How $375 and Craigslist Saved Me Months of Customer Development

Summary: Steve Blank and others advocate having lots of face-to-face interviews with potential customers. While this approach yields the best possible insight, it also takes a lot of time to get introductions and meet people, particularly for those with a day job who are working part time on their startup. I’ve used Craigslist to successfully recruit candidates with Amazon gift cards and quickly got insight into whether my initial idea had merit. In this post I explain how to do it and share a job template to help you get started.

Face-to-face Interviews: Most Insight, Longest Time

In keeping with my promise to write more how-to Lean Startup content in 2013, here is a quick hack you can use to expedite Customer Development on Craigslist.

Steve Blank advocates face-to-face interviews with potential customers and I fully agree with this approach – it has been my most effective tool to get true market insight and recruit early customers. Unfortunately, as anyone who has actually tried it knows, it can take an enormous amount of time to find customers to talk to, setup face-to-face meetings, and collect everything to get insight.

If you’re working a day job and trying to squeeze interviews into evenings, weekends, and lunches, it can take weeks and months to even get initial insight.

Fast Initial Insight with Craigslist

The basic idea is to post a job on Craigslist offering a $30 Gift card in exchange for 30 minutes of market research.

Pros:

  • Quickly get a lot of calls scheduled
  • Schedule and batch calls when it is convenient for you
  • Candidates will do a lot of the grunt work

Cons:

  • Costs a few hundred bucks
  • REALLY easy to get bad information if you ask the wrong questions
  • Few opportunities to recruit actual customers.

Case Study Example – Health Savings Account (HSA) Management Tool

A few years ago I started researching startup ideas around a relatively new but growing consumer financial services product – Health Savings Accounts. The details don’t matter, but after a few weeks of research and discussions with industry experts I thought there would be a need for an application to manage the tedious tax components of HSAs.

I tried getting introductions but quickly realized that most people in my network didn’t have HSA accounts. And even when they did, it took a lot of persuasion to get people to meet and talk about it.  After a few weeks I knew a bunch of theory, tax law and policy but next to nothing about how consumers used their HSAs. My next option was to try to start reaching people through corporate HR channels; having tried this before I knew it was a long, long slog.

I realized I needed a faster way to get an initial market signal – did anyone at all care about my idea? So I turned to Craigslist and got my answer.

New Gmail Account

I got a new Gmail account at HSAResearchFirm@gmail.com or something like. Why a new email account is useful:

  • The “Research” name adds more credibility
  • You can use the new calendar to get candidates to schedule calls.
  • You don’t give crazy people on Craigslist your email account or name.

Craigslist Job Ad Copy

After testing various options, I got best results from:

  • Emphasizing we were a startup working on a new product idea – attracted smart people.
  • Making the expectations, dates and times clear.
  • Asking open-ended qualification questions, e.g. “Email us and tell us why you would be a good candidate.”

While I don’t have the original ad copy from this project, here is an example you can have .

Post in Jobs – > ETC (et cetera jobs)

Craigslist has some free options to post jobs. Unfortunately my – seemingly rather civil – posts kept getting flagged and pulled.

After wasting a few hours I ultimately it was just easier to pay the $75 and post it to “et cetera” jobs.

Create Interview Slots

Next I opened up my new Gmail Calendar and blocked out slots in times that were convenient for me in 30-minute intervals. Here are instructions on how to do this.

Managing Responses

I waited until I had about ~50 responses before even looking at them. After deleting ~50% who obviously didn’t even read the ad I identified about 15 that looked like they could provide good insight.

Some of the responses were so detailed and informative that I was already getting answers to my primary questions. I responded to the top 15 and sent them instructions. About 10 followed-up and picked times.

The Customer Development Calls

Previously I had made the mistake of asking False Positive questions on this project. I learned that because all of the people – even those who felt interested and personally connected to the project – were very motivated to get their $35 Amazon Gift Card and would tell me whatever they thought I wanted to hear.

This time I stuck to the script and tried to get to a few simple answers based on how these consumers behaved today.

