Revolutionizing Entrepreneurship: The AI-Driven Path to Success
Revolutionizing Entrepreneurship: The AI-Driven Path to Success
Unveiling the Power of AI in Crafting Winning Value Propositions and Discovering Customer Archetypes
Unlocking Entrepreneurial Success with Generative AI: Enhancing the Business Model Canvas for the Digital Age
When I first started teaching entrepreneurship to high school students in 2014, the Lean Startup approach, along with the Business Model Canvas, were foundational elements of the curriculum. Starting in 2018, I used the same tools to help my clients develop writing and publishing businesses.
Now, artificial intelligence enhances and improves those foundational elements in a way that will radically change how we approach entrepreneurship. Generative AI, including advanced tools like ChatGPT, has emerged as an indispensable asset for idea generation and new ventures.
Its significance stems from two pivotal capabilities:
1. the ability to process and analyze massive datasets
2. a proficiency in recognizing complex patterns
These attributes make generative AI not just a tool for automation or efficiency, but a partner in the creative and strategic processes of building a business or developing an idea. It can uncover insights hidden in vast amounts of data, and its pattern recognition can guide you in making informed decisions, identifying unique opportunities, and navigating the intricate landscape of customer needs and market dynamics. What used to take dozens or hundreds of customer interviews can now be simulated—with relative accuracy—with a chatbot such as ChatGPT.
However, it’s crucial to understand that the adoption of generative AI techniques assists with the customer discovery process. Human intuition, empathy, and the nuanced understanding of customer behaviors remain at the heart of successful entrepreneurial ventures. In other words, ChatGPT should enhance your customer discovery process, not replace it.
Generative AI should be seen as a powerful amplifier of these human capabilities, providing data-driven insights that can refine and enhance the intuition and hypotheses that you bring to the table.
The introduction of generative AI also invites a reevaluation of established entrepreneurial frameworks, notably Alex Osterwalder’s Business Model Canvas (BMC).
While the BMC remains an invaluable tool for mapping out business models, the rise of AI and the increasing importance of understanding customer behaviors suggest it may be time for an update.
The “right side” of the BMC, which focuses on customers and their behaviors, is becoming increasingly critical. This shift reflects a broader understanding that solutions (traditionally mapped on the “left side” of the BMC) often come prematurely, without a deep understanding of the customer problems they aim to solve.
Whether it was the students in my classroom or the clients on my Zoom calls, the most common problem I observed was entrepreneurs jumping straight to a solution before defining and validating the problem.
Below, I present a reimagined Business Model Canvas for the Age of AI. This updated framework places greater emphasis on the customer-focused elements of entrepreneurship (problem first, then solution), integrating generative AI as a central tool for enhancing understanding and engagement with customer archetypes, empathy mapping, and ultimately, the validation of value propositions.
This new canvas aims to guide you through the nuanced landscape of modern business, where technology and human insight must intertwine seamlessly to create successful, customer-centric ventures. It emphasizes the importance of focusing on the problem through customer discovery rather than building a solution prematurely.
Crafting Your Value Proposition: A Guide for Entrepreneurs to Stand Out in the Market
Discovering a Value Proposition, as framed within Alex Osterwalder’s Business Model Canvas (BMC), is a crucial step in distinguishing your offerings in the marketplace.
The Value Proposition is the cornerstone of the BMC, highlighting how a company’s products or services solve specific customer problems or meet distinct customer needs in ways that competitors do not. Crafting a compelling Value Proposition requires a deep understanding of customers, a clear insight into the competitive landscape, and an innovative approach to solving market needs.
The process of discovering a Value Proposition starts with customer discovery and market research. You must immerse yourself in the lives of your potential customers to gain a genuine understanding of their pain points, preferences, and behaviors. This can involve conducting surveys, interviews, and focus groups, as well as analyzing customer feedback on existing products or services. The goal is to uncover unmet needs or areas of frustration that represent opportunities for differentiation.
