hypothesis
2. Test your hypothesis 
3. Test your assumptions 
4. Apply feedback and next steps

Let’s take a closer look at each of these.

1. Develop a hypothesis

Come up with an idea for your product. It’s the first step in understanding what your customers want and need, so keep it as focused as possible.

Here’s an easy way to set it out:

My [product/service] solves [customer problem] by [solution].

Remember to make this as specific as possible. For example, “My online course solves the problem of poor diet by teaching working parents to make quick, healthy dinners for their kids” is more focused than “I want to build an online course about healthy cooking.”

The first option tells you some important things to aim for — those being to target time-poor households, to make the course quick and accessible, and to focus on dinner options specifically. The second option is too broad and doesn’t give you a clear direction.

As well as developing an overarching hypothesis, consider creating different statements for different stages of your customer discovery journey. 

Here are some examples:

• Problem hypothesis: “I think full-time workers need help to make healthier meals for their families.” 
• Solution hypothesis: “People with busy lifestyles want simple, easily accessible recipes that use minimal ingredients.”
• Price hypothesis: “People are willing to pay a monthly subscription fee of $7.95 for access to healthy meal plans”.
• Go-to-market hypothesis: “The best way to reach our target audience is through Facebook ads.”

These statements will help to focus your customer discovery process and ensure you get the most out of it.

2. Test your hypothesis  

Once you have a list of hypotheses to test, it’s time to get out there, meet your audience, and learn about what they want. You’ll also want to return to this stage once you have a product (including an MVP or prototype) to test. 

When it comes to finding out about your users, surveys, focus groups, and interviews are all good options here — as is delving into the wealth of data afforded by Google Analytics. The goal is to get feedback from people in your target market and understand what they need and how they would use your product.

It’s also important to remember that different types of feedback are useful at different stages in the development process. 

For example, you may find surveys are more useful to begin with, as they’ll give you a better idea of what people want and need — whereas focus groups are a great way to get people’s detailed, in-depth thoughts and feedback after the product is built.

To do this stage effectively, ask open-ended questions that encourage your audience to tell you about their needs rather than you forcing your assumptions on them and getting them to agree. Let them do the work! 

Here are some questions to consider:

• Tell me about how you do x activity.
• Do you ever struggle with x?
• When it comes to doing x, what are your biggest challenges? 
• What would make the process easier for you?
• What do you like/dislike about x?
• If there were one thing that could make x easier for you, what would it be?
• What do you think of x product/service?
• What would you pay for x?
• How would you like to access x?
• Is there an alternative to using x?

“Always begin with: ‘So that I can better serve you, do you mind if I ask a few questions?'”

— Jodie Shaw, Chief Marketing Officer at The Alternative Board.

If your interviewee has lots to say on the matter, then it’s a sure sign there’s a need for your product. If not, it might be time to reconsider or try a fresh angle. And remember — don’t lose hope if you don’t get much interest. Your idea may not be a hit, but it’s better to find out now than later.

3. Test your assumptions 

Test whether the assumptions that formed the backbone of your hypothesis are accurate. 

This stage is important because it helps determine whether your idea makes business sense. After all, even a positive hypothesis isn’t a sure sign you should go ahead; just because a few people like the idea of your product, it doesn’t mean there’s a market for it. These questions will add another layer of security to your decision. 

Here are some test questions: 

• Is the problem I’ve defined really a problem? How can I prove it using the data I’ve collected so far?
• Does my solution solve the problem? Are there other options out there?
• Is there a big enough audience for this solution?
• Will my target audience be willing to pay to have this problem alleviated?

hift the focus from what went wrong to how you can help make it right.”

— Rachel Hogue, Customer experience expert.

Testing assumptions and discovering you are right also has the added benefit of validating your idea and giving you the confidence to move forward, not to mention helping you create a strong business case attractive to investors. 

Whenever you test assumptions, put yourself in Sherlock Holmes’ shoes (or hat): what is your evidence for thinking this? If there isn’t any, go back and speak to more customers, or return to the drawing board. 

