You might think that your early-stage startup is ready for funding right now, but before you start setting up meetings with dozens of investors, you need to make sure that you’ve taken the time establish a growing customer base.
Now, just because you think you have a great product that people love, there are a things to keep in mind when attracting and, most importantly, retaining your customers. To help you get started, we’ve outlined some vital considerations on customer development in this blog post, featuring insights from startup expert Donal Scannell (Founder of Born Optimistic and Co-Director of the Dublin Founder Institute).
Investors Want to See Traction
Too many early-stage founders believe that simply having a great idea and a strong team is all you need to qualify for funding. However, this is a pervasive myth that needs to die as quickly as possible, as most investors are interested in more than just an idea and a team. In fact, most of them are primarily interested in just one thing: traction.
Once your company has launched, your most important goal is to get traction. This may seem obvious, but if you have any desire to attract investors in the future, you need to prove that you know who your customers are and that you’ve demonstrated the ability to turn them into repeat customers.
When you’re searching for product market fit you need to show that you understand who your customer is, that they love your product and will pay for it. It seems painfully obvious but it’s always worth saying: the best way to show this is by acquiring more and more of the same type of customer.
However, before you begin building your customer base, you first have to determine who your ideal customers are, which brings us to our next point.
Focus on Only One Ideal Customer in the Beginning
When carrying out customer research, you may end up with numerous customer archetypes, which is not necessarily a bad thing, but may make your sales and pricing strategies needlessly complicated. Especially if your startup is still in its early stages, it’s imperative that you and your team focus on attracting your one ideal customer before you expand operations to attract your other customers.
Once your company has proved the demand for your product or service, or when you’ve received funding, then you can begin the process of improving on your offering to attract other customers and expand to other regions. But until then, stay hyper focused on building a small but loyal audience.
The narrower your customer focus the more efficient your day becomes. When you know your customers and only have one persona to focus on you get to make every meeting count.
By having a lear target customer that you are constantly aiming at, you’ll be able to get better, more accurate data on which of your tests succeeded or failed. Also, by first focusing on only the customers most likely to purchase your offering, you’ll ensure that you can get farther along without the aid of funding; a sustainable company is always attractive to potential investors.
But once you’ve gathered a loyal customer base, what should your next priority be?
Retaining customers, that’s what.
Treat Your Customers Right
Customer support is something that both companies and customers generally don’t look forward to dealing with.
Customers hate having to call or email a company about a challenge they’ve encountered with their offering because this often entails having to wait for what seems like forever to get a response, and companies hate having to deal with angry customers and having to walk them through operating a product or the process of returning it.
However, if customer support teams made a more concerted effort to really treat the customer as if they were special, startups could experience better customer retention, satisfaction, and profits. When customers are greeted with extra helpful, professional, and friendly customer support, they are not only more likely to buy from you again, but are more likely to recommend your company to their friends.
Below are a fairly simple ways that your company can be more customer-friendly:
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Stop sending “do not reply emails”. Doing this makes your interaction more impersonal, and makes it harder for customers to get ahold of you. Instead, send personal responses, as this establishes a more human and trustworthy connection.
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Include humor in your automated processes. Automation is often associated with bland, robotic interactions, and understandably so. However, injecting a little humor can give the user experience some more personality, which encourages customers to continue interacting with your company.
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Remember that you’re talking to humans, and not angry jerks. This tip is more of a mindset rather than a straightforward method, but keeping this bit of advice in your head when interacting with customers help you remain calm and personable, even when dealing with the most difficult of customers. Remember, no matter how difficult a customer is, they were still gracious enough to spend money on your offering.
The faceless aura that large web companies initially built up is being chipped away. They realise they need to wrap human stories around what they do.
Something else to keep in mind when talking to customers, is that what may seem like a trivial complaint from their end may actually turn out to be a useful insight into a bug or problem with your product or service. Treat every criticism as potentially insightful feedback regarding your company.
Final Thoughts
When it comes to just about everything related to launching and running a startup, you’re bound to encounter plenty of challenges and experience numerous failures. However, in times of duress, it’s important to treat every misstep like a lesson, so remember to collect as much data from every experiment you run and every test you conduct. Even the harshest lessons can provide the best insights.
