Customer Zoom: Value Stream Discovery and Market Segmentation
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How to discover your market segment and learn to provide value. 7 stages your customer goes through from becoming Aware to Passionate. Create hypotheses and test assumptions.
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Customer Zoom: Value Stream Discovery and Market Segmentation
- 1. value stream discovery and market segmentation Wayra, Lima, Peru March 1st, 2017 @brantcooper @movestheneedle
- 4. customers are more agile than we are…
- 5. our organizational systems and structures are based upon the industrial age
- 7. SEARCHEXECUTE On the known In the unknown Measure tasks Measure impact Continuous Improvement Reinvention
- 8. © Moves the Needle All rights reserved WHAT IS LEAN? LEAN: Reduction of waste in producing known value (Customer, problem, solution known) LEAN STARTUP: Reduction of waste in discovering new value (Customer, problem, solution unknown)
- 9. © Moves the Needle All rights reserved 3 E’s OF LEAN INNOVATION E Understanding our customers deeply; their pains, passions and desires. Developing insights. EMPATHY E Translating insights into action. Reducing risks through assumption testing. EXPERIMENTATION E Making decisions quickly based on insights and actual customer behavior. EVIDENCE
- 10. LEAN INNOVATION IN PRACTICE © Moves the Needle All rights reserved
- 11. © Moves the Needle All rights reserved EMPATHY What are different ways you can gain customer empathy – to experience and understand the world from your customer’s perspective?
- 12. © Moves the Needle All rights reserved EXPERIMENTS “IN THE WILD” experiment examples
- 13. © Moves the Needle All rights reserved GOAL OF EXPERIMENTATION: EVIDENCE (DATA + INSIGHTS) DATA INSIGHTS+ actual results why? why? why? 2/100 tried to give me their credit card we didn’t meet high customer expectations 9/10 provided company email address they saw we could get the job done 20/50 clicked on buy now button we think we discovered our ideal customer
- 14. © Moves the Needle All rights reserved hypothesis If we do X, Y% of people will behave in way Z. X = Business Activity (minimum viable) Y% = Target Metric Z = Customers’ Behavior
- 16. © Moves the Needle All rights reserved FINDING YOUR MARKET • Have the same problem • Speak the same “language” • Hang out together • Situations not demographics
- 17. © Moves the Needle All rights reserved CUSTOMER ZOOM EXAMPLE unique attributes likes urban environments travels for work Kind of a hipster goes to locals hangouts Seeks experiences Reads Lonely Planet books Freddie Castle behaviors zoom What’s his work environment like? Does he use online collaboration tools? Does he use offline tools? How does he look for new tools? Always the guy to setup hangout and slack. How does he cope with the pain? Picture Name Job Title (if applicable)
- 18. © Moves the Needle All rights reserved Has great travel experiences more fulfilled saves $ on vacations Doesn’t know how to find places he trusts Must feel safe Vacation rentals hard to get; don’t fit schedule. quality and comfort great travel experience PROBLEM ZOOM EXAMPLE desired outcomes pains & problems zoom How will solving problem affect the life of customer? Is there a significant time or cost impact? Is there a bigger emotional or aspirational win? What stops the customer from behaving differently now? What obstacles need to be overcome? What are limitations of workaround? We promise “______” We hope the outcome will be “______”
- 19. © Moves the Needle All rights reserved Ability to browse pictures of room Ability to reserve room Ability to get access to room Web Platform Money transaction engine “Market place” technology Pictures of air mattresses in apartment Be able to browse photos and look up hosts on social media. SOLUTION ZOOM EXAMPLE top functionality by what means? zoom What MUST be built to fulfill the promise you’re making to your ideal customer? What backend, technology, platforms, means of distribution must be already in place or put into place to deliver functionality? What do you believe is the minimum you can offer, for which the customer will be willing to pay? What specifically must they do the first time they attempt to achieve value you’re promising?
- 22. AWARE Business activity: • Airbnb: Hack Craigslist vacation rental ads looking for business travelers who want a “locals” travel experience. Customer Behavior • Click on Craigslist ad; browse listing Metric: • Listings browsed by source VALUE STREAM DISCOVERY AWARE
- 24. INTRIGUED Business activities: • AirBNB: Inexpensive rooms. Have “local’s experience.” • “Stay with a local when traveling.” Customer Behavior • Browse FAQ or About Us Metric: • Specific web page by source. (Craigslist) VALUE STREAM INTRIGUED
- 25. © Moves the Needle All rights reserved airbnb A trusted community marketplace for people to list, discover, and book unique accommodations around the world.
- 27. TRUSTING Business activities: • Airbnb: Read article about AirBnB • Read FAQ • Read listing reviews Customer Behavior • Click on Request to Book • Fills out account application • Supplies credit car info Metric: • Fill out application by funnel path. VALUE STREAM TRUSTING
- 29. CONVINCED Business activities: • Airbnb: Safety guarantees • MTN: Proposal Customer Behavior • Reserves room Metric: • Revenue by funnel path. VALUE STREAM DISCOVERY
- 31. HOPEFUL Business activities: • Airbnb: Facilitate (urge) communication between host and guest. Customer Behavior • contacts host (guest) Metric: • Measure communications between host and guest. VALUE STREAM DISCOVERY
- 33. SATISFIED Business activities: • Build MVP: Minimum functionality required to fulfill utility promise. • 1 page web site; air mattresses; fresh towels; breakfast Metric: • Guest stays multiple nights • Customer comes back and rents again • Customer rents 3 night every 6 months VALUE STREAM DISCOVERY
- 35. PASSIONATE Business activities: • Messaging/Branding • Customer has “locals” experience Customer Behavior • Invites friends • Fills out review • Participates in online community • Shares photos on social media Metric: • Viral coefficient VALUE STREAM DISCOVERY
- 37. VALUE STREAM DISCOVERY PASSIONATESATISFIEDHOPEFULCONVINCEDTRUSTINGINTRIGUEDAWARE Innovation • Don’t know what value to create • Don’t know for whom • Don’t know how to execute Hypothesize • Customer Behavior • Business Activity • How to measure
- 38. VALUE STREAM DASHBOARD PASSIONATESATISFIEDHOPEFULCONVINCEDTRUSTINGINTRIGUEDAWARE 150 15 5 3 3 2 1metric behaviorLanding Page Download Req proposal Sign contract Do pre-work Sign up again Referral activity Keynotes Content mktg LinkedIn Webinar Referrals Sales email Sales call Reference Collateral Send proposal Negotiation Onsite visit Kickoff call Pre-work doc High touch Impact bootcamp Accelerator Impact Co-create case study Lead Magnet Tools Case Studies
- 40. ALL THE FISH
- 41. © Moves the Needle All rights reserved CUSTOMER ZOOM EXAMPLE unique attributes likes urban environments travels for work Kind of a hipster goes to locals hangouts Seeks experiences Reads Lonely Planet books Freddie Castle behaviors zoom What’s his work environment like? Does he use online collaboration tools? Does he use offline tools? How does he look for new tools? Always the guy to setup hangout and slack. How does he cope with the pain? Picture Name Job Title (if applicable)