How to Iterate Product Value to Reach Product/Market Fit In B2B

“The first prototype isn’t meant to show a solution. It’s to show that you don’t yet understand the problem.” Clay Shirky, Author

Silicon Valley Group founder and product management expert Marty Cagan says that there are two inconvenient truths in products:

  • At least half of your product ideas are not going to work.
  • It typically takes several iterations to get the implementation of the product to the point where it delivers the expected business value.

In other words, despite all the research you do, it’s almost guaranteed that the first version of your product won’t completely meet the needs of your early customers.

With many stakeholders to satisfy, you’ll need to do a lot of work to capture the needs and expectations of the entire buying team, and to address their requirements.

Value Delivered VS Expectations
Value Delivered VS Expectations

The good thing is that because the product delivered was a minimum viable product, you’ll be able to change and adapt more quickly. Moving forward, there might be many changes required just to align the value proposition and benefits sold to the actual value delivered.

To make progress at this point you need to clarify the gaps in expectations with the buying team. Does your product deliver the expected value? What gaps do the stakeholders perceive?

Staying the Course

“It’s about being very focused on the problem you’re solving, your exact target personas, your total addressable market, your beachhead market, and then executing on that.” – Scott Barrington, Modlar Founder & CEO

This phase is a startup graveyard.

As your role switches from research to product delivery, it can be easy for your mindset to switch as well. But, to keep making progress and reach product/market fit, it’s critical to stay committed.

We know what value was sold to businesses, and what metrics the early product is expected to move. What remains is figuring out the best way to deliver those outcomes.

The product you end up with may be completely different from what was delivered thus far.

To make progress, you need to stay flexible in the way the product delivers the outcomes, while also remaining single-mindedly focused on delivering the expected product value.

Don’t try to optimize. Don’t fall in love with your product. Your goal is to find the best way to deliver the value, and then iterate until that value becomes reality.

Assessing the Product Value Delivered

“The most important thing is to establish compelling value. It’s all hard, but the hardest part of all is creating the necessary value so that customers ultimately choose to buy or to use. We can survive for a while with usability issues or performance issues, but without the core value, we really have nothing.” – Marty Cagan

How wide is the gap? Does this thing that you built actually address the needs? How far are you still from delivering the desired outcomes?

At this stage, you need to consider two types of product value:

  • The outcome(s): the metrics that you agreed that your solution would influence
  • The perception of value: the perceived impact of your solution

Your product may be doing its part—moving the metric—but if the buying team doesn’t feel that it’s driving the right outcomes, they’ll disengage.

To win, you need to stay close to your customers, and prioritize improvements that are in line with the two types of value. Any changes that you make need to deliver outcomes and be perceived as meaningful improvements.

This starts by understanding the value gap—the discrepancy between what customers expect and the value they’re actually getting.

To learn about this gap and the value delivered, sit down with users. Observe how they use the product to accomplish the Job. As they make use of the product, try to understand how well it matches their expectations by asking:

  • Was that what you were expecting?
  • What problem(s) do you feel [ Product ] addresses?
  • How does it compare to [ Competing Solution ]?
  • Can you walk me through how you’re currently using [ Product ] to perform [ Job to be Done ]?

Use open-ended questions to capture gaps and bottlenecks:

  • What’s preventing you from [ Specific Job Step ]?
  • What do you feel are the main limitations of [ Product ]?
  • Have you found ways to get more [ Outcome ]?
  • How well do you feel the product solves [ Problem ]?

Gaps are what prevents a company from realizing or perceiving the value. These are what you want to be iterating on, first.

Aligning the Product Value to Customer Expectations
Aligning the Product Value to Customer Expectations

Taking in More Perspectives

“Clients will feel they have a relationship with you only when they believe that you understand their needs, their situation, their vision, their constraints, their corporate goals and their career goals.” Ken Morse

You have your feet in the door of organizations. Now is your opportunity to start learning about the other stakeholders involved—their needs, how they buy, how they evaluate the product value, and where they look for new solutions.

If your customers asked you to create accounts for many stakeholders in their organizations, they may have already mapped the key stakeholders for you. Thoroughly research their roles and profiles.

If you’re not clear about which stakeholders will use your product—or won’t be using the product—you can ask your buyer or change agent to help you identify the stakeholders.

Consider asking:

  • Who typically gets involved? At what points of [ Job to be Done ]?
  • How many people are affected by the [ Job to be Done / Problem ]?
  • Who would you say is most affected by [ Problem ]?
  • How does your team select which products or solutions it uses to support [ Job to be Done ]?
  • Who ultimately is responsible for [ Job to be Done ]?
  • Who else in the company should we be speaking with regard to [ Job to be Done ]?
  • How does the company typically purchase new solutions?
  • Is there a reason why your team hasn’t [ hired an external consultant / purchased a solution ] to address [ Job to be Done / Problem ]?

If the organization is more informal, simply organize interviews with other stakeholders to learn about their perspectives. If there are important stakeholders who might be difficult to reach or speak to, consider asking your change agent for introductions.

When speaking with the stakeholders, try to gauge their involvement, understand the outcomes they seek, and get a sense of their perspectives and challenges involved with adopting your solution.

Consider asking questions like:

  • How would you describe your role as [ Role ]?
  • What does success look like for you?
  • How did you first hear about [ Product ]? What did you know about it at the time?
  • What was going on in the organization at that time?
  • What were you expecting from the product?
  • What was your previous experience with [ Solution Space ]?
  • Why was it important to address [ Problem / Opportunity ]?
  • Did anything make you hesitate? Did you have any objections?
  • Now that you have [ Product ] what can you do that you couldn’t do before? What can your team do that it couldn’t before?
  • What is the main value that you feel the organization receives from the product?
  • What is the main problem that you feel the product solves for you?
  • What does success look like when using [ Product ]?
  • How does [ Product ] work with the other related products or services that are currently in use in the organization?
  • What’s not happening that you want to see happen?
  • What was your greatest concern about getting rid of the old [ Product / Service ]?
  • What was your greatest concern about putting something new in place?

You probably won’t have a lot of time with decision-makers, so make sure you always know which core questions you need answers to. If time is particularly limited, consider using different questions for different stakeholders. That way you’ll get a more complete picture.

Interviewing stakeholders across different customer accounts will help to round out your understanding. It might reveal other related problems or opportunities that could eventually be addressed, or identify problems and gaps that need to be overcome.

As Bain & Company customer strategy experts Eric Almquist, Jamie Cleghorn, and Lori Sherer explain: “Recognizing the full range of both rational and emotional factors behind business purchases—and tailoring the value proposition accordingly—is critical to avoiding the commodity trap.”

Consolidate the data customer by customer using a Buyer Map. Before you make any changes, however, confirm what you have learned.

Confirming Your Learnings

“People are trained not to call your baby ugly. You need to make them feel safe to do this. Ask them up-front to be brutally honest, and explain that it is the very best way for them to help you.” Giff Constable

There’s often a gap between what people say and what they do—and between what people are supposed to do and what they actually do. Reality generally sits somewhere in the middle.

To gain clarity and make sure that you’re building on solid ground, it’s a good idea to triangulate your learnings, by comparing what customers have said with how they actually behave.

Depending on your level of access to customers, you may be able to:

  • Compare what they said with what they actually did with the product: By using activity streams (also known as user activity logs), analytics platforms, or visitor recordings you might be able to analyze behaviors user by user. If you focus on core feature usage and retention you can validate whether users are actually doing what they say they are. This can also help with discovering friction points. Look at the sequence of their actions: How far do they get inside the product? Do they perform the core actions? Are they experiencing the core product value? Do they get blocked? Do they come back on their own? Are there things that they do that you don’t understand? How well does the frequency of their engagement map to the natural cadence of the Job that they’re performing?
  • Evaluate how their use maps to their work or the Job to be Done: If you can spend time at customer sites, or do in-depth interviews, you might be able to understand how the product fits in their work, and how it matches the Job process. This could help you understand what’s not being said. Field studies are a bit like unscripted user tests, during which you observe people in their natural environments. Let users go through their regular tasks and processes while lightly probing them about their workflows, reasoning, and the challenges they are facing. Where are they struggling the most to get the Job done? Why are they getting off track? Are there steps that could be eliminated? How could the product get more of the Job done for them? What are they doing three minutes before and three minutes after performing the Job?

Focus on delivering the core experience with the minimum feature set.

Steer clear of wants, wishes, and ideas that don’t relate to the core Job, or ways to deliver the desired outcomes. The more bells and whistles and features that you commit to building, the less time you’ll have to invest in iterating your wedge, or creating a true 10x solution.

Don’t try to create a rounded experience, or to optimize your product before product/market fit. All your energy must go towards delivering the core value and gaining adoption inside the target organizations. This might mean being ruthless with prioritization. Don’t flinch.

Iterating Product Value to Product/Market Fit

“Fast evolving products with great customer support convey to users that the startup cares about delighting them.”Tomasz Tunguz, Redpoint Ventures Managing Director

Too often, when founders launch their products and they don’t get the results they were hoping for, they add features.

Then, when they realize that the new features don’t improve retention, they add more features.

At that point, they’ve entered what Testing Business Ideas author David J. Bland calls the Product Death Cycle:

Early on, adding features or making drastic changes is the last thing you should do. There are good reasons why you built what you built. It’s important to invalidate those hypotheses before thinking about expanding.

Adding features makes it more difficult for new users to experience the core value of the product.

Speak to users. Come up with hypotheses about what will improve the fit of your solution with your target customers. Make small changes, evaluate their impact on customers—and start again.

Keep iterating until you have clear indications that your product is useful, and it has begun to exceed customer expectations.

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