What consumers want – do they even know?

by Eilidh MacDonald

What is the best way to get feedback on your product? We all know what Steve Jobs thinks on this, with his famous BusinessWeek quote, “people don't know what they want until you show it to them.” But was he right? There is definitely mixed reviews on the topic of the most effective customer feedback mechanism. With the internet and mobile device breaking down geographical and time barriers it is much easier to reach your target customer. So with your new tech venture, where do you start in this outreach? Focus groups, one-on-one interviews, usability tests, surveys, website feedback forms, website blogs, smoke tests, etc. For a two main reasons, I think the most effective form of consumer feedback for tech ventures is the minimum-viable-product (MVP) and/or usability testing.

One: Time is money. In Triangulate, Sunil Nagaraj tried to enable dating using data collected from social networks. His premise that people would get better love matches if the information used to match is from a more accurate data baseline seems to make sense. And so Sunil set about building an algorithm to provide this service to consumers – the algorithm took time and money. It was only when that time and money ran out did Sunil realize one other factor that bubbles beneath his original premise, when it comes to dating people are vulnerable. As a result, people are simply not comfortable signing up for dating applications without serious consideration. Since his business model depended on viral network effects, he didn’t have time for this serious consideration after he had already spent so much time and money building the product. So could he have got to this outcome quicker? I think so. By building a minimum-viable-product and asking people to sign up and actually submit his/her facebook profile information could have been very revealing on people’s unwillingness to put him or herself out there. Sunil did use a smoke-test to test hits but he didn’t ask for any personal information. Had he done this, I think people’s vulnerability would have started to show earlier.

Two: You only get one chance. In the Cake Financial case the founder had a great idea in a large, underserved market. He put together a great team of financial backers and savvy advisors, and took part in TechCrunch40. But the first product he took to market, with a big, press-covered launch, wasn’t what the consumer wanted. As in the Triangulate case, a lot of time and money had already been spent. A big pivot was in order. By the second product launch, consumers were confused and it was too late. Steve Carpenter had used focus groups to get a grasp on what consumers wanted, but talk is cheap. Technology has enabled the western world to efficiently use time irrespective of locale, and as a result we have become used to doing everything through touch. Had he taken a MVP to market he would have learned some important lessons on what consumers actually wanted to see or have access to when making financial decisions, or what they are or are not willing to share with friends and family. Spending time on data aggregation rather than the end-consumer was a fatal mistake and one that could have been avoided if he had skipped a few focus groups and headed straight to the MVP stage. Let's hope the next entrant to the market does not make the same mistake.