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Listen, Adapt, Live Another Day

March 7, 2012

Listening to your target audience is perhaps one of the most important things a New Market Entrepreneur can do across the company development spectrum.  Recently we happened upon two separate blogposts we thought we would tie together as great examples of the importance of listening and adapting.

The first post, published by Steve Blank whom we site often, offers a great story of a New Market Entrepreneurs struggles with developing the right product and discovering a scalable business model because he is listening to his customers and prospects incorrectly.

The art of entrepreneurship and the science of Customer Development is not just getting out of the building and listening to prospective customers. It’s understanding who to listen to and why

Part of Customer Development is understanding which customers make sense for your business. The goal of listening to customers is not please every one of them. It’s to figure out which customer segment serve your needs—both short and long term. And giving your product away, as he was discovering, is often a going-out-of-business strategy…

The work he had done acquiring and activating customers was just one part of the entire business model…

As we started the long climb back, I suggested his fix might be simpler than he thinks: He needed to start thinking about what a repeatable and scalable business model would look like…

He needed to think through his revenue model (the strategy his company uses to generate cash from each customer segment). And how was he going to use pricing to achieve that revenue model? Freemium is just one of many tactics. Single- or multi-sided market? And which customers did he want to help him get there?…

If you have time, Blank shares the info excerpted above in the form of a very relate-able story of the deep conversation he has over a long hile with a former student turned frustrated entrepreneur…  read more

The next post covers the importance of listening much further down the entrepreneurial development spectrum… when you have customers!  Specifically, Adapt or Die suggests that brands who stick their head in the sand and try to ignore or whitewash negativity about them in social media do so at their own peril.

The Internet is the world’s biggest focus group and it runs 24/7. Brands that fail to understand that and just treat it like another advertising venue are missing out on one of the biggest values it can offer them!

This is an absolutely critical point. Since the dawn of the advertising industry in the 1850‘s, corporations have been in broadcast mode, their energy focused on how best to present themselves to potential customers in order to manufacture demand for their products. Perhaps it’s no surprise that habits formed over the course of a century and a half would be slow to change, but by treating social media as just another advertising venue, brands really are missing out. Many of them come across as loud, self-important blowhards at a party who spend all their time boasting about how great they are and completely failing to engage with their customers and potential customers in any meaningful way. The brands that are the most successful are the ones that are the best listeners. Instead of treating social as though it was television 2.0, these folks understand that they can maximize ROI by building relationships; they use social media to keep the conversation focused on their customers—what they want, how they use the products, what the brand means to them. Aside from being an absolutely fantastic market research tool, this approach plays to the very real human desire to feel listened to and valued.

This can’t just be a gimmick or people will see through it. If you ask your customers what they want to see from your company in the next year and then completely ignore their suggestions, all you would have done is pissed off and alienated them. But companies who can take that feedback, internalize it, and react to this new powerful market force in a meaningful way can succeed where others fail.

It’s easy to get excited about good customer feedback, but if all a brand allows themselves to hear is good they’ll find themselves in a much more dangerous filter bubble—one of their own making. Every negative review, every negative comment, is an opportunity to re-engage with a customer, give yourself a second chance to do it better, and learn a powerful lesson. The choice isn’t whether to engage or continue to do business the old way; the choice is adapt or die.

read more

Good listening skills will take you far in life and in your New Market Entrepreneurial endeavors.   However, as Steve Blank’s post reminds us, when you are a start-up in search of a  repeatable and scalable business model and a means to ultimately make money, you need to know who to listen to.  Of course, Steve Jobs would argue you don’t need to listen to them at all.  So if you think you have the product insights of Steve, feel free to skip the listening step!  For the rest of us, this story is an important reminder that we need to have the big picture in mind as we attempt to discover the right product mix and revenue model.   Adapt or Die, on the other hand, reminds us that there is value to be reaped via deep and meaningful customer interaction.  Such interaction cannot be deep or meaningful if you are not listening and are not authentic.

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