How to build a SaaS business starting from the Customer Research until the launch of the MVP in the market
A personal experience about product management from scratch
The idea has come up during a meeting with a franchisor owner that was explaining his communication issues between the headquarter and franchisee points. Once exposed all the information, he asked us how to solve that pain points; the solution proposed was a consultancy contract to guide the marketing team to communicate faster and better using the right products in a guided and structured process that aims to engage using right channels the franchise owner or store manager.
The proposal was based on a strong roadmap that provides a training program on this product and the new process to implement in the company.
I went deeper into some market insights to avoid common mistakes and I find interesting insights about the franchising growth in Italy and the common problems found in our client too.
The scenario including dynamics as a fast access to the business world faster investing with a discrete amount of investment. Arising the old state or “stable” job is crumbled really fast in the last 10 years which ensured a future for young graduates.
Hard communication in franchisee network
Franchising network is growing fast, breaking the local market with product pricing strategy and their brand awareness driven from experienced marketing managers. Today audience is influenced by social network local ads and influencer driven for the most, local promotions and a good communication vocabulary adapted to different kind of audiences.
Market research shows that Italian urban centers will increasingly be composed of franchising networks. The small shop owners was known by most of the local community, now they are at the mercy of the waves due to their incompetences to adapt in the new way of communicating and different purchasing dynamics.
Allow the franchisee to manage, create and monitor his brand reputation online.
The product was born to solve the communication gap and allow the automatic planning management of online contents, on different channels, through machine learning algorithms. We also thought about the importance of acquiring profiled and local leads in a simple way to increase the retention of the local franchisee point.
Based on the concept that a strategic marketing approach focused on creating and distributing valuable, relevant, and consistent content to attract and retain the local customers drives profitable revenue in the long tail.
The Roadmap — Create the plan!
Before start defining the prototype, I went deep in market shares, entry barriers, competitors and the last not the least what customers really want.
I avoided to start in a wrong way proceeding blindly, it’s the first fundamental step to be able to understand how to build the business in the right way and define the right product roadmap respecting the real needs of potential customers.
Before start prototyping, you need to figure out what information is crucial to begin designing the product.
The main goal that we figure out is to solve the franchisor network pains creating a solid business model through a simple solution that really solve the pain that affects the potential customers.
The phases I followed:
- Hypothesis phase
- Market Analysis
- Business Model Canvas
- Let’s start create the MVP!
The first phase is to start from the evidence and hypotheses that I thought could solve problems that I perceived as a problem, but not being a Franchisor or a Franchisee owner I necessarily needed a feedback from the right interlocutors.
So I proceed in this way:
- NFB Tables
- User Research
- Hypothesizes the journey
- Magnitude / Frequency
- Refine Ideas
Creating the Needs, Features and Benefits table by answering the question “What kind of problem does this idea solve?”. I filtered all the ideas in order to identifying 3 main solutions for the pains that I thought could be solved using the product.
The sales department organized short meetings with franchisors and franchisees through a phone call, hangout or face-to-face. This led to the modification and validation of some hypotheses defined in the NFB table.
This phase allowed us to really understand where I need to focus on and what are they thinking about their problems; moreover, I got some demographics information in order to design Personas better (such as age, gender, and income level).
The research got us data for well understand how they actually solve their problems and with this information we have focussed on to build a useful product, that they’ll use every day for real.
With particular attention we have chosen our sample, identified thanks to market research, found online and partly purchased. The sample choice is not an aspect to underestimate because the margin of error and confidence level allows you to understand how reliable the results of the answers are.
- How sure do you need to be that the answers reflect the views of your population? [Margin of error]
- How sure do you need to be that the sample accurately samples your population? [Confidence level]
You can focus on this topic on the Survey Monkey website, which is a great product that allows you to send surveys to a defined demographic audience.
Over hundreds of Italian franchisors answered the questions and I found an absence of internal direct communication channels has been noticed, which allows a more fluid and controlled communication towards the franchisor’s customers, both direct and local. Moreover, the Franchise are usually going to communicate in a “tailermade way” the “Brand voice” to local customers, and all the promotions are spreaded in different way and not always just in time.
Hypothesizes the journey
Designing the journey of those who use the product allows us to understand the activities that will take place when and how it’s used in the daily routine. On the one hand, there is the Franchisee and on the other the Franchisor team that will have to send suggestions and promotional material.
