Understanding customer behavior is crucial when embarking on a new venture or developing a new product. It serves as the fundamental element that holds your business model together. Neglecting the time and effort required to comprehend your customers’ objectives and the behaviors necessary to achieve those goals can jeopardize the success of your venture.
In a previous post, I discussed how innovators can define customer outcomes by exploring what customers aim to accomplish and how they seek to enhance their journey toward specific goals. Additionally, we delved into the challenges they face while striving for these achievements. This article aims to provide a more comprehensive understanding of this topic, equipping innovators with a methodology to identify the essential behaviors needed to attain specific outcomes. Following the behavioral thread, you can navigate the entire process, from early opportunity framing to customer discovery and product design phases.
The Behavioral Thread
When creating a new venture or product, understanding customer behavior is crucial. It is the foundation that underpins your entire business model. Without taking the time to understand what your customers are trying to accomplish and the behaviors necessary to achieve those goals, you risk launching a product or service that misses the mark. Customer behavior becomes the thread that weaves through your venture development process.
Opportunity Frame. In a behavior-focused design, it’s essential to understand what your customer hopes to accomplish. At the highest level, you want to consider whether the customer expects to solve a problem, fulfill a need or want, or achieve a specific task, job, or goal. Once you have framed the opportunity in one of the above areas, you start considering the details. At this point, you want to define what the customer is trying to do and in what context. For example, where does the effort occur if the customer attempts to accomplish a specific task? At work, home, school, etc. Next, you want to identify any obstacles or challenges the customer experiences while performing said job. An opportunity statement’s final element is defining specific and measurable outcomes. In other words, how does the customer see success, and how can it be measured?
Identifying the Key Behavior. The real challenge lies in Identifying the required behaviors for most innovators and product designers. Decoupling the customer’s desired behaviors from the innovator’s product vision can be difficult. However, this is a critical step in ensuring product success. By aligning these two behavioral requirements, you can create a product or service that meets your customers’ needs and fits your overall business strategy.
You must stay hyper-focused on the customer’s behavior at this early stage. You cannot allow your early conceptions of a product to bias your view on key customer behaviors integral to achieving desired outcomes. Later in the discovery phase, as you validate key customer behaviors, you can consider what your product has to do to enable said actions. The subsequent product design will elicit product-driven behaviors that facilitate key customer behaviors. In other words, the customer must act a certain way to use the product. These actions lead to the required vital behaviors leading to the desired result.
For example, let’s say you are developing a new app that helps people track their daily water intake. To ensure the success of your app, you need to understand the key behaviors necessary for users to achieve their goal of staying hydrated. During the discovery phase, you learn that customers seem to forget to drink water throughout the day because they are attending to their busy schedules. As you know more about your active customer, you may discover that even when they have easy access to water, they forget to take a sip. As is common in these situations, the customer intends to stay hydrated, but something is getting in the way of the necessary action. In this case, a busy schedule. Once you identify current behaviors and barriers to acting, you can begin to consider how to design an intervention. By aligning the functionality of your product with the key behaviors necessary for success, you increase the likelihood that users will continue to use and benefit from your product.
Discovery Phase
As you engage your early customer, you seek to validate your assumptions about the customer’s desired outcomes and key behaviors. Then, from a behavioral perspective, you want to collect information about the customer’s current behaviors and actions as they attempt to achieve a desired result. At this point, it is essential to remember that there is a difference between what the customer says that they do and how they behave. The reasons for this disconnect vary, but I typically find that customers don’t understand the relationship between their intentions and actions. For example, I want to drink more water daily, but any tracking data shows they are not achieving this goal.
Identifying Customer Profile & Persona. Developing a customer profile involves comprehensively understanding a target audience or consumer segment. By analyzing their demographics, behaviors, preferences, and needs, innovators can effectively tailor their products, services, and marketing strategies to meet customer expectations. Associated personas are fictional representations of specific customer types within the target audience, helping innovators to visualize and empathize with their customers. These personas encapsulate key characteristics, goals, behaviors, motivations, and pain points of individuals, aiding in crafting effective interventions and experiences leading to desired outcomes.
Defining the target customer profile and persona helps establish key behaviors essential to generate the desired outcomes. Innovators should highlight critical behavior in their profile descriptions, providing observable manifestations of these behaviors. The persona can illustrate a representative example of how the necessary behavior presents itself in the context of the customer’s goal.
Behaviorally-Focused Maps. During the customer discovery phase, you want to create interviews and surveys that facilitate discussions around actual behavior. You can still run into the above issues, but in-depth probing can help to assess actual behavior. Here, you are looking to be “uncomfortably” specific as you identify the critical behaviors that the customer currently manifests to achieve the stated result. To achieve the required level of specificity, make sure to answer who, what, and when – So who is doing what and when. You will want to specify this information for every behavior or action involved in achieving the desired outcome. To support the level of specificity required to follow the behavioral thread, you will want to create a behavioral map illustrating how each behavior leads or attempts to achieve the desired outcome.
A customer behavioral map is a tool that helps founders understand the various stages a customer goes through as they attempt to solve a specific problem or achieve a particular goal. The mapping process allows founders to better understand the customer’s perspective and identify areas where a product solution may meet their needs or deliver the desired outcomes. In addition, creating a behavioral map early in the venture development process can help founders identify potential enablers and barriers that may influence the customer’s behavior and inability to achieve the target goal.