Once a thorough understanding of customer needs is established, the next step is to analyze the competitive landscape. This involves identifying direct and indirect competitors, assessing your offerings, and pinpointing your strengths and weaknesses.
By understanding the competitive context, you can identify gaps in the market or aspects of customer needs that are not adequately addressed. This competitive analysis helps in shaping a Value Proposition that not only meets customer needs but also offers something unique that competitors lack.
Once you move beyond the ideation phase, customer validation is critical before you can build a solution.
In my experience of working with entrepreneurs, start-ups, and students in entrepreneurship programs, “falling in love with the solution” is the single-most common mistake. Entrepreneurs often start building things that nobody wants, or nobody asked for. They become so entranced by the idea that they skip the validation phase, which often results in failure because they must generate demand in the market rather than serving it.
Therefore, a highly specific and thoughtful Value Proposition is necessary because it helps you to aim in the right direction.
Let’s look at a few Value Propositions I’ve reverse engineered based on the products or services they’ve built:
Airbnb: “Transforming the way people travel by offering unique and affordable lodging options around the world, allowing guests to experience destinations as locals do.”
Tesla: “Accelerating the world’s transition to sustainable energy with cutting-edge electric vehicles that blend performance, safety, and environmental responsibility.”
Netflix: “Providing endless entertainment through a vast library of movies and TV shows, accessible anytime and anywhere, personalized to each user’s preferences.”
Uber: “Revolutionizing urban mobility by offering a reliable, efficient, and convenient ride-hailing service that connects riders with drivers at the touch of a button.”
Amazon: “Delivering an unparalleled shopping experience by offering a vast selection, competitive prices, and fast delivery, making everything you need accessible from the comfort of your home.”
Creating a compelling Value Proposition involves deeply understanding the core benefit your offering provides, knowing who your target audience is, and clearly articulating how your solution differs from and is better than what’s already available.
Here are several questions for each of the three elements to help you in this process:
Core Benefit
What specific problem does your product or service solve for your customers?
How does your offering improve the customer’s life, work, or play?
What emotional or practical needs are you fulfilling with your offering?
Can customers achieve the same outcome without your product or service? If so, how does your offering make it easier, faster, or more enjoyable?
What is the primary reason a customer would choose your offering over doing nothing at all?
Audience
Who are the specific individuals or businesses that will benefit most from your offering?
What are the demographic and psychographic characteristics of your target market?
What are the common behaviors, motivations, and pain points of your ideal customers?
How do your customers prefer to discover, purchase, and interact with products or services like yours?
In what ways do your ideal customers define success, and how does your offering contribute to that success?
Differentiation
What features or aspects of your offering are unique compared to your competitors?
How does your solution provide better value for money, superior quality, or a more desirable experience?
What do you do differently in terms of process, technology, or customer service that sets you apart?
How do you communicate your unique selling points to your target audience effectively?
In what ways are you innovating in your industry or market to stay ahead of competitors?
By thoroughly answering these questions, you can gain a deeper understanding of the value you’re offering, to whom you’re offering it, and what makes your solution stand out. This clarity is crucial in crafting a Value Proposition that resonates with the target audience and effectively communicates why your offering is the best choice.
Although my students did not answer all the questions above, thinking about the potential answers helped to keep them focused on the problem instead of the solution. It’s impossible not to leap ahead to solutions, and it’s normal to be thinking about those solutions. However, building or implementing those solutions before defining a Vale Proposition has resulted in countless businesses failures.
Let’s apply the questions to Airbnb to illustrate how answering them can help in understanding its Value Proposition:
Core Benefit
What specific problem does your product or service solve for your customers? Airbnb offers travelers a more personalized and unique lodging experience compared to traditional hotels, allowing them to stay in local homes and experience destinations, as locals do.
How does your offering improve the customer’s life, work, or play? Airbnb enhances travel experiences by providing diverse accommodation options, from apartments to castles, fitting various budgets and preferences, enabling travelers to tailor their stays to their unique needs and desires.
