Customers Before Product

Following up on my last post on Solutions in Search of a Problem, today’s post is about the best way to avoid that trap: engaging your prospective customers *before* developing your product.

Too many first-time entrepreneurs are unable or unwilling to sell their vision without an actual product to back it up. As a result, they go heads-down on a development effort that isn’t grounded in real customer problems. When they come up for air, they may have something to sell, but it’s likely not what their customers actually need, and they’ve burned precious money and time in the process.

If you’re uncomfortable with the idea of “selling air”, reframe the effort as customer research. Give away some component of your planned value proposition for free, offer to share your research findings with participants, or come up with some other creative solution to deliver value to these early “customers” in exchange for their feedback on your idea.

Cooler Planet did this in the early days, offering free customer referrals to their early signups in exchange for information and feedback. Of the 30+ participants in this “research” effort, more than 50% ultimately signed on as paying customers. And nearly every participant gave them information that helped the company zero in on a differentiated value proposition, appropriate pricing and a process model that allowed them to scale revenue quickly once they were ready.

Another great story along these lines comes from Greg Gianforte, founder of of RightNow Technologies and co-founder of TechRanch, a non-profit that helps Montana entrepreneurs get up and running. Here are a few choice quotes from a recent interview:

I was on the phone making hundreds of calls to find out what companies would buy before I ever wrote a line of code“, and

You need to be the first one to sell your own product, because if you can’t sell it nobody else can.”

The moral of the story is: Don’t be afraid to ask for the sale, even if you don’t have anything to sell just yet.