Product Management Basics: Identifying Customer Pain Points and Validating Ideas

Product management

Identifying customer pain points and validating ideas are fundamental to building successful products.

For most first-time entrepreneurs, these components, along with product management in general, are foreign concepts with relatively high learning curves.

Understanding this, Michael Perry — Co-founder of Shopify’s Kit — hosted a Shopify Partner panel discussion on how to effectively take a product from ideation, all the way to launch.

Using anecdotes from the panelists — Holly Cardew, Naruby Schlenker, and Josh Enzer — we’ll walk you through why problem identification, market validation, and feedback are important to the product management lifecycle — and provide some great resources for improving your knowledge of each.

1. Pain point identification

Product management: Pain point identification
Every good product idea starts with identifying a common pain point.

Many aspiring entrepreneurs build their businesses on products that monetize trends, potential market share, and desirability of a proposed solution to an industry problem.

But a product won’t resonate with an audience if there isn’t an emotional attachment, or need for it.

That’s why all good products start with not only identifying an overarching problem, but also identifying a pain point — the emotional, human component of product management that draws in customers and makes them feel something. It’s through pain point identification that Holly Cardew found herself creating her own business, Pixc.

Pixc is an image-editing company that helps edit and optimize product images for ecommerce clients, all within 24 hours of receiving the files.

Back in 2012, Holly was going door-to-door building Shopify stores for Australian retailers who had great brick-and-mortar locations, but no online presence. That’s when she realized that there was a bigger issue at hand than just creating a digital storefront for these businesses — the product content wasn’t properly optimized for online sales.

“[My clients] would give me all these images and product descriptions to upload, and I was like ‘how do you expect to sell these products? That’s terrible content,'” Holly says.

[My clients] would give me all these images and product descriptions to upload, and I was like ‘how do you expect to sell these products? That’s terrible content'.

Holly Cardew, Founder of Pixc

Holly realized that this was a major pain point for traditional retailers looking to enter the ecommerce space, and something that prevented them from being successful doing it.

So Pixc was born.

Holly’s advice for aspiring entrepreneurs and product managers?

“You can’t be passionate about the solution, because the solution is always going to change and pivot. You can be passionate about the problem, which I am, but that problem can come and go depending on the time and ecosystem. But what really keeps me going, and this is what I tell all start-up people, you have to be passionate about the people that you’re solving a problem for.”

Resources for problem identification

Need help identifying new problems and establishing true pain points? These online resources will help get you started:

You might also like: How to Discover & Deliver What Shopify Merchants Need & Want.

2. Market validation

Product management: Market validation
Getting the stamp of approval from your target market will help you validate your proposed idea.

Though you may think your product is solving a common industry pain point, the end result may prove otherwise.

That’s where market research comes in. You want to make sure that the product you’re creating is built for many, and not just one instance of an issue.

Naruby Schlenker, co-founder of Ordoro, confirms the need to validate ideas through market research before starting to start a business plan around your product, application, or service.

“Market validation is so important,” she says.

Market validation is so important.

Naruby Schlenker, Co-Founder of Ordoro

Odoro is an app that helps merchants print shipping labels and keep their inventory in sync.

Before creating Ordoro, Naruby and her co-founders spent a lot of time considering which pain point they’d like their business to tackle. So, when one of their clients, an online retailer specializing in child psychology toys, asked for help identifying major problems affecting his business’s success, they thought they had a winner.

Upon initial consultation, the Ordoro team realized that their client’s problem stemmed from stocking an excessive amount of inventory. This issue spread to other areas of the client’s business, and incurred unnecessary carrying fees, took up too much warehouse space, and made it difficult to track products being shipped to customers.

“What we were originally going to do is an inventory optimization tool that would tell you how much inventory you should carry, based on demand.”

With their pain point solution in hand, they researched similar businesses online and called each one to determine if they experienced the same pain point as the child psychologist, and if they did, would they consider purchasing a product that helped alleviate it.

“They were like ‘what, no. I don’t even know how much inventory I have on hand. What’s really painful is printing shipping labels,’” Naruby explains.

The Ordoro team realized that the pain point they actually needed to address was much earlier in the merchant’s fulfillment process, before inventory optimization could even be considered.

So that’s where they started developing their product — an app that prints shipping labels — eventually building out, and integrating, more advanced features as their product grew.

Resources to help with market validation

Understanding which tools and tactics you should use to validate your idea can be difficult. Use the following resources to make the process a little easier:

You might also like: Principles of Product Design: Learn Fast, Guess Less.

3. Feedback

Product management: Feedback
Solicit feedback wherever you can. The more you can collect, the stronger your end product will be.

Swell is an incentive marketing platform that helps merchants run their own rewards and referral programs. They aim to help merchants reward their customers for whatever it is they’re interested in — but this wasn’t always the case.

Before Swell, Josh Enzer was just a finance guy who knew he wanted to have his own business, but didn’t know where to start. After years in finance, and eventually management consulting, the entrepreneurial opportunity presented itself when he teamed up with his technical cofounder.

The idea for Swell was simple: to incentivise consumers to use Bitcoin. Bitcoin has no chargebacks and no credit card fees, so it’s the perfect payment option for merchants looking to get their businesses up and running fast.

Swell’s app solution would give merchants the ability to reward customers who opted to checkout using Bitcoin.

“It’s really challenging as an entrepreneur because, in most cases, the best feedback speaks against what you’re currently doing,” Josh explains.

It’s really challenging as an entrepreneur because, in most cases, the best feedback speaks against what you’re currently doing.

Josh Enzer, Co-Founder of Swell

Josh quickly found out that both merchants and customers alike weren’t interested in using the digital currency.

But from the fires of their initial concept, the Swell co-founders had numerous conversations with merchants and identified that incentivisation was something they wanted — just not for Bitcoin. The real pain point they were experiencing was creating general incentivization programs around whatever it was their customers were interested in.

“There’s this divergent viewpoint, right? Where you want to be the one where you think you understand what people want, and you have this great solution for it. And you go out into the market and people say, ‘eh, well, maybe. What about this other thing?’”

That’s why it’s so important that, as a product manager or entrepreneur, you actively solicit as much constructive feedback as you can, from a diverse group representative of your target demographic.

This feedback not only helps to iterate on ideas, and pivot when needed, but creates a product that your consumer will actually want to use.

Josh’s advice?

“Have 20 conversations, have 50 conversations — make sure that the conversations that you’re having are reflective of this broader population. And then, try to approach it from an analytical, instead of an emotional, perspective.”

Remember: whatever tool or solution you develop doesn't end with the initial build.

Resources for collecting feedback

The idea of collecting feedback can be scary, especially if you’ve already invested a lot of time and resources into your product idea — but it’s a pillar of effective product management. Use the following resources to know exactly what type of questions you should be asking, and how to go about doing it:

You might also like: How to Give Good Creative Feedback.

Start rockin’ product management 🚀

Armed with a fundamental understanding of pain point identification, market validation, and feedback solicitation, you’re ready to start bringing your product ideas to life.

We look forward to seeing what you come up with. 🙂

How do you know when a product idea is a good one? Let us know using the comments section below.

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