Lessons on Product Market FitThis post was contributed by MEST Class of 2019 EIT Kayode Daniel. Kayode is the Community Manager of Product School in Accra. He is passionate about all things Product Management and has his eyes set on building products people love.
The first ever Product School Meetup in Accra was held last Saturday, February 2nd at the MEST Accra Incubator. The event saw design thinking experts, software developers, CEOs, product managers, and product enthusiasts of three nationalities gather to gain insights on Product Market Fit (PMF).
Nana Kwabena (Kobby), represented Leti Arts at the meetup. He described the journey of Leti Arts from inception and how they’ve been able to navigate the nascent gaming industry in Africa
He emphasized the importance of collaboration in Leti Arts in its early days through today. Collaboration with skilled and passionate people was a critical ingredient that allowed them build their first product.
Prior to launching the product into the market, they focused a lot on building the product and had very little budget for marketing. There was a lot of PR buzz around it and excitement in the community and the expectations were very high. However, the unexpected happened when they eventually launched. User adoption was very low and they didn’t make enough money. The product was good but they had targeted the wrong market.
As he narrated, there was a general consensus that goodwill and PR are nothing but vanity metrics in the grand scheme of things.
Many times people may like your product and encourage you but won’t find it valuable enough to pay for the product.
An entrepreneur asked what they would have done differently if they could start all over again, to which he responded - research. Had they focused on trends and user needs and not assumed the power of goodwill in developing their first game, they would have made more impact, got more downloads and earned more revenue.
A second question led to his second critical point — untested assumptions will get you into trouble. Entrepreneurs are guilty of staying in their cocoons and building products without talking to their customers. This was the path the Leti team took in the early days as well, but learned quickly and improved. Genchi Genbutsu is a term called “Get out of the building”. If they go out often to ask customers for feedback, they will discover pain points that will help them in determining what to build.
The third and perhaps most important point was the need to be nimble and adaptable. Over the last few years they’ve had to expand into other areas other than games creation. Consulting and education have gone on to become critical pillars of Leti Arts. Consulting was birthed as a result of listening to customers.
Publiseer’s Chidi Nwaogu tells us how to extend customer lifetime value
Chidi Nwaogu (CEO, Publiseer) started his talk by using a popular acronym - LTV, which originally stands for Lifetime Value - to explain 3 pillars he considers most important in creating products that fit the market. However, in his dictionary LTV means Listen, Team, Value.
LISTEN — Chidi reiterated Kobby’s initial point. Often times, founders create products for themselves only and because they (founders) don’t represent the people they’re building for, the product fails woefully. Sometimes even when they listen, it’s with a lot of bias.
It’s always important to leave your bias at the door before building anything.
Founders fall into the trap of falling in love with their solution and not the problem, and as such are not quick to make changes when the feedback is not positive. Sometimes they use the quote, “If I had asked people what they wanted, they would have said faster horses.” This is attributed to Henry Ford to justify the sometimes closed mindedness of customers’ wants and needs.
TEAM — While a good idea and a mediocre team never works, a good team with a mediocre idea stands a better chance, and this is because the growth of a product is directly related to the people behind it. One needs to work with people who complement each other’s skills and not just friends. It is also important to have people that are in love with the problem and not just the solution. The solution thought out in the beginning may change a couple of times during the process, and it is important to not be stuck on any solution too closely.
VALUE — The idea for Publiseer came as a result of problems Chidi and his twin brother encountered. Being professional writers and singers, they found it expensive to publish their content for the global audience. They then thought to explore the problem further, and behold Publiseer was born.
Prior to that they published the mockup idea on a now defunct forum , which had a lot of early users open to trying out a product and giving feedback that is blunt and direct. They iterated and launched the product which was well received.
Chidi mentioned their growth so far is a result of multiple factors, some of which include their obsession with customer feedback, team synergy and observation of trends.
Chidi noted that revenue and profits alone do not guarantee one has attained fit. Other metrics such as the CAC:LTV ratio are more important. How much does it cost to acquire a customer (CAC) vs how much does the customer spend on the product during the time they are customers (LTV)? Retention is also a very crucial metric to consider when considering PMF.
We understood PMF is a long arduous journey and a moving target too. It is dependent on a number of external factors such as policies, technological advancements, new players and in rare cases oddities.
In conclusion, “Do whatever is required to get to product market fit. Including changing out people, rewriting your product, moving into a different market, telling customers no when you don’t want to, telling customers yes when you don’t want to, raising that fourth round of highly dilutive venture capital — whatever is required.” (Marc Andreessen)
Interested in learning more at the next Product School Meetup, keep up to date on their upcoming events here!
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