Week 2: Customer Development

Week two focused on the customer development process and running experiments.

The Customer Development process, developed by Steve Blank, offers a framework for product development that can feel familiar to designers trained in empathetic human-centered design. (Though Blank uses Customer Development to bring the rigor of the scientific method to the art of starting a company, a scientist’s hypothesize-research-test-iterate process can be similar to a designer’s process.)

Before class, we asked students to watch Blank talk through customer development and entrepreneur Eric Ries discuss lean startup methodology, which offers an engineer’s take on the customer development process.

Blank’s perspective comes from the business side of startups, and Ries’ from the engineering world. Our in-class lecture, given by Giff Constable, gave a product designer’s take on iterative development.

Giff began by re-introducing the process and practice of customer development, using slightly different language. He moved on to an overview of why customer development matters before walking through the types of experiments one could run. His talk was full of anecdotes from what he’s seen and done in Startupland. His slides are online.

And the audio file:

Giff’s talk kicked off a discussion on the tension between testing and inspiration: can A/B testing lead to “the right answer”? Or is “inspiration” – gut, instinct, hunch, whatever you prefer to call it – necessary?

We spent time debating an idea similar to this one from Giff’s blog:

Here’s a truth with startups and new products: understanding test results and root-causes is often really hard. Yet it rarely makes sense to spend the time and money to get statistical significance or perfect clarity. We need to exercise judgement and intuition to interpret results, but that does not invalidate the usefulness of getting outside of our own heads. Sticking one’s head in the sand is not a valid approach.

When I discussed this challenge with my project-teammate Jon Berger, he said, “We test to uncover clues, not facts.”

Overlaid on our conversation was Walter Isaacson’s biography of Steve Jobs; Jobs pretty famously didn’t subscribe to notions of A/B tests, and it seems to have served him well. Yet Jobs is only one anecdote, and we all know the plural of anecdote is not data ..

In any case: it’s important stuff, relevant to technical and semi-technical designers figuring out their places in the product development process, and it doesn’t lend itself to clean answers.

Unbundling Ice Cream

tonyhschu:

An article in Entrepreneur.com chronicled how a couple ladies who ran a gourmet ice cream shop in Seattle closed up their unsuccessful storefront and had phenomenal success selling out of a ice cream truck instead.

I was immediately reminded of the lecture Albert Wenger gave at the Entrepreneurial Design class on unbundling at USV two weeks ago. Albert talked about the nature of the internet - its fundamental traits of being global, instant, free, connected and ubiquitous. Without going into too much detail, Albert argued that the Internet as a new form of information technology disrupts and tears apart previous business models built upon older forms of information technology.

The most discussed example in class was the well known unbundling of the newspapers.  Functions that used to be bundled (e.g. classifieds and the news), under the previous logic of distribution and manufacturing of information no longer make sense with cheap ubiquitous connectivity. The old business model of newspapers was unbundled by the logic of the internet.

The ice cream shop in Seattle, however, isn’t really in the information business. How have they unbundled?  They unbundled themselves from their lease, from their located-ness, from having to staff their store during off-peak hours.

Why is that important? Because operating out of an ice cream truck allows them to go to where their customers are, when their customers desire ice cream. Without a store to maintain, new strategic options open up. They can now show up at community events, festivals, parties - any event that have a high concentration of people in festive moods. Their product is the same, but now their sales-per-hour is through the roof because they are not waiting for foot traffic at the mall, they are pursuing foot traffic on the road.

Operating a food truck is not a new business model. It has been possible ever since they can put refrigerators on trucks. What changed? The arrival of ubiquitous connectivity solved the findability problem selling out of trucks. Pre-internet, marketing and establishing a consistent brand was difficult for ice cream trucks, because they are not reliably in one place, and they had no reliable way of reaching their customers.

Remember how the internet is global, instant and ubiquitous? Food trucks today simply post their current location on a website. Plaster your website and twitter handle on the side of the truck - next time a customer craves your gourmet ice cream, they can just look you up.

In the Entrepreneurial Design lecture Albert called on us to look around in our world, and to identify business model not as natural, but as constructs built upon technological constraints.  Once we start seeing business models as constructs, we can start looking for the seams and joins to understand how these models are put together.  As interaction designers, if we understand our new toolsets, we can start to see how we might pull them apart, and put them back together in new ways.

Unbundling is about recognizing new strategic options as the societal landscape is reshaped by internet infrastructure and internet culture.  Whether this is online, or offline, our opportunities are where the technologies have changed, and the business models haven’t caught up.

This might be fun.

Welcome to Entrepreneurial Design!

Welcome to the official blog of Entrepreneurial Design, a course from the School of Visual Arts’ MFA in Interaction Design program taught by Christina Cacioppo and Gary Chou.

The purpose of Entrepreneurial Design is to provide a time and space for students to think broadly about what they aspire to create and how they will do so.

The course will focus on three things:

1. Understanding the current context in which we live.
2. Developing and sharing your opinions.
3. Augmenting an interaction designer’s toolset.

All three areas are relevant whether a student’s end goal is to be an Etsy seller or a founder of a tech startup; whether they plan to raise money from venture capitalists or Kickstarter’s community; whether they want to have social, cultural, or economic impact – or all three; and whether that impact’s scope is global or local.

Check out the class syllabus and the assignments. We’re using SoundCloud to record talks by our guest speakers and will be posting many on this blog.

One of the more exciting aspects of the course are the students themselves. They’re designers with backgrounds as graphic designers, technologists, architects, artists, scientists, and musicians. More are female than male. Most have perspectives that are informed by cultures outside of the US.

This course is an experience and a journey, and as instructors, we are excited to see where the students take us.