Stage 4: Discover the Unknown
Many companies succeed in developing an innovative solution to address customers’ pains and gains only to discover too late that no one wants their new value proposition. So how do you avoid unnecessary investment and increase the chances of a successful launch? In Stage 4: Discover the Unknown, you learn how to use prototypes, MVPs, and behavioral insights in our Experimental Design Labs to ensure your value proposition addresses customers’ core needs and has a strong product-market fit. After completing validation testing, you have a proven concept ready to scale.
Note: This blog post is the fourth in a series of five as we ‘pull back the curtain’ on Future Proof’s methodology to Becoming a Future Proof organization. If you are new to our methods, check out this post for a quick summary of our overall methodology!
Discover the Unknown is the fourth stage of Future Proof’s methodology and uses lean start-up methods, design thinking prototyping practices and agile validation tools to test and validate that customers want and will buy your new value proposition. During the Discover the Unknown stage, you also learn tried-and-true validation testing techniques to apply across your organization to validate and refine other products and services.
At the end of the Discover the Unknown stage, you will have:
✓ Validated value proposition(s) and/or business model(s) ready to be implemented
✓ Greater organizational capacity in validation techniques
✓ Esurance that your new value proposition solves a customer’s need
✓ Confidence that there is a strong product-market fit for your new value proposition
Understanding the importance of value proposition validation
Back when the Sony Walkman was dominating the personal music market, Sony held a focus group to test out a new yellow sport-style Walkman. During the focus group, the participants gushed over the new color and design, leading the Sony team to think that the yellow sports model would be a hit. At the end of the focus group, every participant was allowed to take home either a traditional black Walkman or a new yellow sports Walkman as a small token of appreciation. Not one participant chose the yellow Walkman.
This story reveals the pitfalls that can easily befall an organization when delivering a new product or service to the market. You’ve done the hard work of consulting customers and focus groups throughout the development process, but when the finished product or service is launched, those same people don’t buy it or even express real interest in it. This can be a frustrating, expensive, but unfortunately all too common experience for organizations. So how do you avoid this situation and deliver desirable services and products to your customers on your first launch? Through rigorous validation techniques that validate and refine your initial ideas into something that customers will find simply irresistible.
Using proven and robust validation techniques to ensure product-market fit
Robust validation is more than asking a focus group about product preferences or showing a few customers a prototype. Instead, validation requires a rigorous approach to testing the idea AND the assumptions behind it. During Stage 4, you will learn how to use our validation tools and techniques –such as prototyping, AB testing, landing page and Ad campaign testing and congierge testing – to validate the assumptions underpinning your value propositions developed in Stage 3.
This is not a traditional approach to R&D: our Experiment Designers work with your team in our Experimental Design Labs to develop unorthodox ways to test assumptions and customer behavior with new products, services, and business models. You discover the smallest ways we can test our riskiest assumptions, saving your organization time and money in developing a desired and substantiated value proposition.
During these processes, you discover things you didn’t know you didn’t know about your market and customers, as well as test customers’ willingness to pay for a solution. Perhaps certain customer segments want an analog tool rather than a digital one, or you discover that there are different sales channels that customers prefer.
You may develop a minimum viable product (MVP) not only to test with customers product design, UX and technical questions, but also the very business hypothesis underlying the value proposition. At Future Proof, we are big fans of MVPs, and we show you how to avoid common mistakes businesses make when coming up with an effective MVP. Our Experiment Designers work with you to ensure your MVP:
- Is customer-centric and scalable
- Features adequate elements and functions to test the core value proposition
- Provides value to customers that they would be willing to pay for the value proposition.
For example, a MVP could be a landing page with sign-up for a waiting list or a basic beta product to deliver to customers. MVPs have been used by many industry giants to test and make their start, including Airbnb and Dropbox. The online e-commerce company, Zalando, for instance, started by using pictures of shoes from brick-and-mortar shoe stores that the founders would then buy, package, and ship when someone ordered shoes online.
You rapidly test, evaluate results, integrate learnings into the next iteration, and test again. This is called the Build-Measure-Learn feedback loop, and our Experiment Designers help guide you through the loop with the minimum amount of effort.
For example, if your new value proposition was a software solution to help manufacturing businesses estimate their greenhouse gas emissions, you may work with our Experiment Designers to develop a landing page or a demo video with a mock-up of the value proposition to gauge interest before ever having to spend money developing the software. The questions and feedback generated by the demo video may indicate a strong interest in such a calculator or reveal a different need, such as a physical tool to measure emissions on site.
Discovering new business opportunities
After validating one or more value propositions during the Discover the Unknown stage, you may begin to rethink some of your existing business models, as well as considering the material and human resources needed to deliver new products or services effectively. Our Experiment Designers work with you through those considerations, empowering you to broaden your organization’s scope. This may include uncovering new markets, distributions channels, and business models to successfully deliver value to tomorrow’s customers.
At the end of the Discover the Unknown stage, you and your team will have one or more innovative value propositions and/or business models ready for implementation. But how can you successfully scale and deliver your new offering? Read on to learn about how to scale your validated value proposition and ensure its continued success.
Are you looking at investing in a new product line or developing a new business model? Avoid costly upfront investments and faulty launches by working with our Experiment Design Labs? Contact us here about how we can help validate your ideas and build your organizational capacity to test and create desired value propositions. Please reach out to us here to discover how we can empower your organization to gain clarity of its position in the market and chart your success in tomorrow’s world!