The Results: They had No Perceived Problem

After 5 calls I had a good sense that I was on the wrong track, and after 10 I had seen exactly 0 encouraging signals to get me excited about pursuing the project.  I’ll spare you the details, but it was clear that all of my problem and needs hypothesis were way off track.

While I didn’t get then answer I wanted, using Craigslist got me to the truth months sooner than my initial options.

New Alternative:  TaskRabbit

My friends at Spotsetter have successfully used TaskRabbit to perform similar testing with better results. Having never tried it myself I cannot comment.

Questions?

Want to review your call script with me?  Don’t understand this process?

Ask below or schedule some startup help time with me.

 

Photo credit:  InfoMofo

 

8 Comments

  1. Janis Petke February 1, 2013 at 2:44 am #

    What do you think of the fact that a reward is given the interview? Would it work if you just trusted the fact that you are proposing a solution to customers burning pain be enough incentive to get responses? Should reward be given or not, what do you think?

    • kevindewalt February 1, 2013 at 6:27 am #

      I don’t think this is an either-or situation. Without a doubt, most reliable feedback is present a burning pain with a solution you can deliver. In this example, though, I was at the very early stages and wanted to see if I even understood the problem. I needed to get to the point of being able to have “burning pain” discussion. It is a judgement call based on what you’re trying to test or learn. If you want to discuss your particular situation just grab a slot on my office hours and we can talk through it: kdewa.lt/startup-help

  2. Clemens Kemper May 13, 2013 at 3:51 am #

    Hi Kevin,
    first off: Great post. I love how you get straight to the point about what worked and what didn’t. I would love to see an actual script of the questions you asked. I find it extremely difficult to ask the right questions.

    On thing for you to try out: Just a few days ago I used Amazon’s Mturk to do customer interviews. It’s an amazingly powerful tool and much cheaper than your approach. This has two benefits: a) you pay less and b) the people who call you only get $1,50 for performing the interview (and I guess I could go even lower), so the incentive to do this for a personal benefit is too small. They call because they’re interested.
    You can choose your customer target group and set up the duration of the tasks. So whenever I know I have an hour to do customer interviews I put in a batch and in less than 5 minutes I get the first call. I’m amazed by the sheer amount of people that call me.

    • kevindewalt May 13, 2013 at 4:50 pm #

      Yep, Justin has a great post on this:

      http://customerdevlabs.com/2012/08/21/using-mturk-to-interview-100-customers-in-4-hours/

      I haven’t tried it but it looks like a much better approach.

      • Salman Merchant September 23, 2013 at 5:50 pm #

        Hi Kevin,

        I’m currently using Amazon’s MTurk for customer discovery interviews and it’s been going relatively well. My product is fairly niche, but even then the response rate has been fantastic. I honed in on my requirements for users, and even with slightly narrow requirements I received roughly 40 calls in one hour. Needless to say I wasn’t able to take every single one, but I’ve finished approximately 30 calls over the course of a few days and some callers are even happy extending their calls to 25/30 minutes depending on how important the problem is to them.

        -Salman

        • kevindewalt September 23, 2013 at 6:07 pm #

          Thanks! I’m sure Justin will be glad to hear this.

  3. Jack Dean November 13, 2014 at 9:11 pm #

    Kevin & Salman,
    Justin’s hack is great. Anytime you can listen to a lot of customers quickly it is a great step. A friend and I actually built a tool based on Justin’s MTurk hack (with a bit of Justin’s help as well), mostly because Mechanical Turk was such a pain to deal with.

    You can check it out here if you want though. It takes care of a lot of the steps like creating MTurk account, GVoice number, recording, notes, etc.
    http://www.customerdiscovery.ninja

  4. biatha June 12, 2016 at 10:35 pm #

    Kevin, thanks for sharing the sample posting. I’m getting started on potential customer interviews now and your post is very helpful.

    Just wondering- wouldn’t you increase your probability of getting false positives by only interviewing people who respond positively to your post? If your post explicitly states that you’re looking for people who have a lot of experience and headaches with medical paperwork, is that not already leading interviewees to respond a certain way to your questions?

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