Hypothesizes Magnitude / Frequency
The frequency of the activities to be carried out to Franchisee takes place ones or twice daily. The importance / weight of the problem we are solving, covers an aspect concerning time, organization and it has an impact on business. These are all important for all stakeholders involved.
After the User Research and the Hypothesis phase, I have had to review the ideas to refine better and correcting some propositions. I’ve listed all the pains that could be perceived for, our potential customers, from the difficult one to the simpler.
During this phase I got a lot of information about different business areas:
- Market segment and shares
- Entry barriers
- SWOT analysis
- Competitors: their marketing, product features, and subscription tiers
- Market trends
I explain the condensed version here.
During the analyze of market researches, I analyzed a strong incidence of social media use in the consideration phase of customers before buying a product: R.O.P.O. (Research Online and Purchase Offline).
It was (and it’s actually) a growing trend mainly due to social-demographic attitudes and behavioral patterns evolved.
A mainly young public adopts a R.O.B.O (Research Offline and Buy Online) buying behavior, where there is evidence of purchasing convenience in terms of pricing or purchasing experience.
Some sources used, such as PWC Total Retail, showed interesting buying behavior, on a sample of over 23,000 consumers in 25 countries; the data refers to the Italian national market.
In the following link you can take a look of some resources that I used to do market research:
If you’re interested in the last consumer’s report, you can read at this link some detailed information updated to the last year.
The Business Model Canvas
The business model creation is a very delicate and crucial aspect for all kind of startup and business; understand clearly what can be the Key Partners, Activities, Resources, Channels and so on, it solves a lot of common mistakes generated by the blindness and activities out of business scope.
This was the first BMC v0.1 that developed internally with the team, in order to clarify to all parts of the company, the business key points and create a marketing strategy for the launch.
I usually use the framework AARRR to monitor the business KPI in order to keep the focus on some marketing actions: by clicking here, you can find an article that I published, where I explain how to use it, through some examples, and a downloadable sheet template to create your own.
Unique Value Proposition
The goal of this important step is to discover and validate the way we’re building the product and the problem/solution fit.
By the way, after some different brainstormings, we craft the product Unique Value Proposition:
Simplify internal and external social Brand content marketing, in real-time
It’s crucial to define the UVP because it must represent the differentiation with the other competitors and communicate our value for customers.
Achieving the Fit through Value Proposition Map
The goal of the Value Proposition Canvas aims to create a great value propositions that match our customer’s needs and jobs-to-be-done and helps them solve their problems.
Identify our customers is the key aspect of the business, priorities changes depending on the customer’s context.
The Personas it’s a method to aggregate behavioral patterns, demographics data, and some other information about an archetype customer. This information is the basis for a well understanding about their journey, the touchpoint and what are their interests in order to communicate end-to-end at the right time in the right channel.
I define their pains, gains and jobs to create the Value Proposition Map that I explain, here, in the following:
— Franchisor’s Marketing Employee
- Difficult communication by email with all Franchisee network
- Delays in the answers and not always Franchisee give feedback of received message
- Franchisee’ employees not always are available to engage customers through marketing actions in store
- Grow up the interactions in terms of answers and feedback with Franchisee points through an easy notification system on devices
- Coherence with Franchisor communications in all Franchisee points
- Improve the customer experience in-store
- Communicate with Franchisee’s Store Manager using phone or emails promotions, technical issues or internal information
- Communicate to local customers promotions
- Create local events
- Communicate visual merchandising for the new collections
— Franchisee’s Store Manager | Franchisee’s Social Media agency
- Content creation support for the social channels on local audience
- Impactful content for their audience
- Understand and know just in time in-store promotions
- Communicate effectively following Franchisor’ guidelines
- Ready-made content to post or agency for communication support
- Sending report of local selling results by channels, concurrently on Franchisor marketing campaigns for new collections or promotions
- Tool that allows fast acquisition of customers in the store
- A coherent visual merchandising with Franchisor’ guidelines
- Manage employee activities for a better in-store customer experience
- Manage trouble situations because of some complicated customers
Now, we know what customers wants: let’s create the MVP!
Once we have covered some gaps in our business model and product features thanks to our analysis, we’re ready to start!
Based on some User Stories defined in the analysis phase, I create the sprint backlogs for 4 months. The roadmap planned made us able to deploy in time the MVP. I choosed to use BUC method prioritization for backlogs in order to serve the business needs during and after product launch. In the platform there’s a live chat support for fast feedback and solutions to drive the retention, time in platform and stay tuned on the first issues.
Some screenshots of the Minimum Viable Product launched: