Template: Use product discovery and avoid flawed developments

Meet customer requirements by using the right product discovery approach

It all starts with a great product idea that needs to be implemented as quickly and cost-effectively as possible. This traditional method all too frequently results in seemingly promising product concepts that turn out to be a flop in the market launch phase, particularly if they miss the mark in terms of buyer needs. The product discovery method makes it possible to avoid precisely that problem.

Why use the product discovery method in the product development process?

Many development departments are still guided by the belief that they know exactly what their customers want. With this standpoint and self-defined criteria, a product’s chances of success are only estimated and the idea goes straight into the implementation phase. However, whether the product is actually marketable can only be determined after the launch. This approach comprises both a financial risk and wasted potential. After all, the real challenge is not to implement a product as quickly as possible, but rather to first and foremost establish whether the idea behind it is genuinely meaningful, feasible and profitable. This requires a new mindset that moves away from a project-focused perspective and concentrates on customers and their needs.

Free test template for your workflow!

Product discovery can involve numerous tests. Our test template serves as a practical aid for this, helping you formulate precise hypotheses for the product discovery process, define data sources, and clearly analyze and document test results.

Product discovery: step by step to a successful product

For a product to be successful, it must satisfy real needs and offer solutions to problems that actually exist. As a product development method, product discovery focuses on exactly that. The key here is to gain an in-depth understanding of the target markets and buyer groups and form a product concept on that basis. During the initial stage of product discovery, there is therefore no specific concept yet. The product idea is developed on a step-by-step basis and is deemed flawed until extensive tests prove otherwise.

What is the aim of the approach?

Product discovery should help to answer the following questions:

• What problems and needs exist in the target markets?
• What buyer groups have those problems and needs?
• What product idea can solve those problems?
• What requirements indicate the need for a suitable product in the target markets?
• How can a relevant product be implemented practically and cost-effectively?

Every aspect of an emerging product idea is reviewed and continuously adapted based on these and other questions. Individual features and details are only set in stone when a real customer benefit can be verified by means of tests. The aim is to create a minimum viable product, meaning a product that meets the minimum requirements to be successful on the market. For this, it must be

• beneficial, useful, and able to solve a problem that actually exists,
• practical and easy for customers to understand and utilize, as well as
• viable and capable of being technically and financially realized in the designated timeframe.

Product discovery in practice

Product discovery follows an iterative approach and never a linear process with fixed deadlines. Although individual sprints are incorporated, by the end of which a new test result must have emerged, it’s not about producing a product concept by a certain point in time, but rather to gradually filter out the best possible solution. The name of the game is test, test, test. Product managers should never go with their gut instinct when presenting arguments, but instead should validate every assumption with solid data.

Develop ideas, hypothesize, test, and repeat

One or more hypotheses must be formulated for every relevant product aspect and then validated by means of tests. If the hypotheses do not prove correct, the idea is adapted. Finally, iterative tests are conducted until the data shows that the product would genuinely be worth implementing. For example, findings from customer surveys, benchmarking measurements, trend analyses, and focus group tests can be used as a data basis. Data from the marketing, sales and customer service departments is also important.

Tip: When repeating the process, you should never change too many variables at any one time, because that often makes it impossible to see which variable may have brought about a significant change.

Create better solutions using product discovery

The major advantage of product discovery is creating product ideas that have the best possible chance of success, instead of using up budgets on unsuccessful product prototypes. This approach opens up new perspectives for product managers. By incorporating aspects from the target markets right at the outset, you can obtain important input and thus develop completely unique ideas. Continuous testing also allows you to verify whether your own conclusions actually have a practical value.

To conclude, starting out on the product discovery path requires a lot of work initially, because only a small amount of valid knowledge is available at the beginning of the process and a lot of testing is required. However, solid findings accumulate from sprint to sprint. If nothing else, they build a valuable pool of experience for other and future projects.

Tip: Get even more incentive to use agile processes in product management by reading our article: “Recognizing and capitalizing on potential: Agile processes in product development”.