Rahul Vohra’s talk about how to create a product market fit survey for the Business of Software conference was one of the standout speeches of recent years (against some very strong competition).
Rahul is the CEO of the email productivity tool, Superhuman. As he was struggling to scale his SaaS startup, he read about an approach championed by Dropbox’s Sean Ellis; he describes how it’s actually pretty hard to know if you have achieved product market fit, or PMF.
Ellis argues that many of the indicators we rely on to understand if PMF has been achieved are actually lagging indicators, and that he favoured creating a leading indicator by asking the following question:
“How would you feel if you could no longer use this product?” with the 4 possible answers being, “very disappointed, somewhat disappointed, no longer use, not disappointed.”
Ellis benchmarked 150+ companies using this question and found that where the percentage of respondents who rated themselves as “very disappointed” was 40% or more, those companies were growing and getting traction the most easily.
Taking Ellis’s approach, Rahul carried out the survey and found that only 22% of his customer base would be “very disappointed” if they couldn’t use Superhuman any more. Clearly, he concluded, they were nowhere near PMF back then.
But instead of being disheartened, he looked in detail at the 22% to find out why they loved it and sought to understand them better so he could find more customers like them.
This was the key really – not seeking to broaden the product’s appeal at this point, but rather finding MORE of the people who already loved it.
In his talk, Rahul underlines the finer differences between some level of traction and actually experiencing ‘real’ PMF:
It’s perhaps Marc Andreessen who has the most compelling, most vivid definition [of Product Market Fit] that I’ve come across. He says.. ‘you can always feel it when it isn’t happening. Your customers aren’t quite getting value. Usage isn’t quite growing. Word of mouth isn’t spreading quite fast enough. Press reviews are kind of blah, sales cycles take too damn long, but you can almost always feel it when it is happening. Customers are buying as fast as you can add servers. You’re constantly hiring for sales and support. Reporters are constantly calling you. Investment bankers are staking out your house. You just got Company of the Year award from Harvard Business School’. It’s certainly a vivid definition and one that I was staring at through tears in the summer of 2017. It seems so subjective, so unactionable. What do you do if by this definition you don’t have Product-Market Fit? Indeed, can you measure product market fit?
Vohra goes on to underline the importance of understanding customers’ real needs, rather than just their stated ones.
Customers are notoriously good at not being able to express what they need. They might ask “does your software do this” for example, when actually they are trying to solve an entirely different problem in their business.
‘How can you get close to that?’ Vohra asks. How can you understand what customers are really trying to do? And through the PMF survey approach, Superhuman’s framework for understanding product market fit was born.
Ellis and Vohra call it a Product Market Fit Engine, and it has 5 stages:
- Survey your users
- Segment those users
- Analyse what they said, why they love the product and find out what holds them back
- Decide what changes you’re going to make as a result of their feedback and input
- Implement and track those changes
Vohra used a similar approach to the above, and then went on to ask himself, “what could be done to increase the number users who’d be very disappointed if they couldn’t use the product? By focusing on the customers who completely loved Superhuman, Vohra brought in the concept of the “High Expectation Customer” – essentially the most discerning person in their target market. He then went on to seek out more of them and proactively target them.
If this approach sounds good to you, and you want to get more feedback from your own customers about whether they enjoy using your product, we can help.
With its traceability back to individual users and its built-in alert system, Customer Thermometer is ideal for product market fit surveying.
Here’s a little example of it in action:
This approach makes it easy to source product feedback from users, and has the additional benefit that custom fields can be brought through and easily segmented to identify the types of users falling into each section.
Try Customer Thermometer for yourself, send yourself an example now. We can make a PMF survey part of your CRM, marketing, ticketing and workflow interactions: