The Nitty Gritty of Setting Up Customer Discovery Meetings

David Telleen-Lawton has more than two decades of customer development. This blog post on the nitty gritty of setting up customer discovery meetings is adapted from his presentation at the 2015 Lean Startup Conference.

Talking to Customers is Hard

“I still, after all these years, still find talking to customers the hardest. I always come up with reasons why I don’t have to, why I don’t have to set a meeting.” Eric Ries

This quotes sums up what what I, too, think is the biggest problem in the whole customer discovery process — the whole Lean process for that matter. The natural headwind for reaching out and setting up customer discovery meetings.

Goals for Customer Discovery Meetings

As a reminder, your goal for the Lean process is to get out of the building and learn:

who to call on
how to price it
what the distribution channels are
who’s the competition
your minimum viable product is
what should be in the first version
what can wait to be in the second version

You can collect all that information if you focus first on the problem to be solved (opportunity to be achieved). When you’re meeting with prospective customers, you ask for facts first, you ask about the problems they have, you work to understand the cost of Not Solving the Problem, and THEN you ask for their opinion about your solutions.

Today’s brief talk is all about setting up customer discovery meetings with my focus on two areas. The first, your proper mindset. The second, a few very specific skills and techniques that I’ve found to make all the difference in how effective you can be setting up worthwhile meetings.

We’ll start with mindset. If you’re not in the right frame-of-mind, you’re going to create and discover all sorts of excuses not to make calls. At the end of this talk, I want you to be energized and prepared to make 8 to 12 calls and to set up 4 to 6 customer discovery meetings.

Believe customers are rational

First, you have to believe the customer is rational. Can you imagine that were you to go out, talk to prospects, but then not believe what the customer is telling you? You’d be spinning your wheels — wasting your time. If you really didn’t think they were reliable, then let me try to persuade you.

Consider that the customer is thinking, “If you solve a problem I have, I have time for you, and I’ll tell you what the solution has to be.” They don’t mean they’ll tell you what your product has to be, but what the solution looks like for them. They understand you’re trying to sell a product, and in fact, you should be telling them, “We want your candid answers, because if you say this solves your problem, we’re going to be back here and expecting you to be a customer once we have the product.”

You have to believe the customer is rational, but the implications of that belief are really important. If you’re out in front of a customer that you know has a problem, but they’re not interested, what does that mean? Well, it might very well NOT be a problem for them, or you might be talking to the wrong person. YOU think it’s a problem for them, so from your perspective, maybe this IS the wrong person or maybe there IS some experience that they have that YOU do not have. Data is what I call that experience. If they are rational then that means there’s something hidden on one side or the other. You know they’re rational. You think they want the problem. Must be some data missing.

Be a puzzle master

That leads us to our second thing. You need to be the puzzle master. It’s a game. It’s kind of fun.

Why aren’t these prospects interested in your solution, but these other prospects ARE interested? That’s your job to peel back the onion and figure this conundrum out, and figure it out right then. For example, if you’re on the phone. “Hi, I’m selling a new layer of malware defense. May I talk to the person who’s in charge of your network security?” … “Oh, we’re not interested.” … “Oh, okay, I’ve spent a lot of time in network security, and I know banks spend a lot of money on network security. Is lack of interest because you don’t have any malware on your network or is it because you’ve solved the problem with another product?” That’s what you have to be asking, the more direct the better. Asking right then is important. You don’t say, “Okay, you’re not interested, so I’ll move along.” Then hang up and go on. You can’t afford to do that. You have to be figuring it out. That has to be part of your mindset.

Be surprised early, before development

Lastly, and probably most importantly, is adopting the diagnostic sales — the discovery sales — attitude. As Scott Holt, VP of Marketing at the Conner Peripherals which was for their time, the fastest company to get to $100 million in revenues, said “We’ve reversed the traditional process-design, build, sell. We just sell, design and build and that has saved us numerable problems.” His approach was to adopt this discovery sales model.

Here’s how Frank and I would describe it. We talk to clients and say, “You’ve got a development process. I’m representing it here as slightly overlapping segments in time. When the development group determines they are getting near the end of development, they call in Sales and Marketing to do their magic. I represent this by the sales funnel overlapping slightly with development and then moving forward in time to first customer shipment and revenue. The company is implementing their sales model…Prospect … Qualify, Present, Overcome Objections, Close. This sales funnel has a lot of companies at the Prospect stage and fewer coming out the other end at Close.

Guess what happens when sales and marketing meet the prospective customer? You get surprises. We used to call it “bad news”, but in my experience, it’s surprises. Sometimes it’s good news, but still a surprise. You get some critical feature surprises and inevitably shout, “Hey, development, get back in there!” You work on the product, you fix it up. And if your money has not run out, you finally get first customer shipment and the revenues begin. Hallelujah!

The better way is to climb into the Market Validation Time Machine. This is what happens when you put that sale process forward, overlapping the development process much more. You have that same sales prospect-prospecting, qualifying, presenting, overcoming objections, proposing, closing — you just start a lot earlier, before spending your development resources on the wrong features. It’s like getting in a time machine. You are seeing what your future sales people will see, but it’s a faster process because you are meeting with the prospects with your team of product decision-makers. You are all out in front of the customer. Guess what? You get the same surprises, but when you get them, a whole lot earlier in time, and you now have first customer shipment much earlier because the product’s smaller, because you haven’t wasted time on version two features and you didn’t miss any version one features. You get revenues starting a whole lot earlier, or you find out it was a dumb idea and you fold up shop.

Summarizing mindset, we have talked about the attitude you need to have:

You’re talking to people who are rational. If they don’t understand, maybe it’s something you’re saying or you’re talking to the wrong person, but they will spend time with you if you solve an important problem for them. You have to be the one to figure out what’s wrong and you have to be thinking in sales discovery mode. I’m referring to the professional sales person who asks questions and doesn’t waste time trying to sell to people who don’t have the problem his solution addresses.

Setting Up Customer Discovery Meetings – Basic Skills:

Simple Script

What are the most important basic skills? Just imagine what it is like for the person on the other end of the phone call … they’re thinking, “Who is this person and why are they calling me? What do they want from me?” You’d better answer that question pretty quickly or they tune you out. What you need to do is very quickly create the interest in their problem/their benefit. However, actually what you’re trying to do is get a meeting, not discuss features and benefits. You need to set up some urgency so you can set the meeting up.

At my last startup, LastLine, this was the script I used to set up meetings. LastLine had a new layer of malware defense. Our product detects when malware phones home and would trap it. So, it didn’t prevent malware from getting on a network, but if something nasty somehow got on the network, Lastline would detect the action to communicate back home over the network. We knew where all the command and control sites were and where all the download sites were and watched for anything trying to get to the bad sites.

“Hello, Frank….My name is Dave Telleen-Lawton….I’m part of the founding team of LastLine in Santa Barbara. We’re working to solve the problem that malware sneaks on your network ad servers, no matter how skillfully you layered your network defense. That means you could be losing valuable corporate assets as well as losing valuable corporate resources to fighting this and cleaning up your systems.” Actually after about five of these meetings, we found out no one felt like they were losing corporate assets and so we changed the script. It became, “Our solution will help you sleep at night, not wondering whether malware is lurking on your network.” Then, “We’re in the early stages of product development. We haven’t finished developing our product. I want to know who on your team is responsible for evaluating new network security layers so we can make sure our product addresses your needs.”

That’s it. That’s the script to get the meeting. You don’t want to talk about product. The only thing you want is a meeting. The guy you’re talking to likely isn’t the whole decision-making team. The meeting will be their purchase decision team.

At this point, you pause, you might talk about…. “Oh, I’m not the person. You need to talk to Joe or Sally … ” You have some discussion. “Oh, I’m really interested in this! What do you guys do differently?” “Hey, we have FireEye, what do you guys do differently?” You have an engaged discussion, but not a detailed one. Fairly soon you close out the discussion with: “Do you have your calendar nearby? My team’s going to be with me next Thursday at 10:30 in the morning or at 3:30 in the afternoon. Do either of these work with you?” Of course, the talk about calendar is only if they are interested.

One note: This specificity is what motivates them to ACT. If you say, “Can we get together sometime in the next few weeks?” You will end up trading email messages for the next few MONTHS before you get a meeting.

This very simple script is all it takes.

Start at the top

The second key skill is to start at the top. For B2B products, unless you know exactly who your customer is within an organization, unless you know precisely who buys it and why, you should be calling the CEO or a particular VP.

I don’t often talk to the CEOs. They often have assistants and that assistant, 19 out of 20 times, they do their job well, which is to make sure callers to the CEO get to the right people in the organization. If you treat them like the CEO, 95 percent of the time, they’ll get you to the right person.

You also start at the top because then your referrals are down the chain of command. Rarely is one able to get a referral up the chain of command. Think of the last time you called a colleague and said, “Hey, can you make me an introduction to the CEO?” Usually doesn’t happen, but when you call the CEO, even if you talk to the assistant, “Oh, you need to talk to Sally, who runs operations.” “Hi, Sally. Julie, in Frank’s office, told me I should call you.” That is like a virtual reference and works well. Sally then takes a second to listen to what you have. If it’s not a problem for them, they don’t have time to talk to you. Remember, we want to speak with individuals that have the problem we solve as one of their priority problems. If they don’t have a problem, you move on to the next one to continue to figure out who does have your problem.

Work in small batches

Do not go out and set up 25 meetings. Set up two or three meetings, learn from them and setup a few more with your new information.

