10. Instruments for Customer Analysis and Validation...

Fakultät Informatik - Institut Software- und Multimediatechnik - Softwaretechnologie – Prof. Aßmann - Software as a Business

10. Instruments for Customer Analysis and Validation (Customer Modeling)

Prof. Dr. Uwe AßmannSoftwaretechnologieFakultät InformatikTechnische Universität Dresden2018-0.4, 10/26/18http://st.inf.tu-dresden.de/teaching/saab

1) Customer Analysis

2) Different Kinds of Fits

3) Customer Analysis

1) Situation Analysis

4) BMC Evolutionl

5) The Evolving Nested BMC Cactus

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2 Software as a Business

Obligatory Literature

► A. Osterwalder, Y. Pigneur et al. Value Proposition Design. Wiley.

► [BlankDorf] Steve Blank, Bob Dorf, Nils Högsdal, Daniel Bartel. Das Handbuch für Startups – die deutsche Ausgabe von 'The Startup Owner's Manual'. Deutsche Übersetzung von Kathrin Lichtenberg. 2014. O'Reilly.

■ http://www.daniel-bartel.de/das-handbuch-fuumlr-startups.html

At one period of those early days I think that I must have had fully three hundred watches. I thought that I could build a serviceable watch for around thirty cents and nearly started in the business. But I did not because I figured out that watches were not universal necessities, and therefore people generally would not buy them.

Henry Ford. My Life and Work. Www.gutenberg.org Ebook #7213

At one period of those early days I think that I must have had fully three hundred watches. I thought that I could build a serviceable watch for around thirty cents and nearly started in the business. But I did not because I figured out that watches were not universal necessities, and therefore people generally would not buy them.

Henry Ford. My Life and Work. Www.gutenberg.org Ebook #7213

http://Www.gutenberg.org/

http://Www.gutenberg.org/


10.1. Customer Modeling

Find out who the customer is, what she needs and desires.. a specific part of the Lean Innovation process[Blank]

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The Customer Modeling Process

Customer Discovery Customer Validation Company BuildingCustomer Creation

Customer Search Customer Building

Customer Modeling (Customer Analysis)

► Customer Modeling, a company-centric process [Blank/Dorf] 2008■ Originally called “Customer Development”, but we use this differently in

this course

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Q3: Blank's Customer Modeling Process “Customer Development”

1. Customer Discovery

(Customer Analysis)

2. Customer(Hypothesis)

Validation

3. Customer Creation

(Kundenaufbau)(Selling)

4. Company Building(Unternehmens-

Aufbau)

I. Customer Search

Disillusioned?StrategicChange

Verified

Found Verified

II. Customer Building(real Customer Development)

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Q3: Blank's Customer Development Process Blended with Maurya's Running Lean Process

Customer Discovery

Customer(Hypothesis)

Validation

Customer Creation(-aufbau)

Company Building(Unternehmens-

Aufbau)

Customer Search

Disillusioned?

Verified

StrategicChange

Found Verified

Customer Building

Problem-Solution Fit Product-Market Fit

Efficiency (Sell) Scale

(Startup Genome Report)

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Q4: Step 1: The Customer Discovery Subprocess (Problem-Solution Fit)

1.1 Customer Vision

1.2 Customer Interviews

(MVV testing)

2.1 Customer tests

(MVP testing)

StrategicCrisis

1. Customer Discovery

Disillusioned?

StrategicChange

Verified

MVVFound Verified

2. Customer (Hypothesis) Validation

Problem-Solution Fit

No

Yes

Product-Market Fit

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Q4: Step 2: The Customer Validation Subprocess (Product-Market Fit)

2.1 Sales Preparation

2.1.2 IdentifyEarlyAdopers

2.1.3 OptimizationPlans and Tools

2.1.4 Sales Roadmap(Vertrieb)

2. Customer Validation

Disillusioned?StrategicChange

2.1.5 CustomerBinding and

Development

2.2 Product Development

2.3 Assessment

Product-Market Fit


10.2 Different Kind of Fits in the Value Proposition Design Process

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Steps in the Stages of Maturity

