A Gread Idea Validation Method Used By Stripe

80% of products and features are rarely or never used. Why? Because they're solutions for problems customers don't care enough about.

I spent over a year doing 100+ customer discovery interviews only to follow the wrong problem. I've also spent 5+ years as a Techstars Community Leader and Global Facilitator helping hundreds of early stage entrepreneurs from around the world to validate their ideas and build first-concept products. If there is one thing I've learned, it's that validation is hard.

At the end of March 2021 I came across this thread by Twitter-wizard and product management genuis Shreyas Doshi describing an idea validation method called Customer Problem Stack Ranking that they use at Stripe.

So I tried Customer Problem Stack Ranking out on my own startup and the value proposition that we spent 7 months of discovery reseach crafting came dead last with our target customer segment.

Dead. Fucking. Last.

We learned more in 2 hours using this stack ranking approach than we did in 100+ customer discovery interviews.

To explain how Customer Problem Stack Ranking works, I'm going to take a startup idea that I've heard at countless hackathons; an app that makes it easier for a group booking their holiday to split the cost of accommodation and activities. We can call this hypothetical app Splitzies.

What is Customer Problem Stack Ranking?

Customer Problem Stack Ranking (CPSR) tells you how important your idea is compared to the other problems your target customers experience. It's a simple data-driven approach to understanding whether your idea solves a burning pain point 🔥 or just a mild inconvenience 🙄

Step 1: Write Your Question

Customer Problem Stack Ranking is a type of survey so it needs a question, which usually goes along the lines of "What is the most frustrating aspect about ____ ?". Your CPSR question should be broad enough that it allows your participants to explore all the problems associated with an activity rather than just the specific problem that you're trying to solve.

For our imaginary app Splitzies, our 'activity of focus' is booking a group holiday so our question is: What is the most frustrating part of booking a group holiday?

Step 2: Turn Your Idea Into A Problem Statement

Asking target customers to rate your idea is a bad idea. As Rob Fitzpatrick's book The Mom Test explains, if you ask people about your idea they'll just tell you it's great so that they don't hurt your feelings. Instead, we need to turn our idea statement into a problem statement so that we can compare it to the other problems that customers face in our 'activity of focus'.

For Splitzies, our problem statement could be: "Dividing the cost of a hotel booking is frustrating and complicated when planning a group holiday." You can create multiple problem statements to explore the different pain points your idea might solve and the different words your target customers might use to talk about the 'activity of focus'.

If you're not convinced about the need to use problem statements, here's a short video from a serial entrepreneur. If you're struggling to write your own, here's a quick how-to video on problem statements.

Step 3: Create Peripheral Problem Statements

Brainstorm problem statements that fall under the same 'activity of focus' but aren't related to your idea. These can be informed by a handful of interviews using open-ended questions or by reading some "pain points" related blog posts/forums. Don't worry if you feel like you've missed some peripheral problems. Stack Ranking tools like OpinionX let participants add new problem statements to cover areas you miss.

Lets have a go at writing some peripheral problem statements for Splitzies:

- Keeping a list of potential Airbnbs and hotels turns into a giant messy spreadsheet.

- Agreeing on dates that suit everyone is a pain!

- It's difficult to plan activities when I haven't organised a transport method like car rental or public transport.

- It's hard to find out how expensive a destination is for general things like food and transport.

- Some destinations are very different depending on time of year but good information on seasonality is hard to come across.

Step 4: Send Your Stack Rank To Target Customers

Send your stack rank survey link to target customers. Pick one specific segment rather than a generic demographic to avoid noisy data. For example, if I send my Splitzies stack rank to both young parents planning a family holiday and student backpackers, they're going to have very different priority problems and our data will get all messed up.

If you haven't got a pre-release waitlist, hit people's DMs on online communities, forums and social media. We joined a few Slack communities for Product Managers and got +25% response rate on a couple hundred messages for a Customer Problem Stack Rank we did on our own startup (this outreach only took a couple of hours one evening).

Step 5: Iterate!

You start to see priorities emerge very quickly once votes start rolling in. As participants add their own problem statements, you'll also learn about new pain points you hadn't known about. Use these learnings to inform new sample problems and continue pushing your link out to participants.

Step 6: Results

Sort all the problems by highest or lowest importance to stack rank your statements. In one click, you'll know how important your value proposition is compared to the other problems your target customers face.

Like I said earlier, the results of the stack ranking experiement we did on our own startup showed us that the value proposition we had spent 7 months building through customer discovery research came dead last for our target users. What was surprising though, was that our stack ranking helped us realised the big picture problem we were interested in was actually really important to our target customers, but they were using a completely different vocabularly to us. The words we were using couldn't have been resonating less.

So, we took the top 6 most important problems from our stack rank results and rewrote our entire landing page and onboarding experience.

Step 7: Go.

The best time to do Customer Problem Stack Ranking was yesterday. Whether you've got a killer idea for a startup or you're trying to align your existing product with problems that your customers actually care about, Customer Problem Stack Ranking is a versatile and flexible solution that's ready to help.

I don't personally view Customer Problem Stack Ranking as a direct replacement to interviews. Instead, conducting a stack ranking can help you to identify validated priority pain points that you can dig deeper into with a smaller set of more focused interviews.

Create your own Customer Problem Stack Rank for free on OpinionX today and get closer to finding that all important product-market fit.

Previously published at https://www.opinionx.co/blog/customer-problem-stack-ranking