Beta users · Lean startup

Lean Methology and your first, strategic customers

Aleksandra Czajka Freelance Senior Software Engineer, Developer, Web Developer, Programmer - Full Stack

May 13th, 2013

Friends,

Lean Methology teaches us to get customers right off the bat. 
Has anyone here ever done this? If so, what methods did you use to make sure the clients come through on their promise after the product is built? Did you use former contracts? Or was it just a confirmation email where the client stated they will use it? Were there any specifics as to the price they will pay? Was there any mention of a trial period or what would happen if they ended up not liking or needing the product after it has been built for them?

I welcome a discussion on this.

Best,

Kristann Orton Helping clients design at the intersection of business goals and technology needs | Innovation Catalyst

May 13th, 2013

Aleksandra - There are a couple of ways I have done this in the past: - beta or trial customer where they were required to give regular feedback during the trial; bonus validation if they purchased at the end of the trial - manually deliver requested features to existing customers, assess uptake and decide whether to implement - measure usage during a trial stage As for contracts, we would specify the trial period and the purchase price at the end of the trial, usually giving a good discount to motivate them to stick with the trial. We also specified that they could return if unsatisfied. Finally, we said we had the right to boot them out of the trial program if they were not using it and giving us feedback. Bottom line: I have never been successful getting the customer to pay money for a trial product but instead used the time they invested using the product as a measure of whether they would pay for it. Best beta programs had a project manager with regular checkins with the customer. Now for #2, where we were delivering manually a requested feature, you bet the customer paid for it - dearly! :) Cheers, - Kristann Kristann Orton kristann.orton@gmail.com 206.909.3972

Alison Lewis CEO/Creative Director

May 13th, 2013

I am looking into similar strategy and what was recommended to me was a discount coupon like 10% off the first product, take down their name, number, and ask them if they are OK with someone calling them to ask if they signed up for the product.  Mind you, I sell and work with physical goods, not virtual goods so I don't know if this works for you. 

Mark Piekny Engineer, Consultant & Entrepreneur

May 19th, 2013

Enjoyed your post Kristann.  Per Alison implications, much of the lean methodology can be difficult to implement on physical product development projects.  I've heard tales of entrepreneurs finding it difficult to find a suitable crowd-funding host simply due to the reward policy; that is, providing the customer AND the company tangible benefits through the delivery of very early physical prototypes is costly, both in dollars and in PR.  Any thoughts or feedback appreciated.

Aleksandra Czajka Freelance Senior Software Engineer, Developer, Web Developer, Programmer - Full Stack

May 19th, 2013

Well, I have an update here.

My actual product is VideoInterviewPractice.com. The pilot clients that I was looking for are career coaches to work with me and take the product from a b2c to a b2b. Mainly, the coaches would be my clients, paying me a subscription fee and percent per each transaction while using the platform with their own clients.

I managed to get 6 pilot users (and counting since I have meetings scheduled for next week) signed up this week to pay for the platform when it comes out in a month. I'm really excited about this and looking forward to when we actually get to the part when the b2b part is working and I've got these 6 pilot coaches to use the platform successfully, since that will be the actual proof that I've built something someone wants :-). 

What I essentially did is post as many discussion groups as I could in any applicable career coaching discussion group on LinkedIn. I've got about 3 pilot users from that. I also contacted all the coaches I knew from the surveys I've performed with them before I built the b2c part of the product.

It's also important to stress here that in my discussion groups and emails I sent to the coaches I didn't mention anything about the price. This helped focus my conversations with the coaches on the actual product. However, each one of the coaches has a slightly different idea on what the price should be and whether it should be a subscription or transaction percentage. 

So, here goes my second question. What is your opinion on working out a price plan separately with each pilot user and gauging from that what the standard should be? Or, should I establish the standard and charge every pilot user the same?

All my best and thank you all for your help!!
Aleks

Kristann Orton Helping clients design at the intersection of business goals and technology needs | Innovation Catalyst

May 19th, 2013

Well, we prototyped a room - you can’t get bigger than that! J We were creating immersive video conferencing. I was working with Dreamworks, so first we created Styrofoam mock-ups ala film sets - they really helped us with the color, lighting, textures, etc. Then when we signed up other customers, we had them pay a monthly fee (lease) for the equipment with a contract that stated they could cancel at any time but needed to pay for return shipping. Because we were creating a communications system, we were counting on them getting hooked. At some point, their equipment would be fully amortized and they would own it. I think the key with physical prototypes is to carefully hone your target, perhaps picking just a few customers in representative segments of your market. Then assign a “project manager” that keeps the customer on task for collecting feedback. Lastly, most of your testing should be on use and business models for maximum learning. Now we were not crowd sourced, and I am not sure what you mean about expensive PR. By the time you are ready to ship a physical prototype, I would think that you would have a few customers identified and vetted - we called them Lighthouse customers and they came through the relationship we had built with them, not through PR.