In an earlier post, we detail how most product companies see their market fit erode between the five and ten year mark (we call it the 7-year glitch), and how hard-gained market share can be snatched by smaller players at any time.
To keep on solid ground, we highlighted the importance of bringing a robust product innovation approach to the core of the business by connecting it to your business objectives. This can help to retain relevance and drive long lasting business and customer value.
In this post, I want to consider what discovery practices can prevent progressive market fit erosion and directly support core business innovation.
1. Frequent interactions with the people the product is for
The first and most important shift is to move away from product discovery as a ‘one-off project’, as echoed by Teresa Torres in her recent book called Continuous Discovery Habits. Teresa advises a weekly cadence for direct customer engagement to ensure teams improve the product over time.
"At a minimum, weekly touch points with customers by the team building the product, where they themselves conduct small research activities in pursuit of a desired outcome."
<quote-author-title>Author of “Continuous Discovery Habits”<quote-author-title>
This statement is less an injunction to stick to a strict weekly cadence of user interviews, and more a guiding principle: touchpoints with customers should be routine activities designed to find out more about how to better serve customers and create value for the business.
It’s good advice considering that many product teams struggle to establish frequent interactions with the people who use the product, or have stopped using it. Understanding their needs, frustrations and motivations is paramount. Being able to refine this understanding and test new ideas is often a factor of success and a means to prevent market fit erosion.
2. Regular, higher altitude product market fit analysis
Discovery happens at different altitudes. This weekly cadence is only part of the story. Products are fluid: they can be improved based on a better understanding of what customers need; but they can also radically change to meet a new market, take advantage of new technology, or embrace a nascent shift in customer behaviour.
These factors are unlikely to become apparent from customer interviews alone, making it all the more important to carve out time to uncover and analyse them.
At Beyond, we mix business strategy with design thinking methods and increasingly reframe ‘evaluative discovery’ for a live product as ‘product market fit analysis’. By doing this, we are able to evaluate the level of fit or disconnect between the current product and its target market.
What do we mean by product market fit analysis?
As a product leader, you’re used to managing risk (in its varying forms) and placing bets on new opportunities/markets. A product market fit analysis is a form of product discovery that complements your continuous activities such as customer interviews and data analysis. This feeds into your risk assessment processes because it uncovers the risks of an eroding market fit for your product and benchmarks that against your competition.
For product-centric companies where the product is the business, this should take place annually at a minimum, or better yet, at key inflection points during the product life cycle. A six monthly cadence allows for the world to change but is fast enough to ‘keep up’ with the broader trends playing out in a target market.
We’ve honed into this topic with real-life examples in our blog post: Product Market Fit Analysis: What is it and how can it be applied to you?
Looking at your data and being agile enough to pivot
Have you heard of “Burbn”? This was formerly Instagram before the founder realised that the social channel wasn’t taking off. After analysing customer data, he realised that customers were engaging more with the photo posting and sharing aspect of the social network. A quick pivot led to a photo-based app that went onto being the billion-dollar business that it is today.
Then there’s AirBnb, which had been around for a few years before the founders concluded that the user interface was holding the product back from scaling so they turned their attention towards the design and user experience of the platform.
In an ever-changing market, one-time pivots may not be enough. US based investment platform Wealthfront pivoted its product 6 times since it was founded in 2008 to keep up with customer expectations and face up to competitors.
Depending on what you find in your product market fit analysis, you may need to change course. Pivots are likely to affect the way you achieve product market fit, but they can be instrumental in helping you get there.
These discovery practices can save you the time and frustrations of bringing your product to market and later realising that you’re solving the wrong problem, or a problem that no one really has. Start preventing market fit erosion by grasping a thorough understanding around how and why consumers use your product and the external factors that affect their decisions. If you need expert help, check out our product market fit solution.