Smoke-Market

Fit

Product-MarketFit

Efficiency Fit(Sell)

Lean Innovation Process

Fitness stages

red

Problem-Solution

Fit

yellow green red yellow green red yellow green red yellow green

Example

► A green problem-solution fit is a value proposition stable pain/gain analysis, but without services and products

► A green Smoke-Market-fit is a BMC with a competed smoke test

► A green product-market fit is a value proposition stable pain/gain analysis with services and products, i.e., a stable BMC

Scale Fit(Virality)

red yellow green


10.3 Customer Analysis (Discovery):Analysis of the Customer's World

Before understanding the pain and gain of the customer, we need to understand its world

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The Major 4 Obstacles to Customer Know-How Can Only Be Remedied by Testing the Customer Hypotheses

► In a group, untested information about the customer can be collected by canvases

► Hypotheses about the customer have to be formed► Hypothesis must be tested by getting out of the building

[Alvarez, Blank/Dorf]

Engineer'sIgnorance

Self BiasIgnorance of

Customer Search

Bias towards one's own great idea and technology

Being an engineer seduces to skip validating ideas

Ignorance to know how to find customers

Ignorance ofStart

Ignorance to know how start

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Aspects of Customer Analysis

Day

Relationships

Feelings

Basic Need Pyramid

Persona

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Empathy Map for Customer Modelling

16

http://blog.8thcolor.com/2011/08/who-are-our-posible-customers/empathy_map/

https://dschool.stanford.edu/wp-content/themes/dschool/method-cards/empathy-map.pdf

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Simpler: Modelling the Customer's Feelings

Prof

. U

. Aßm

ann, TU

Dre

sden 10.

wp-content/uploads/2013/02/mitroff.fig2_.jpg

http://www.johndoyle.ie/?p=92

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Modeling the Customer's DayHow should a good “Customer Day Canvas” look?

NightMorning

BreakfastMorning

WorkLunch

AfternoonWork

DinnerEveningHome

EveningOut

Go to BedFallingAsleep

► Use the Customer Empathy Map to run through the customer’s day

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Customer Need Analysis with Maslow

► Play your customer …. and fill a Maslow pyramid

http://upload.wikimedia.org/wikipedia/commons/thumb/2/2c/Erweiterte_Bed%C3%BCrfnishierarchie_%281970%29_nach_Maslow.svg/600px-Erweiterte_Bed%C3%BCrfnishierarchie_%281970%29_nach_Maslow.svg.png

physiologic

safety

social esteem

love/belonging

cognitive

esthetics

self realization

transcendence

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Analyzing the Customer's Relationships

► An organizational / influence map draws the network of the customer that can influence his buy-no-buy decisions

► Analysis can start with a table or a graph

► Analysis constructs a dependency graph (partial or total order)

► Deciders are the sinks of the dependency graph

[Blank/Dorf]

Managerial Technical Financial

High Department boss

Accounter

Middle Engineer

low Project leader End user

1 2

3

4 5<<depends on>>

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Customer Relationship Analysis with Business Model You

► Play your customer …. and fill a BMY Canvas.

Key PartnersWho helpsYour customer?

CustomerRelationshipsHow does sheinteract?

Customer SegmentsWhom doesYour customer help?

Key activitiesWhat do Your customer do?

ChannelsHow do they know him?How does shedeliver?

Key ResourcesWhat she isand has

Value PropositionHow does Your customer help?

Cost StructureWhat does he give?

Revenue StreamsWhat does she get?

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Customer Profile (Persona)

► A Customer Persona (profile, archetype) is a story about an average customer from a customer segment.

