Ksenia Maiorova, a Lead Product Manager at InDrive, discusses how product development can solve this problem. How can one create a solution that aligns with market demands, meets user needs, contains groundbreaking ideas, and possesses the essential features for proper functionality?

Product discovery – what is it all about?

It is a business process involving research and work with hypotheses in order to develop a new solution or improve an existing one. Marty Cagan, the inventor of this term, defines it as follows: product discovery is a process of eliminating the risks associated with a product’s value, usability, feasibility, and viability. The ultimate goal of discovery is finding a product-market fit.

For example, you decided to develop a new online educational platform. To determine whether this idea is worth putting time and resources into, you should answer some questions that will serve as a filter. Do people want or need this new educational application? Can they effectively use it for their goals? Is it technically possible to implement your idea? Can it exist within various aspects of business like marketing or legal?

This comprehensive process consists of several sub-processes: identifying customer needs, analysing the market and competitive solutions, validating the value proposition, testing the business model, forming a market entry strategy, and validating the proposed solution. Within these sub-processes, there are also numerous stages, which require individual review. However, product discovery is also not a one-time event but an ongoing and nonlinear process aimed at providing continuous value to customers. It is organised in sprints and lined up in a product development cycle.

Discovery is undoubtedly essential for many businesses but there are situations when it may not be worth investing in it. This includes 1) if there are no big risks or the costs of reducing them are too high; 2) if you need well-known features for a new product; 3) If you work in a strictly regulated market like medicine or finance; 4) If you need to create urgent features to resolve crises (speed here is more important than depth). So first, I recommend you to check if it is truly necessary for your business at the moment and only then start a discovery.

Several steps for effective product discovery

This process is useful for both startups and large companies. Regardless of the stage of development and the scale of your enterprise, several crucial steps must be undertaken to ensure successful testing.

Firstly, assemble a “dream team". It should be cross-functional and consist of a product manager, a product designer, a product analyst, and an engineer for discovery tasks, at the very least. They should prioritise objective facts and user data over subjective opinions or assumptions. If your solution exists in an offline environment, also include a team member who works directly with consumers in discovery sprints.

Next, make sure that the entire team understands the main goal – to validate problems and find cost-effective solutions that meet users’ needs. To achieve this, each team member must know the target segment, the specific consumer problem that needs to be solved, and the metrics for success.

Then, equip the team with the necessary tools for working with testing artifacts. Whiteboards and analytical platforms are particularly useful in this regard. For example, Jira’s Discovery projects feature is an excellent choice, while Trello and Airtable are also effective options. Integrate these tools into the routine of meetings and sprints. Without these tools, teams would struggle to effectively document their findings, share ideas, and track progress.

It is essential to conduct discovery on an ongoing basis and maintain a continuous delivery process. If the initial results are not satisfactory, they serve as a guide on what needs improvement, and subsequent iterations of the cycle will progressively refine the product. To do this, continuously gather feedback and seek fresh insights from users. However, interviews are not the only valid method. Depending on the task, surveys, focus groups, or A/B testing may be more suitable.

Before starting the workflow, clearly define the desired outcomes and their format. Throughout each stage of the discovery process, meticulously document the objectives and criteria for advancing to the next phase. Focus on specific increments you wish to achieve, allowing you to either incorporate the acquired information into the delivery phase or put it in the archive for further reference.

Benefits of product discovery

At different stages of the product life cycle, product discovery helps to face various challenges.

Risk mitigation. By conducting thorough testing and validation of ideas, teams identify potential risks early in the development process, thereby avoiding investment in non-viable products. In fact, companies that invest in comprehensive discovery phases can reduce the likelihood of failure by up to 50%.

Product-market fit improvement. By interacting with users as early as possible, developers can gain a deeper understanding of their customers' pain points and preferences. This allows them to create products that are more tailored to the needs of the target market. For example, when Spotify was developing its platform, customer research revealed that users value personalised playlists more than having an extensive music library. As a result, the application now is known for its exceptional playlists and innovative features such as Discover Weekly and Spotify Radio.

Efficient use of resources. Rather than spending 70% of resources (money, time, personnel, equipment, and so on) on ineffective initiatives, you can invest 10-20% in research and experimentation to determine which items are worth creating. Developing a product is expensive, so saving money by preventing costly mistakes is a smart move.

Prioritising essential features. Through product discovery, teams can identify the most crucial features for customers and those that are less important. For instance, when creating a new e-commerce platform, it may become apparent that a streamlined checkout process is more valuable for users than a wide range of payment options. Consequently, a team will prioritise developing this feature.

Enhancing user experience. By actively seeking and incorporating user feedback, companies can significantly improve customer satisfaction and loyalty. According to the digital analytics platform Amplitude report, inventions that undergo structured product discovery demonstrate a 30% increase in user engagement compared to those that do not.

Continuous improvement of the product. Testing allows you to adapt to changing market conditions and user needs. For example, during this process, Ciklum found out that parents of students attending private schools were seeking a more user-friendly Learning Management System (LMS). As a result, they added a calendar to the main page and integrated a chatbot powered by a large language model.

Thus, product research is the foundation for creating a relevant and user-friendly product for any type of business. By understanding the needs and behaviours of customers, you can create a service that will be in demand in the market. Therefore, investing in discovery is a wise investment in the future success of your company.

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