I had breakfast with two of my ex-students from Singapore who were building a really interesting startup. They were deep into customer discovery and presented a tonne of customer data on the validity of their initial hypothesis – target customers, pricing, stickiness, etc. I was unprepared for what they said next. “We’re going to do a big launch of our product in three weeks.” I almost dropped my coffee. “Wait a minute, what about the rest of customer development? Aren’t you going to validate your hypotheses by first getting some customers?”
Without any sense of irony they said, “Oh, our investors convinced us to skip that part because our customer feedback was all over the map and our schedule showed us launching in three weeks and they were worried that we’d run out of cash. They told us to stay on schedule.” Now I was confused, and I asked, “Well what do you guys believe – customer development or launch on a schedule?” Without missing a beat they said, “Oh, we believe both are right.”
I realised I was listening to them treat Customer Development as an item on their To-Do list.
Suddenly, I had a massive case of déjà vu.
Can You Pull This Off
I was VP of Marketing at Ardent, a supercomputer company where a year earlier I had a painful and permanent lesson about customer discovery. I was smart, aggressive, young and a very tactical marketer who really hadn’t a clue about what strategy actually meant.
One day the CEO called me into his office and asked, “Steve I’ve been thinking about this as our strategy going forward. What do you think?” And he proceeded to lay out a fairly complex and innovative sales and marketing strategy for our next 18 months. “Yeah, that sounds great,” I said. He nodded and then offered up, “Well what do you think of this other strategy?” I listened intently as he spun an equally complex alternative strategy. “Can you pull both of these off?” he asked looking right at me. By the angelic look on his face, I should have known that I was being set up. I replied naively, “Sure, I’ll get right on it.”
Ambushed
25 years later I still remember what happened next. All of sudden the air temperature in the room dropped by about 40 degrees. Out of nowhere the CEO started screaming at me,
“You stupid x?!x. These strategies are mutually exclusive. Executing both of them would put us out of business. You don’t have a clue about what the purpose of marketing is because all you are doing is executing a series of tasks like they’re like a big To Do list. Without understanding why you’re doing them, you’re dangerous as the VP of Marketing, in fact you’re just a glorified head of marketing communications.”
I left in a daze, angry, and confused. There was no doubt my boss was a jerk, but unlike the other time I got my butt kicked, I didn’t immediately understand the point. I was a great marketer. I was getting feedback from customers, and I’d pass on every list of what customers who wanted engineering and tell them that’s the features our customers needed. I could implement any marketing plan sales handed to me regardless of how complex. In fact, I was implementing three different strategies. Oh…hmm… perhaps I was missing something.
I was doing a lot of marketing “things” but why was I doing them? I had approached my activities as simply as a task-list to get through. With my tail between my legs I was left to ponder; what was the function of marketing in a startup?
Strategy is Not A To-Do List, It Drives A To-Do List
It took me awhile, but I began to realise that the strategic part of my job was two-fold. First, (in today’s jargon) we were still searching for a scalable and repeatable business model. My job was to test our hypotheses about who were potential customers, what problems they had and what their needs were. Second, when we found these customers, marketing’s job was to put together the tactical marketing programmes (ads, PR, tradeshows, white papers, data sheets) to drive end user demand into our direct sales channel and to educate our channel about how to sell our product.
Once I understood the strategy, the To Do list became clear. It allowed me to prioritise what I did, when I did it and instantly understand what would be mutually exclusive.
Good Luck And Thanks For the Fish
My students were going through the motions of customer development rather than understanding the purpose behind it. It was trendy, they had read my book and, to them, it was just another step on the list of things they had to do. They had no deep understanding of why they were doing it.
So they were at a crossroads. Since their investors had asked them to launch now, what happened if their initial assumptions were wrong? As they left I hoped they would be really lucky.
[This post by Steve Blank first appeared on the official website and has been reproduced with permission.]