■ Derived from Empathy Map, Influence Map, VPA, Problem Analysis, Customer's Day, Customers influence map

► Table form of Persona:

Highlights in the customer's day, problem canvas, VPC, or influence map

Hints for aquisition

Gets up with difficulties Don't call him before 10:00; send him a coffee kit for advertisement

Doesn't like to read Send him a DVD with video

Has friends in political party PDU Analyze partie's opinion about the effects of your product

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Refinement of Customer Segments and Market Slices

Target Person Group

Target Market (TM)

Served Adressable Market (SAM)

Total Adressable Market (TAM)

Target Person Profile (Persona)

[Blank/Dorf]

Concretenesslevel


10.4 Basic Pain-Gain Analysis (Value Proposition Analysis) of Osterwalder

Value Proposition CanvasFrom “Value Proposition Design”

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Killing Pain and Filling Desire

► Customer Analysis is something different than Selling.■ Selling addresses an individual customer■ Customer Analysis analyses the world of a potential customer

► Needs do not make a customer buy – only pain.

► Value does not make a customer buy – only desire.

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VPC

► Osterwalder refined the value proposition field of the BMC with a new canvas, the Value Proposition Canvas.

Pain and Gain create value proposition.Pain and Gain create value proposition.

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TU Dresden, Prof. U. Aßmann Earning money with softwarehttp://businessmodelalchemist.com/

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VP Canvas Process

► VPA uses a canvas to map the customer pains and gains to products and services

Productsand ServicesQuestions

GainGain Questions

Customer Job/SituationQuestions

Gain creatorQuestions

PainsPain Questions

[Osterwalder-VPD]

Pain relieverQuestions

Customer ProfileValue Map Value Proposition

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VP Canvas Mapping and Fit

► VPA creates mappings between the entries of the customer profile and entries of the value map (value proposition fit)

► Check completeness, consistency of fit!

Productsand ServicesQuestions

GainGain Questions

Customer Job/SituationQuestions

Gain creatorQuestions

PainsPain Questions

[Osterwalder-VPD]

Pain relieverQuestions

Customer ProfileValue Map Value Proposition

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VPC is a Subcanvas of the Business Model Canvas

Key Partners CustomerRelations

Customer Segments

Key Activities

Channels

[Osterwalder-BMC]

Key Resources

Customer ProfileResources

Value Proposition(Wertangebote)

Costs Revenues


10.5 Evolving the BMC Cactus during Startup Development

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The Evolving BMC-VPC Canvas Cactus (extended)

► Growing a tree with side edges (link tree - cactus) out of a first version■ Assess with red-yellow-green; choose a current “greenest” “champion”

► Every step tests hypotheses about the customer► Not too many canvases are kept active (small dashboard)

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BMC-VPC Refinement is Customer Modeling

► The BMC-VPC cactus evolves during customer modeling

A red BMC-VPC shows why a persona cannot become a customerA red BMC-VPC shows why a persona cannot become a customer

A green BMC-VPC models a customer faithfullyA green BMC-VPC models a customer faithfully


10.6. The Evolving Cactus of the Nested BMC

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The Dependency Structure of Canvases (the Nested BMC)

► How would you maintain an evolving cactus for all these canvases?

BMC

VPC Customer JourneyCanvas (CJC)

ReqEC

ChannelFlipbook Canvas

Pain CanvasPain Killer Canvas

Pain-GainBananaPain Portfolio

CustomerEmpathy Map

CustomerBMCY

Customer DoubleFunnel Canvas

SPIN™ Canvas

Solution Selling™

Canvas

Gain CanvasPain Creator Canvas

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The End

► Explain the difference between customer empathy, activation, stickiness, virality and referral.

► What is the difference between untested, assessed, and tested canvases?

► What is a strong real tested pain?

► Why are catastrophies better for a good value proposition than blocking factors?

► Explain the influence of the UCA for virality.

► Why is the pirate metrics important for building good value propositions?

► How can you cross the border between Virality and Revenue in the LeanAnalytics stages?

► Explain the differences between the SPIN™ Canvas and the VPC. Which canvas do you prefer for a cold call?

► Explain how you use the Channel Flipbook Canvas, the Customer Empathy Map and the Customer Double-Funnel Canvas for a Customer and Customer-Segment Analysis.

10. Instruments for Customer Analysis and Validation...

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