Customer Feedback, the Secret to the Big MO
IBD is accepting nominations for the Momentum conference which is going to be a showcase for companies that are showing real growth in the marketplace. It will be interesting to see the variety of companies that present, but even more interesting to see the common themes that emerge. It got me thinking what is momentum after all? In the world of technology start-ups I would argue that it is all about repeatability, predictability, and extensibility.
To gain momentum you need to be able to build on success, step by step. Whether it’s finding a repeatable sales model in a particular vertical or establishing a consistent release cycle for products, repeatability is the cornerstone of growth. Repeatability leads to a predictable business which in turns simplifies planning and a gives a higher likelihood of attaining momentum and continuous growth. Stable, predictable growth establishes a platform from which to expand the business by extending to adjacent markets.
The real question is how to get started on the path to the big Mo. Generating early momentum is often critical to the ultimate outcome. Take that to heart in the early stages of the company and it will serve you well. Your first entry into the market will set the pattern for months if not years to come. Focus on a product and sales process that is repeatable and you are closer to gaining momentum.
In my experience most companies falter early because they fail one simple task; talking to customers. This is a simple concept, but in the heat of battle gets forgotten especially when you are an early stage company that has an exciting product vision and has just raised seed capital. You have deadlines to meet and shareholders to please.
The typical response is to put your head down, focus on development in the hope of meeting self imposed deadlines – but did you validate the market requirements???? I have never seen a company fail because they got too much market validation – too frequently companies fail because they didn’t get adequate feedback from real customers.
Too little market validation winds up with the company having more enthusiasm about the product or service than the customer – a sure recipe for failure. You wind up with an endless cycle of reworking the product based on user feedback that you should have got earlier. To say the least, this is expensive and avoidable. Think instead of talking to customers early and often – this is critical even before you even start to develop the product.
Consider your potential customers; How can you segment them in a way to identify features and marketing techniques? What are the potential channels for distribution? Talk to your customer prospect. Face to face meeting, focus groups, web surveys; use your creativity and get out in touch with your prospects.
Sample each potential demographic and distribution channel so that you can have enough feedback to confidently draw conclusions and make plans. Don’t assume that you need to show a finished or nearly finished product. For web based products HTML mock ups work well, for software and physical products, paper prototypes and PowerPoint are more than sufficient. Don’t invest too much time and energy until you have determined you have a product or service that will generate sufficient demand to justify full scale development.
Take this approach and you will learn if people will buy your product or as importantly - why not? This feedback will help you modify your product or service to gain faster market acceptance. Doing this before releasing the product will shorten the sales cycle time saving time, money and frustration.
Early feedback from different market segments will tell you which verticals are likely to respond to your product sooner and the marketing messages to which they are likely to respond. This information provides critical feedback to your marketing plan and will shorten the time to a repeatable sales process – critical to generating early momentum. You can also use some of this early information later to prioritize and target future adjacent markets that will extend your business and continue the momentum. A topic I’ll cover in a future post.
Generating momentum requires repeatability and predictably; getting real customers with real revenue. Remember it starts with your first customer. Talk to prospects up front and you will be on your way to the big MO!.