The Underrated Research: Engaging with Customers Before Starting a Business

Starting your own business is a significant journey, and the path to success often begins with a deep dive into the world of research. However, many budding entrepreneurs rely too heavily on market reports and articles, neglecting a critical component: engaging directly with your potential customers. This article explores the importance of customer feedback in shaping your business strategy and the firsthand experiences of founding a successful company.

Common Missteps in Early-Stage Research

Here’s how many individuals approach the initial stages of research:

Reading McKinsey/BCG Reports: While these reports provide valuable insights, they are designed to inform broader strategic decisions rather than specific implementations. Supplemental Reading on Quora/Medium: These platforms can be beneficial but are often meant for general consumption, not direct application in a business context. Direct Product Development: Some entrepreneurs jump straight into building a product without sufficient customer engagement. This can lead to misalignment with market needs.

As these methods collectively show, reports and articles are meant to be read, not necessarily implemented. The most critical but often underrated form of research is talking to your customers and gathering their feedback.

Customer Feedback as the Backbone

When Cogno AI was founded in 2017, the team faced a significant challenge: determining the specific needs of the Financial Services industry. Rather than relying solely on reports, the founders took a different approach—speaking to potential customers. This method proved invaluable.

Engaging with Industry Leaders:

AVP at YES Bank: Feedback indicated a need for AI and voice solutions, particularly for customer authentication using voice biometrics. DGM at SBI: They expressed a desire for AI chatbot solutions to automate common customer inquiries. SVP at HDFC Bank: The feedback suggested that they were heavily invested in AI and bots, and were exploring the possibility of integrating human and artificial intelligence. President at Axis Bank: They highlighted the implementation of a chat-based solution with another service provider.

The realization that each company was looking for chat-based solutions, not IVR-based voice assistants, led to a pivot in the business model. This crucial feedback was a turning point for Cogno AI, which ultimately led to the development of a robust product. Today, Cogno AI boasts 60 large enterprise clients in the Financial Services Space, a testament to the effectiveness of engaging directly with customers.

Customer Feedback: A Key for Entrepreneurs at All Stages

Customer feedback is not just for early-stage founders. Late-stage founders can also derive immense benefit from staying in constant touch with their customers. Here’s how:

DoorDash’s Success Story: When Harshita and I were building our first office, we began by collecting extensive customer feedback. Harshita and I had up to 12 back-to-back zoom meetings each day, detailing their needs and preferences. Focus and Specialization: We chose to focus on doing a few things exceptionally well rather than trying to do everything. This approach has been a cornerstone of our success and has been detailed in a dedicated blog post.

Conclusion: The Power of Listening

As an entrepreneur, your most critical role is to listen to your customers. This is a process that spans all stages of your business, from the very beginning to the late stages. Engaging with your customers, understanding their needs, and making iterative improvements based on their feedback can set you apart from your competition. Just as Cogno AI and DoorDash did, you can leverage customer feedback to build a successful and sustainable business.

Further Reading and Resources

To learn more about the role of customer feedback in entrepreneurship, you can read a detailed Quora answer by the author on their entrepreneurship journey.