What emotional or practical needs are you fulfilling with your offering? It fulfills the desire for authentic travel experiences, connection with local cultures, and the comfort of home-like amenities, meeting both emotional needs for belonging and practical needs for space and facilities.
Can customers achieve the same outcome without your product or service? If so, how does your offering make it easier, faster, or more enjoyable? While traditional lodging options offer accommodation, Airbnb makes discovering and booking unique stays easier, offers a wider range of prices and styles, and provides a platform for direct communication between hosts and guests to enhance the travel experience.
What is the primary reason a customer would choose your offering over doing nothing at all? The primary reason is the opportunity Airbnb provides to immerse in the local community, live like a local, and have a more enriching, personalized travel experience compared to standard hotel stays.
Audience
Who are the specific individuals or businesses that will benefit most from your offering? Airbnb targets adventurous travelers, families, business travelers seeking a home-like environment, and anyone looking for unique, affordable, or locally immersive lodging options.
What are the demographic and psychographic characteristics of your target market? The target market includes a wide demographic range, from millennials to older travelers, who value experiences over material goods, seek authenticity in their travels, and prefer personalized options to standard ones.
What are the common behaviors, motivations, and pain points of your ideal customers? Ideal customers are motivated by the desire for new experiences, cultural immersion, and affordable travel. Their pain points include the impersonal nature of hotels, high costs of traditional accommodations, and a desire for more space and amenities.
How do your customers prefer to discover, purchase, and interact with products or services like yours? Customers prefer easy online and mobile platforms for discovering, booking, and interacting with hosts. They value user reviews, photos, and clear descriptions to make informed decisions.
In what ways do your ideal customers define success, and how does your offering contribute to that success? Success for Airbnb’s customers is defined by memorable and authentic travel experiences, comfort, convenience, and value for money. Airbnb contributes to this by offering a platform that facilitates these experiences through diverse listings, easy booking processes, and community reviews.
Differentiation
What features or aspects of your offering are unique compared to your competitors? Airbnb’s unique offering includes the breadth of unique accommodations worldwide, the ability to live like a local, and features like Experiences that allow travelers to engage in local activities.
How does your solution provide better value for money, superior quality, or a more desirable experience? Airbnb provides better value for money by offering a range of price points and types of accommodations. The platform ensures quality through a review system and offers a more desirable, personalized travel experience through its unique listings and local experiences.
What do you do differently in terms of process, technology, or customer service that sets you apart? Airbnb uses technology to streamline the booking process, offers a robust review system for transparency, and provides a platform for hosts and guests to communicate directly, enhancing the travel experience and customer service.
How do you communicate your unique selling points to your target audience effectively? Airbnb communicates its unique selling points through storytelling in its marketing, highlighting real guest and host stories, leveraging social media, and emphasizing the unique experiences and accommodations available on its platform.
In what ways are you innovating in your industry or market to stay ahead of competitors? Airbnb continuously innovates by expanding its listings to include unique accommodations like treehouses and castles, launching new services like Airbnb Experiences for local activities, and improving platform features to enhance user experience and safety.
By answering these questions, Airbnb can clearly articulate its Value Proposition: offering unique, affordable, and local travel experiences through a wide range of accommodations worldwide, allowing travelers to feel at home anywhere.
The most important takeaway for developing a Value Proposition is that the value is in the process of creating one, not in the actual statement. Value Propositions can be similar to “mission statements” in that they can change, grow, and evolve over time. Just the process of creating a Value Proposition will help you and your team decide who you are going to serve and how you plan to do it differently.
Continuing with the Airbnb example, let’s refine the answer to the previous questions into the three general areas:
Core Benefit: Airbnb solves the problem of impersonal travel accommodations by providing a diverse array of unique and affordable lodging options that enhance the travel experience with home-like comforts and local immersion.
Audience: Airbnb targets adventurous individuals, families, and business travelers seeking personalized, culturally rich, and cost-effective lodging alternatives to traditional hotels.
Differentiation: Airbnb sets itself apart by offering an unparalleled selection of unique stays, a community-driven platform that facilitates authentic local experiences, and a user-friendly interface that connects hosts and guests worldwide.
