Pm Methodology
|Conducting customer interviews | The key for PMs to better products
Go out to the customer!
A practical report by Shilu Mistry, Design Thinking expert
80% of products that come onto the market fail because they do not fulfil customer needs. That’s millions in lost revenue and ‘sunk’ R&D costs for a company. And perhaps a career killer for product managers. On the other hand, companies and product managers that have invested in customer-centric methods and truly understand customer needs outperform other companies in their industry by over 200%.
Reinvention through real customer insights
The basis for a good product-market fit is and remains an understanding of customers, their challenges, pains and gains, and the resulting benefit expectations. Finding this out is the core task of product management. To do this, product managers should leave their familiar physical and mental environment. And go to where the answers can be found: To the customer!
Companies like John Deer, Philips and Netflix are constantly reinventing their products and leading the market by understanding and solving customer problems and addressing their unmet needs. How do they do this? One way is by reaching out to customers through interviews and research to give them deeper insights so they can make more informed product decisions. However, this is not a one-time investment, but rather a commitment to continuous customer feedback throughout the product development cycle, making constant adjustments before the product is launched. This helps to reduce the risk of failure and move closer to true product-market fit.
Netflix is a great example of how understanding customer behaviour and customer problems has helped them reinvent their product and the reason for their success. The company, which started in 1998 as a competitor to Blockbuster, reinvented their product over and over again. They started by tackling the physical shop problem by offering online and mail order DVD rental. They solved payment problems with a flat monthly fee. They eliminated the physical handling of DVDs via streaming. And solved the lack of engaging entertainment by producing their own award-winning films and series.
My path from customer survey to marketable product
As a product manager and business innovator, I’m always looking for the right insights to create product breakthroughs and explore how companies like Netflix are ‘disrupting’ industries. In the past, however, I had focussed exclusively on small incremental changes to my product. I was convinced and stuck to my ideas, relying heavily on market reports, internal sales and customer analyses. I gathered input from a small group of KOLs who did not represent the market majority. And met with customers once or twice a year on site visits or at trade shows, mainly supporting sales in generating leads.
When I started working in an innovation lab for a large medical device company that focused on human-centred approaches, I learned three very important lessons to build a better product:
Lesson 1: ‘Kill your darling’
I realised that my own bias towards my product and ideas was preventing me from having an open mind. I had to let go of that bias and take criticism from others such as designers, engineers, sales, marketing and service managers and most importantly customers to rethink, iterate and reinvent.
Lesson 2: Go out to the customers
The most important insights do not come from your office. You have to go to your customers. Listen and empathise. Observe their environment to see how they work, who they interact with, what challenges they face and how they use the product. Even online tools can be used to conduct interviews and observe the physical environment. Walking in your customers’ shoes will give you far more insight than any online survey alone.
Lesson 3: Accepting problems
Every problem is an opportunity to make improvements. As product managers, we shy away from problems, not to mention the fact that our products don’t really work for our customers. We tend to defend our decisions and convince customers that it’s the right solution. Once I started to really recognise my customers’ problems, I was able to focus clearly on the extent to which my product was addressing those problems, or more importantly, which problems were not being solved. I was then able to think about whether my product could be improved or whether another solution would be more effective.
Put the boring questionnaire aside!
Prepare yourself well instead!
But how exactly do you gather the necessary insights from customers to support product decisions? Good preparation is just as important, if not more important, than conducting customer interviews. And conducting good interviews means putting aside the boring questionnaires and immersing yourself in the world of your customers instead.
How did we start? Very traditionally with business analysis. We analysed our value propositions, our profit potential, conducted SWOT and competitive analyses and outlined our key strategic objectives. Customer surveys were used to complement, not replace, traditional business analyses and methods.
Once we knew our strategic focus, we began to consider which customers we should survey. When considering our customer segments, we differentiated between heavy users (or KOLs), moderate users, light users and even competitive users. We identified key decision makers such as chief medical officers, other users such as office-based physicians, nurses, researchers, and influencers such as business and office managers. We then tried to differentiate based on behaviours, such as customers who were more focused on research than efficiency or career. All these facets gave us a broader spectrum to focus on different problems and needs.
When conducting interviews, we did not follow a predetermined questionnaire or jump straight into product questions, but used the ‘question funnel’. This technique helped us to first understand the customer as a person, what inspired them in their career, what goals they wanted to achieve, what motivated them to do their job. Then we looked at how they did their work, what they needed for their work and what pain points they faced in their work. We then brainstormed possible solutions to their problems. Only at the end did we finally touch on the product and whether it would meet their challenges and needs. We asked where they saw gaps or improvements or what were ‘must-haves’ and what were ‘nice-to-haves’.
100+ new ideas
When we returned from the interviews, we came back with a wealth of insights and new ideas. It wasn’t just a few incremental feature changes, but over 100 new concepts that went beyond the product and helped us think more holistically. In addition to product improvements, customer insights gave us new ideas on how to sell, price, distribute, install, train or maintain the product. From these 100+ ideas, we were able to narrow down, prioritise and implement 4-5 key concepts that made the most sense for our core business, which ultimately allowed us to better engage with customers and improve adoption.
After many years of working with customers and gathering insights, I have learnt that it really is the secret ingredient to making more informed product decisions. Knowing what the customer wants before and during the manufacturing of the product eliminated months of internal discussion, ambiguity and deliberation. It gave us the confidence to build a better product and enter the market knowing that these new ‘solutions’ address our customers’ problems and fulfil market needs.
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