At Sussex Innovation, one of the most valuable services that we offer to our members is to scope and conduct extensive customer insight projects. We help our members gain true insight into what motivates their potential customers, what pains those customers have, how they currently solve them, what they will pay for and how they want to buy it.

Customer-led design is the mantra of many leading digital businesses, with companies releasing a minimum viable product (a rudimentary version of their idea) into the marketplace, and designing new versions of that product after receiving customer feedback about what features they would like to see integrated into its design. It’s also why massive technology companies like Google, Facebook, Microsoft and Apple continually release updates and patches for their products, feeding in a stream of new features that their most valuable customer segments have tested and love. This process is often known as ‘lean development’, and is particularly suited to the digital industries. But, it’s crucial to remember that whatever industry we are in, we must interact with as many potential customers as we can to find the underlying motivations for their behaviour and the problems they might pay to solve. For more about that check out my colleague Peter Lane’s article here.

Last year, one of our members, Maven Rocket commissioned the Sussex Innovation support team to help with a customer-led design project. Howard Sanford, CTO and founder of MavenRocket says:

“If we were a typical software studio, when building our Google AdWords tool, we would have rushed in feet-first and delivered what we though the customer should want. We would have built a ton of features that no-one wanted and would have spent a lot of money on an expensive app with no customers. Instead, thanks to Claire’s help and guidance, we garnered feedback before committing anything to the whiteboard, and in the process discovered that who we thought would be our typical customer, turned out to be the exact opposite. Instead of building for the archetypal AdWords user, our app is now laser-targeted for AdWords/PPC/SEM Agencies, making them more profitable, and as a side benefit, because of the customer-led process, we also have a list of interested prospects, some of whom welcome the opportunity to participate in the pre-beta release.”

Designing features for imaginary customers instead of listening to potential customers’ feedback can often spell the downfall of a business before it’s started. Apple encountered this problem in 1993 with the Apple Newton. A hand-held PDA, Apple launched the product they thought the market would need, rushing the planning, testing and research to get a jump on the market. This led to many features that consumers couldn’t use or didn’t need, so much so that a cartoon strip was made about the inadequacies of the main handwriting feature. Although much of the technology ended up being reused in the iPhone further many years later, the Apple Newton was scrapped as customers just couldn’t connect with it.

Customer feedback is important, but it’s just as important to ask the right group of people and not assume that everyone will need your product or idea equally. In my work as a Marketing Advisor, I often start by helping a member segment their market. It’s much better for a start-up to design something that suits a smaller, dedicated market than trying to please everybody.

Customer segmentation is an important step in this process, but I’ve found that there are very few ‘methods’ available for small or start-up businesses. Try Googling it and you’ll find lots of references to the importance of segmentation, but little explanation of how to actually do it. That can be very frustrating for new businesses who have a great idea but very few or no customers to test it on, so here at Sussex Innovation we’ve created a simple method to dig deeper into who might be most compelled to buy an idea. For more information on how to do it for your own business just email me directly.

Designing with customers builds the foundations of a good business idea. But the next challenge is creating a business model that actually makes money – more about that soon.

For more on our StartUp series, click here.