When is the last time you performed a systematic customer research and segmentation exercise on your business?
I stumbled upon an interesting, and somewhat alarming, observation earlier this year following a CMO peer group discussion in Boston during which we were discussing each of our company's positioning and how we determined the approach.
After hearing exec after exec describe a similar process I picked up on a remarkably common theme: we all did this when we first joined a company.
But markets don’t stand still, nor do customers, nor do product/platform capabilities or their fit with the market. As a group, we all appeared to do really critical thinking when we first joined a company, but not one person ever described going back and re-challenging assumptions the way we all did on day-1.
It seems simple to say now, but so few people seem willing or able to truly step back and assess critically once their boat leaves the dock. Markets and product/market fit are constantly evolving and so should we.
So I signed myself up to a stretch goal: step away from all but the most critical tasks for several weeks in order to attempt to interview every single one of our customers. I was determined to interview customers and partners the way I had done two years prior.
How did customers find us? What pains we were solving? How were they using our product? How did they describe the benefits that we were providing? When we didn’t close a deal did we really understand why? What other challenges around our industry were they facing and how might we apply our product to address them?
This stuff is obviously easier to do as a new hire because your perspective is perfectly fresh and you’re genuinely listening. Not to mention that you’re probably not yet getting 100+ emails a day and getting pulled into meetings left and right.
Committed to a real and fresh look, I partnered with our head of Product and invited everyone on the marketing team to listen in on the calls we conducted. I personally emailed and called project sponsors and system administrators. We also sent broader emails to everyone in our customer database. I began speaking with any human in our accounts that was willing to spend a few minutes with me. In the end I managed to speak with someone at nearly 70% of our installed base.
We much better understood our winning conditions and specifically why we were chosen or renewed (we’re a SaaS business) over competing approaches. Customers and partners were grouped according to several new and existing factors and a different view of our market segmentation emerged.
This newfound clarity indicated that our product/market fit was strongest in a narrower slice of the market than we originally believed. While sometimes disappointing to be pursuing a smaller total available market, precision of audience and go-to-market tactics for a growing company is indispensable.
Our overhauled messaging platform drove re-writes of major portions of our website, sales tools, and marketing programs. Time on site and website conversion metrics started to improve almost immediately. Lead-flow waterfall metrics have also been improving and we’re starting to see the early leads close from this effort. After reinforcing this use-case with industry analysts we also saw an increased number of customer referrals/sales leads from the analysts themselves.
Perhaps more surprisingly, we uncovered a brand new customer segment; a use for our product that we hadn’t fully understood or appreciated before this effort. After validating the hypothesis with several fresh prospects, we launched a brand new product offering that has become a reliable offer with which to “land” in a brand new account before “expanding” with our broader enterprise offering.
How do YOU know when it's time to challenge your core assumptions?
(this article was originally posted on VentureBeat.)
I stumbled upon an interesting, and somewhat alarming, observation earlier this year following a CMO peer group discussion in Boston during which we were discussing each of our company's positioning and how we determined the approach.
Do You Set It and Forget It?
In the discussion there was a universal theme: every CMO talked about performing thorough customer, partner, and employee interviews when they joined their company and using that feedback to drive positioning and messaging decisions. It’s a great move and helps one to segment the audience and develop messages and tactics suitable for the targeted market. I’ve done this for years and find it a vital exercise coming into a new company as a leader.After hearing exec after exec describe a similar process I picked up on a remarkably common theme: we all did this when we first joined a company.
But markets don’t stand still, nor do customers, nor do product/platform capabilities or their fit with the market. As a group, we all appeared to do really critical thinking when we first joined a company, but not one person ever described going back and re-challenging assumptions the way we all did on day-1.
Is it Time to Move?
A relatively simply question began to form in my head: if I joined my company today as a new hire, how would I freshly look at the business and would I arrive at the same segmentation, positioning strategy and messaging platform?It seems simple to say now, but so few people seem willing or able to truly step back and assess critically once their boat leaves the dock. Markets and product/market fit are constantly evolving and so should we.
