I recently had a call with the CEO of a company that I thought would be a great channel partner for my company. I’d been looking forward to the conversation; we’d convinced a few similar firms to partner with us recently and I was hungry for some momentum. When the call kicked off, I fully expected it would be another win.
But… nope. Zero interest on their end. Like not even a little. The call was over in less than 10 minutes.
It’s never fun when a business pitch tanks, but it happens. What made this one unsettling though was the feeling that I’d missed something important. It wasn’t like they already had a solution for what we do or didn’t have budget. We didn’t fit their business at all, and I wasn’t sure why.
Major elements of our sales and marketing plan, designed with companies like this one in mind, needed to be revisited at the least. Among other things, it was soon clear that we’d fallen into a common trap for startups and new products. We’d responded to market traction without properly understanding our users. It’s an easy mistake to make, but it’s also fortunately easy to avoid if you’re patient.
Traction Reaction
The odds are that you’ve never heard of Proscar, a prostate treatment patented by drug company Merck in the early 1990s. That’s because when Merck decided to market the exact same drug’s baldness-prevention properties too, they created a new campaign and brand. Propecia was a blockbuster drug, earning billions in sales. Whatever your feelings about prescription drug marketing, Merck understood the need to reposition the product so it was tailored to the motivations of a different segment.
We launched UserMuse with what we believed to be a deep understanding of our primary market: product managers at B2B software companies. Our beliefs about them have mostly held up, except the big one of them being our primary customers. That distinction instead belongs to the UX designers and user researchers who’ve gobbled up product tester market research panels from us at a significantly higher rate than product managers so far.
Cool, we thought. The user researchers use our platform for pretty much the same reason product managers do. Let’s go with it.
Discovering adjacent market opportunities is a fun part of startup life, but it can be a tricky hand to play when you’re dealt it. In our case, our most engaged users were now not only a different persona than we anticipated, they worked in different kinds of businesses – mostly agencies and UX research firms rather than software companies. Given our limited resources, we shifted our business development focus to emphasize these companies.
Don’t Abandon the Basics
The logic of reinforcing success is appealing: Go to market, see where you get traction, and find more prospects like them. The problem for us was that when success came where we didn’t expect it, we didn’t think very hard about what made this new segment different from our initial targets. We didn’t really know how they got work done or what their pain points were. They were buying, and we just wanted to just sell, baby. I think we were a little “researched out” at that point too.
It was six months before I did business reviews with these clients – spurred by my confusion after the botched sales call I mentioned. If you’ve ever forgotten someone’s name but felt you were too far along to ask them their name again, that’s what it felt like.
For the first time, we looked hard at this segment to figure out what made a prospect a good versus a bad fit for us. We asked them questions we should have asked much earlier to tease out their pain points. Also for the first time, we got input from them to better prioritize our product roadmap.
Reinforcing success isn’t just about how you allocate sales and marketing dollars; it’s about where you point all of the thinking and creativity your team can bring to bear. User discovery gives you the foundation for innovation. It’s tempting to skip that part when people are throwing business at you, because who cares? You’re making money! But you’ll get there faster if you invest in discovery upfront.
If you don’t, the odds are good that eventually you’ll get off a phone call, just like I did, wondering what the heck just happened and what else you’ve missed.
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