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Research and DiscoveryC

Customer Development

Definition

A methodology pioneered by Steve Blank in which founders and PMs systematically test business hypotheses by getting out of the building and talking to customers. The four steps are Customer Discovery, Customer Validation, Customer Creation, and Company Building. It ensures that products are built on validated market need, not assumption.

Why It Matters for Product Managers

Understanding customer development helps product managers make better decisions about what to build, how to measure success, and where to focus limited resources. Teams that master this concept ship more effectively and maintain stronger alignment between business goals and user needs.

How It Works in Practice

In practice, product teams apply this technique during the discovery phase of product development:

  • Plan — Define the research question and decide on the appropriate method, sample size, and timeline.
  • Recruit — Identify and schedule participants who represent the target user segment.
  • Execute — Conduct the research following the methodology, capturing both qualitative observations and quantitative data.
  • Synthesize — Analyze findings, identify patterns, and translate insights into actionable recommendations for the product team.

    • Effective use of customer development prevents teams from building features based on assumptions and ensures that investment flows toward validated user needs.

    Common Pitfalls

  • Running the technique without a clear hypothesis or research question, which leads to unfocused results.
  • Relying on a single research method instead of triangulating with complementary approaches.
  • Letting stakeholder opinions override what the data and user feedback actually reveal.

    • Related Concepts

    To build a more complete picture, explore these related concepts: Lean Startup, Problem Statement, and Persona. Each connects to this term and together they form a toolkit that product managers draw on daily.

    Related Terms

    Lean StartupProblem StatementPersona

    Frequently Asked Questions

    What is customer development in product management?+
    A methodology pioneered by Steve Blank in which founders and PMs systematically test business hypotheses by getting out of the building and talking to customers. Product managers use this concept to make more informed decisions and deliver better outcomes for users and the business.
    When should a product team use customer development?+
    Product teams should use customer development during the discovery phase when they need to validate assumptions, understand user behavior, or test demand for a new feature. It is most effective when combined with complementary research methods to triangulate findings.
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