Your early target customers will reveal a lot about your sales process. Here’s what you can learn from them - whether they buy in or not.

I was speaking with a few entrepreneurs this past week and the topic of getting your first paying customers came up. Some example questions include: When is the product “good-enough?” When do you ask for the sale? How much should you charge? Remember, at this early stage you are still in learning mode. What better way to learn then to ask a potential customer to pay for the product? If they easily buy, you know you likely left value on the table. If they have lots of debate, you learn more about their buying process. If they say not yet, you can determine what is good enough. If they say no, you can tease out why. Here are three things to try and understand when targeting your first customers.

Understanding value

Customers buy a solution because you are helping them solve a problem. Solving that problem delivers value to them in terms of increased revenue, lower costs, improved efficiency, etc. When trying to get customers to pay, they buy because they believe in the value you could provide. Even if the product is not perfect, you can learn where they see value and which part of your solution is good enough to deliver value. You also can explore different pricing models that make value easier to understand. I have seen scenarios where customers will turn down a lower cost way of pricing because the model doesn’t fit their needs (i.e. they would rather pay $500/year for ongoing support than a one-time $1,000 implementation fee up front).

Understanding buying process

Another key area for learning is their buying process. From the people side you can see how decisions are made, who recommends, who champions, and who ultimately makes the decision. You also can learn a lot about what type of messaging and process moves the deal forward. What part of the value is pitched, what proof is needed, what key words/phrases ring true, etc. You can also refine your process of how to target the buyers and tools/scripts to best understand their problem and communicate your value.

Understanding focus

After you close several of your first sales, it is really interesting and powerful to compare across your customers for commonalities and differences. Where is their consistency in problem identification, successful messaging, ideal customer profile, value provided, etc. Honing this focus allows you to better prepare to scaling up a go-to-market strategy and putting the right process in place to go from 10 to 100 customers; from 100 to 1,000 customers. If you find there are lots of differences in buyers, problems, messaging, etc. it is likely you are still searching for product-market fit and may need to keep testing different approaches until one of those segments and approaches stands out.

When you are first starting a company, learning and adapting is most critical (and the one superpower startups have over established competitors). Use trying to sell to your early customers as a way to test your hypotheses to learn and iterate.

‍