February 15, 2016
Testing and shaping your offering for success
Testing and shaping is the principle you need to reduce the risks of doing something new. You and your team needs to learn to experiment early, often and throughout the development process. You’ll learn to use what you learn to work through problems, improve your idea and strengthen its execution.
Just like you do in real life.
Here are a couple of examples of companies running low-cost experiments to learn. Use them to inspire your own experiments.
Dropbox, created by Drew Houston, was one the first easy to use cloud-based file storage solutions. Do you remember what people initially thought of cloud storage? Why would you need that? Isn’t it slow? I would never let someone else store my files. It’s too complicated.
There was a lot of uncertainty as they pursued their new solution. In fact, Drew was having a hard time raising venture capital because he couldn’t demo the product until it was built. They needed financing to overcome the technical challenges in what he envisioned.
Frustrated, he created a 3-minute video to show what the experience would be like. He put the video on a web page and asked the technical community to go check it out. Within a day, their beta sign up list went from 5000 people to 75,000.
He learned quickly that if they could develop the product as it worked in his video, it would have very high trial rates. He secured his venture capital.
Rent-the-Runway is an online dress rental service. They did not want to invest a lot of time and resources in their idea if women would never rent a dress online. And since it was a new service, they didn’t even know what questions women would have or what challenges they would encounter delivering the service.
Their first experiment was to recruit women to a location where they could look at the dresses but not try them on before renting. This experiment taught them so much about selection, sizing, and the initial experience women have in renting a dress!
Next, they did away with the actual dresses and had women select dresses from pages printed on an inkjet to mimic how they would appear on a web page. With this simple iteration, they learned the new questions women would have when selecting a dress online through pictures and descriptions only.
In both these examples, the tests provided information critical to the understanding and belief in the innovative new ideas.