4. Apply feedback and next steps

So you’ve proved your hypothesis and assumptions are correct. Now it’s time to apply your findings to the product. This is an iterative process; it’s essential to keep testing, refining, and evaluating until you have a product that meets your customers’ needs. 

Remember that customer discovery isn’t just about getting feedback — it’s also about understanding what the customer wants from your product or service, how they’ll use it, and what their expectations are — as well as what you can deliver in-line with your resources. You can’t say ‘yes’ to every customer request, but with careful consideration, you can work out which will keep the most people happy and give you the best ROI. 

Top tip: use a Minimum Viable Product or prototyping during the testing phase. Both allow you to get feedback on your product while it’s still in development, allowing you to iterate and improve quickly.

Which customer discovery methods should you use?

It depends on your specific product and target audience. However, common methods include surveys, interviews, focus groups, observation studies, beta testing, video testing, and usability tests.

Here’s what each of these means and the pros and cons of each:

Surveys: These are great for collecting feedback from large groups of people, but they don’t allow you to ask follow-up questions or dig deeper into their responses. They’re best used at the start of the process. And don’t forget to visualize all that data! It makes it way easier to understand. 

Interviews: Interviews are ideal for getting in-depth information from specific individuals. However, they are time-consuming and may not be practical if you have many potential customers to get feedback from. Ideally, keep it for when you’re in the middle and later stages. 

Focus groups: Focus groups let you talk to several people at once and collect group insights into the ideas and needs of your target audience. They can be expensive and require more organization than surveys or interviews.

Observation studies: Observation studies involve observing how people use or interact with products or services. They give valuable insights into your customer’s behavior but are often expensive and difficult to implement. Keep this for the MVP/prototyping stages or an existing product you’d like to improve. 

Beta testing: Beta testing is a great way to get feedback from real users on how they use a new version of your product and what features they like or don’t like. It requires extra resources for development and support, so it’s not for everyone.

Video testing: Video testing lets you observe how people use a product in the comfort of their own homes, giving you invaluable data about how customers interact with it. It’s time-consuming, so it may not be practical if you’re working with a small budget. You can also use this for focus groups and interviews.

Usability tests: Usability tests help evaluate the usability of a product by determining how easy it is to use. Usually, you observe a user interacting with the product and collect feedback in real-time. It’s ideal for improving the end-user experience, but again can be costly to implement on a large scale. 

Mastering the customer discovery journey: tips and best practice

No matter which customer discovery process you use, there are a few key tips to keep in mind.

1. Keep it simple — don’t overwhelm your customers with too much information or questions.
2. Take notes — make sure you take detailed notes of what each customer says so you can refer back to them later for further insights. 
3. Be flexible — be prepared to change direction at any time. Customer feedback should always inform your product roadmap.
4. Set measurable objectives — have clearly defined goals and expectations for each stage of the journey so that you know when it’s time to move on.
5. Talk to the right people — ideally, talk to those who match your target customer profile and use your product.
6. Analyze feedback — dig into the insights you get from customer discovery and use them to inform your product design and marketing strategies.
7. Be patient — a successful customer discovery process takes time, so don’t rush it!
8. Test every assumption and hypothesis — Don’t take anything for granted! Test every assumption and hypothesis about your customer to ensure you have the correct information.
9. Collect feedback from multiple sources — To get a comprehensive view of your customers, collect feedback from a range of people in various ways. This includes customer surveys, interviews, focus groups, and even competitors.
10. Create an MVP — Once you’ve collected enough data, create a minimum viable product (MVP) or prototype and test it with real customers. For websites, wireframing is the gold standard — and don’t forget to use an online diagramming tool to make the creation and editing stage both easy and collaborative. Speaking of tools…
11. Use tools to collect data — Invest in customer discovery tools such as survey software and analytics apps to collect, analyze and store customer information. It’s worth remembering that the customer discovery process is an iterative one — you may have to go back and forth a few times to get the insights you need, so using diagramming and project management tools will save you a lot of trouble.

Ultimately, mastering the customer discovery process is essential for developing successful products that customers love. With careful planning, research, testing, and analysis, you can ensure that your product meets the needs of its intended users every step of the way.