As part of the early discovery phase, I have founders build a map illustrating the customer journey and the different touch points as they try to achieve the stated outcome. What they do at each phase of their journey is critical for a specific target customer if you focus on their behavior. The journey phases depend on the real opportunity and context in which the customer is experiencing the issue. Phases can be specific steps to achieve a goal or periods along the journey. Once you decide on the phases, you want to list what the customer is doing at each stage. While you want to brainstorm all associated actions, you will look for essential behaviors critical to achieving the desired result.
Additionally, as you follow the key behaviors, you will want to list any factors that support or create obstacles for the customer to manifest these necessary actions. Enablers and barriers are factors that can facilitate or hinder the performance of a specific behavior. In behavioral science, enablers and barriers can refer to various factors, such as environmental, social, cultural, cognitive, or emotional influences. Identifying and understanding enablers and barriers can help inform the development of effective interventions to promote or change behaviors. By addressing the specific factors that enable or hinder a behavior, interventions can maximize enablers and minimize barriers, thereby increasing the likelihood of behavior change.
Behavioral mapping allows founders and designers to identify specific behaviors and pain points that customers may have at each stage of the journey and can help to inform the development of the product or service to enable key behaviors and eliminate or minimize obstacles along the way.
Behavioral Data Collection and Analysis. Interviews with potential customers can help founders understand their needs, behaviors, and pain points. This information helps o prioritize which outcomes are most important to customers and what behaviors are involved in the process. For a general discussion on customer interviews & surveys, check out Customer Discovery: Early Interviews and Customer Discovery: Surveying Early Customers. Generally, founders should start with in-depth, semi-structured customer interviews.
In some cases, founders may want to expand the number of interviews by organizing focus groups. Focus groups involve bringing a small group of representative customers together to discuss their needs and desire. Innovators can use the information from these groups to prioritize customer outcomes. Once you have interviewed many target customers, you can consider using survey methods to collect more data to support and validate customer behavior and preferences patterns.
Determining what behaviors are most important to the customer outcome can be challenging. There are several ways to solicit information in a non-biased manner. A few special interviewing techniques work well when focused on behavior. One such method is called contextual interviewing. The focus is on observing the customer while tackling the task at hand. You watch them step-by-step and ask questions to understand their behaviors. This method is especially good at capturing behaviors they are unaware of. When customers behave in the moment, they tend to provide details they may overlook when discussing retrospectively.
Coupling observational or ethnographic methods help you to Immerse yourself in the context you want to understand by spending time with the people involved. For example, you can gain a more in-depth understanding of why people behave in a certain way by observing their behavior, engaging in conversations, and documenting their experiences.
Design Phase
Benefit & Feature Prioritization. Once you have identified the essential behaviors that customers must exhibit to achieve the desired outcomes, you can design a product that will enable these behaviors. Once you understand what the customer must do, you can develop a product with attributes allowing essential behaviors. As discussed earlier, the design process prioritizes product benefits and features. A product benefit is a specific way in which the product or service helps the customer achieve their desired outcome or solves a problem they are experiencing. Product benefits enable the customer to accomplish specific, measurable results. Features are specific characteristics or attributes of the product that will allow a particular advantage. Features describe the technical aspects of a product and how it works. While features describe what a product does, benefits describe how it can help customers achieve their goals or solve their problems.
When designing early product tests, you must prioritize the features that will facilitate the essential behaviors. At this point, you want to choose the minimum set of features to provide the desired result. Therefore, one of the prompts we have founders consider is what product attributes will contribute to shaping specific new habits/behaviors of importance to the customer.
Testing & Iteration. Once you decide what specific features you want to test, you can select the MVP approach that best fits the current state of development and determine what target customers will participate in the trial. Founders should continuously test and iterate the MVP to ensure it effectively encourages the desired behavior. These iterations can involve user testing or running A/B tests to identify the most effective design choices. A crucial element of testing is providing the customer with behavioral feedback.
Behavioral Feedback Loop. The MVP design should also possess a feedback loop that provides users with immediate feedback on their behavior. There are several essential benefits to including behavioral feedback with each iteration.
Feedback loops allow customers to receive information about the consequences of their actions or behaviors. Positive feedback reinforces desired behaviors and encourages customers to continue engaging with a product or service. Negative feedback highlights areas for improvement and guides customers toward more desirable behaviors. This reinforcement and learning process helps customers understand their actions’ impact and make informed decisions.
Behavioral feedback plays a vital role in behavior modification by creating awareness and prompting behavior change. When customers receive feedback on their actions, it triggers a reflective process that encourages them to assess their behaviors and make necessary adjustments. By providing feedback, innovators can guide customers toward behaviors that align with their goals, values, or desired outcomes.
Finally, feedback can boost customer motivation and increase engagement. Timely and meaningful feedback acknowledges customers’ efforts and progress, instilling a sense of accomplishment and satisfaction. Positive feedback can also serve as social validation, fostering a sense of belonging and encouraging customers to continue participating or using a product or service.
Summary
Understanding customer behavior is crucial when developing a new venture or product. By aligning offerings with customer needs, entrepreneurs increase their chances of success. The process involves framing the opportunity, identifying key customer behaviors, and collecting data through customer profiles, behavioral maps, and data analysis. In the design phase, prioritizing benefits and features that enable essential behaviors is critical. Testing, iteration, and incorporating a behavioral feedback loop refine the product and drive behavior change. Leveraging customer behavior is critical for success in ventures and product development.
Get a copy of Patterns of Entrepreneurship Management, 6th Edition, for more on this and other entrepreneurship topics.
If you enjoyed this post, subscribe to the Venture For All® Newsletter with exclusive video commentary by Dr. Jack McGourty.
Facebook | Instagram | LinkedIn | Twitter
© 2023 Venture for All® LLC. All rights reserved.
Venture for All®️ LLC 