Do not work on the presentation until you get a meeting. Other than a half hour with your team figuring out what this presentation should be, you should not be working on the presentation until you have a meeting. Why? You’re wasting your time. You don’t need a presentation until you have a meeting. In fact, you’ll keep working on the presentation and working on the presentation and polishing it up and the product is going to be a little bit more tangible next week, and we’ll have something a little bit better to demonstrate next week. Why don’t we wait a little bit longer before we set up meetings. Instead, you get that meeting set up and now, I’ll guarantee you, you’ll have a presentation by the time the meeting’s there, and you’ll use the product as tangible as it is.

Your first couple of meetings should be with friendlies, people you know that you think have the problem. This allows you to make all the really stupid things in front of a forgiving audience and again learn and modify. There’s trust already which means it will be quicker to get a meeting set (but still only if they have the problem you solve). They’ll meet with you sooner because they know you. That means you get out in the field sooner. They’ll tell you when you’ve said something crazy in your presentation or the obvious mistakes or just things that are confusing.

After a couple friendlies, then your team gets together and figures out with whom the next three or four meetings should be.

Best practice is three to four meetings over two days. It’s hard to get your own people together, so compacting it in little waves allows them to plan around the time. Your meeting is with your team of product decision-makers with the prospective customers’ purchasing and user team on the other side of the table. It has to be all the decision-makers on both sides. Once in a while, there’s a gatekeeper, but there are ways to get the other people in the meeting. For instance, “I can meet with you next week at 1:30 PM.” “That’s great! I’m going to have my CEO and the VP of Product Development with me. Who else would be important to have on your side?” You’d be surprised how quickly a gatekeeper scrambles and says, “Whoa, okay … ” Because they know they don’t have all the answers and you’re bringing in some heavy technical people.

Then, after each meeting wave, you get back in your van to discuss What did we learn? What’s the good news? What’s the bad news? What’s the quote of the day? Who do we want to call on next? Clearly it’s important to all ride to and from the meetings together. After each wave of meetings, you figure out who you want to call on next based on what questions are still open. That’s where you set the next wave of meetings.

I have never, and remember I’ve worked a lot with B2B, fewer B2C, it’s never been more than 30 customers. If you’re only setting a few meetings, iterating, figuring out who’s next, what are still the open questions? It’s typically been, I’d say, 14 to 20, and by then you and your team have zeroed in and answered your pressing questions that drive development of the product features and your sales model.

You might go back to some of these early validation prospects to help determine specific features…or you may go to new ones. You might go back to understand sales channels. Frankly, you can get a lot of that information in this very first meeting. A good customer discovery meeting last an hour and a half. You don’t want to be asking people for 15 minutes of their time. First of all, you don’t want their time. You don’t want to be talking to people whose qualification is that they have 15 minutes to spend with you. You want to be talking to people who have an important problem to solve that you likely solve. In fact, get an hour with them, and it often goes longer than an hour, and because of the the need to build trust, it’s usually about an hour when it starts to get to the hard stuff.

Plan your work and work the plan

In order to get these meeting set, you have to set aside two or three hours in the morning and then two or three hours in the afternoon. You have to do that for a few days in a row and you have to get your team to commit to leaving two days empty, two or three weeks out.

Track of your calls: Who did I call? What did I say to him? When did I call him? When’s the best time? What was his assistant’s name?

I limit my active calls to five to eight. Why? If I’ve got five companies I’m targeting, they likely will go something like this. Call #1: No one answers the phone. Great. Next call, well, the assistant’s there. I do have a conversation. Great. Or no, the assistant’s not there, but he will be back in the afternoon. Okay, I’ll leave a note or I call back in the afternoon. Third call, fourth call, fifth call … Maybe I finally talk to someone. “No, this isn’t a priority for us right now,” or “Hey, we’re going out of business, sorry. It would’ve been good for us.” Were you to have a list of twenty or thirty names, you would just keep going, calling, and just barely scratching the surface. If you only have five names, you’ve got to go back to the first one and you call again. Maybe find a different contact.

I call companies eight times a day to try to catch the person in. I won’t do that for eight days in a row. After the first day, or after about the second or third call, I get frustrated and I try to find out if they have an assistant. I try to find out if they’re on vacation. If you don’t ever get that level of frustration, because you’ve got this long list, you never take it the next level of effort. Ever casually try to reach someone over several weeks only to find out that person doesn’t work in the company anymore? If you’re working a long list, that can happen because you take too long to drill into the organization when no one answers.

In summary, develop the proper mindset. Remember, the people you’re talking to are rational. They’re like you. They’re not going to say no when you’re really solving an important problem.

Adopt the diagnostic sales approach and approach the calling as solving a puzzle.

Use a real simple script. Start at the top. I’ve got lots of stories about that, but … You need to set your meetings in small batches so you can iterate, so your next meetings are a bull’s-eye. It’s not about “Hey, I did 25 meetings,” it’s about, “Do we understand the business opportunity, what it takes to develop it, where the sweet spot is? Do we know who our sales team is going to call next?”

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