So I signed myself up to a stretch goal: step away from all but the most critical tasks for several weeks in order to attempt to interview every single one of our customers. I was determined to interview customers and partners the way I had done two years prior.
Hit It Like You’re a New Hire!
Remember how excited you were when you first joined your current venture? You probably interviewed any customer or partner or team member who would make eye contact or take your call. You probably asked what now seems like basic questions and your eyes were wide open for insights that would help you nail the perfect way to pitch your product.
How did customers find us? What pains we were solving? How were they using our product? How did they describe the benefits that we were providing? When we didn’t close a deal did we really understand why? What other challenges around our industry were they facing and how might we apply our product to address them?
This stuff is obviously easier to do as a new hire because your perspective is perfectly fresh and you’re genuinely listening. Not to mention that you’re probably not yet getting 100+ emails a day and getting pulled into meetings left and right.
Committed to a real and fresh look, I partnered with our head of Product and invited everyone on the marketing team to listen in on the calls we conducted. I personally emailed and called project sponsors and system administrators. We also sent broader emails to everyone in our customer database. I began speaking with any human in our accounts that was willing to spend a few minutes with me. In the end I managed to speak with someone at nearly 70% of our installed base.
Gold in the Base
We amassed an awesome number of findings from our installed base that led to a few notable changes for our business.We much better understood our winning conditions and specifically why we were chosen or renewed (we’re a SaaS business) over competing approaches. Customers and partners were grouped according to several new and existing factors and a different view of our market segmentation emerged.
This newfound clarity indicated that our product/market fit was strongest in a narrower slice of the market than we originally believed. While sometimes disappointing to be pursuing a smaller total available market, precision of audience and go-to-market tactics for a growing company is indispensable.
Our overhauled messaging platform drove re-writes of major portions of our website, sales tools, and marketing programs. Time on site and website conversion metrics started to improve almost immediately. Lead-flow waterfall metrics have also been improving and we’re starting to see the early leads close from this effort. After reinforcing this use-case with industry analysts we also saw an increased number of customer referrals/sales leads from the analysts themselves.
Perhaps more surprisingly, we uncovered a brand new customer segment; a use for our product that we hadn’t fully understood or appreciated before this effort. After validating the hypothesis with several fresh prospects, we launched a brand new product offering that has become a reliable offer with which to “land” in a brand new account before “expanding” with our broader enterprise offering.
Operationalize this Kind of Learning
As mentioned above, markets don’t stand still. Doing this kind of “resegmentation” research was a lot of work and not something you can or need to perform monthly. But there are some great ways to keep yourself and your team attached to the customer and market.- Listen in on in-bound or out-bound BDR calls. Every single person (including me) in my marketing organization now shares a common MBO of listening in on six BDR calls every quarter. Team members share their insights during team meetings as a way to help them internalize what they’re learning and to bring others along.
- Do industry analyst inquiries. Too many marketing groups see analysts as needing to be sold. Pitching your innovations and customer wins is part of your mission, however I’ve come to appreciate industry analysts as being excellent sources of information about your target audience and competitors. Do yourself a huge favor and turn more of your analyst meetings into listening meetings when you ask them questions about the market and unmet customer needs. Do more listening than selling.
- Attend a conference in your industry as an attendee. It’s hard to listen when you’re pitching. Try to get to a few conferences in your industry and attend as an attendee. Go to sessions, participate, and network. Listen carefully to the questions your audience is asking.
- Perform some win-loss reports by yourself. For some reason win-loss reports are often inconsistently performed. And when they are, a marketing manager or product manager often performs them and then emails the reports. Try doing a few of these interviews personally. The 1:1 time with a customer or lost prospect should yield some great, raw feedback and it’s hard to replace the texture you’ll get by doing this yourself
Resegment or Reconfirm
There is only upside from this kind of work. You’ll either confirm that you’re in the right place or you’ll uncover important changes that are worth making to your segmentation and go-to-market approach or perhaps event stumble upon new use-cases.How do YOU know when it's time to challenge your core assumptions?
(this article was originally posted on VentureBeat.)