We’ve advised, mentored, and consulted with close to a hundred startups over the years and can count on one hand the number of companies that could quantify the impact their solution had on their customers and support those claims with solid evidence.
It’s not easy for sure, but I guarantee that if you can build evidence to support the impact on your customer’s key metrics, you’ll find both sales and fundraising will be orders of magnitude easier.
Let’s explore how to go about doing this by answering these five questions:
1) What are your target buyer persona’s key success metrics?
Who is your target buyer and how do they measure their success? What are their critical problems or responsibilities and how are you able to support them?
For example, if your target buyer persona is the VP Sales, it may be to improve their win/loss ratio, shorten the sales cycle or increase average contract value. If you’re trying to sell to the CEO, it may be to grow revenues, increase profitability or employee satisfaction.
2) How does your solution impact these key metrics?
Frame your value proposition and messaging in terms of how you impact those key metrics. You may not be able to quantify your impact until the product is built and deployed, but you should be able to quantify the problem and you should be able to estimate the anticipated impact of your future solution.
For example, Our calendar scheduling app is expected to save your sales reps 8 hours a week by removing frustrating customer back-and-forth emails so that your reps can set up more meetings faster and close more business.
3) Is the impact of your solution material to your customer’s business?
The more precisely you understand and can measure drivers of your expected impact, the more successful your business will be.
Is the problem material enough that target customers are motivated to change from the status quo to an unproven solution from a new vendor? What constitutes material is, of course, something you need to know and will also be linked to the customer’s adoption effort and risk to their business.
For example, would a VP Sales implement a new calendar scheduling app if it saved 1 hour a week? Would they implement a new solution if it risked dropping the odd meeting invitation? Or if it took 3 months for IT to integrate it?
If target customers are skeptical or struggling with accepting your anticipated impact on their metrics or they’re concerned about the implementation effort/risk, then perhaps seek independent (paid) validation such as an academic research paper, customer review, consultant report or perhaps even reference the results from an adjacent industry.
4) What key capabilities are you delivering that drive impact? Are they unique?
What is unique about your solution that gives your customer confidence that you can deliver the anticipated impact on their business and that you can do it with manageable implementation effort and risk? As a product owner, this deep understanding can help you prioritize and direct your key features.
For example, Our solution works behind the scenes to coordinate free/busy calendar availability for all participants and only recommends times when all parties are available. What’s more, it meets GDPR privacy requirements and can be implemented with one keyclick, so you can give it a try right now and then roll it out to your department when you’re ready.
5) Can you support those claims?
Once you reach MVP, you should work with your first customers to measure your impact and use those metrics to unlock an enterprise-wide rollout, assuming initial deployment was contained to a small group. The results should be a call-to-action that forms an anchor in your sales and marketing communications plan.
For example: If we can reduce the time your sales reps spend on scheduling meetings from 8 to under 1 hour a week, would you buy a site license? Or if we can help you schedule 10% more meetings a week during a one-month pilot, would you buy a site license?
By the end of this exercise, you should be able to clearly quantify your benefit in a compelling way that will excite and inspire your customers, investors and employees.
The format and structure are simple:
Our [SOLUTION] helps [PERSONA] save [QUANTIFIED METRIC] by [CORE CAPABILITY] so that you can [BENEFIT]. Contact us to find out how.
Collecting the evidence to support your claims is always the challenge. Regular readers of our blog know this is done with a structured customer discovery process designed to uncover the evidence you need.
Armed with a quantified, high-impact business-centric message and the supporting evidence, you will be well on your path to product/market fit.
Contact the Evidology Group and we’ll help you get there.