Which then can be further refined into a single-sentence Value Proposition:
“Transforming the way people travel by offering unique and affordable lodging options around the world, allowing guests to experience destinations as locals do.”
You can leverage the power of generative AI by providing a chatbot like ChatGPT with data, and asking it to analyze and synthesize it into a Value Proposition.
Here is a prompt you can use:
// Beginning of Prompt //
Based on the following information, synthesize a single-sentence Value Proposition that encapsulates the essence of my business, targeting my specified audience, and highlighting my unique differentiation.
Core Benefit: What is the primary problem your product or service solves, and how does it improve your customers’ lives or work? [your Core Benefit goes here]
Audience: Who is your target customer? Please specify their needs, preferences, and the challenges they face that your business addresses. [your Audience goes here]
Differentiation: What makes your offering unique and better than existing alternatives in the market? Focus on your unique selling points and how they benefit your target audience. [your differentiation goes here]
// End of Prompt //
This process enables you to develop a Value Proposition that not only addresses a genuine need in the market but also distinguishes your offerings from those of your competitors, laying a solid foundation for your business model within the BMC framework.
Steel Manning Your Value Proposition: A Strategic Approach to Outshine Competitors
Steel manning a Value Proposition by using the most popular competitor’s stance involves a strategic approach, where you take the strongest aspects of your competitor’s Value Proposition and use them as a benchmark to refine and enhance your own.
This method not only ensures that your Value Proposition is competitive but also that it addresses the market needs and preferences highlighted by your competitor’s success.
Here’s how to do this, using Starbucks vs. Dunkin’ as an example:
Analyze the Competitor’s Value Proposition: Start by deeply understanding the Value Proposition of your most popular competitor. For Starbucks, it might be offering a premium coffee experience with a focus on high-quality products, a comfortable atmosphere, and a wide variety of customizable options. For Dunkin’, it’s about providing good coffee fast, conveniently, and at a great value.
Identify Strengths and Appeal: Identify what makes the competitor’s Value Proposition appealing to their customers. Is it the product quality, the brand experience, the price point, or the convenience? For Starbucks, the appeal may be the premium experience and customization, while for Dunkin’, it could be the speed, convenience, and value for money.
Contrast with Your Offering: Look at your own Value Proposition in light of the competitor’s strengths. What unique benefits or features does your offering have that can stand up against or exceed those of the competitor? This requires an honest assessment of where your product or service stands in comparison.
Refine Your Value Proposition: Use this insight to refine your Value Proposition. If your competitor excels at product quality and experience (like Starbucks), but your strength lies in convenience and value (similar to Dunkin’), highlight these aspects. Make sure to articulate why these benefits matter to your target audience and how they address the customer’s needs or desires in ways that the competitor’s offering does not.
Incorporate Feedback and Iterate: Present this refined Value Proposition to potential customers, ideally those who are current users of the competitor’s product. Use their feedback to further refine your proposition. This feedback loop can help you uncover nuances about customer preferences and how your offering can better meet them.
Finalize the Enhanced Proposition: After iterating based on feedback, finalize a Value Proposition that not only addresses the strengths found in your competitor’s offering but also highlights your unique advantages. This should result in a compelling statement that confidently positions your offering in the market.
By steel manning your Value Proposition against a popular competitor’s, you’re essentially ensuring your offering is not only competitive but also uniquely appealing to your target market. This process forces you to elevate your Value Proposition by directly addressing what makes your competitor successful and finding ways to convincingly argue that your product or service is the better choice for your target customers.
Now, let’s examine how you can steel man your Value Proposition.
To steel man a defined Value Proposition and gain clarity, you can follow a structured approach that focuses on rigorously challenging and subsequently strengthening your proposition.
This involves critically examining the Value Proposition from various perspectives, identifying potential weaknesses, and enhancing its appeal to ensure it robustly meets customer needs and stands out in the competitive landscape.
Here’s a step-by-step guide:
Articulate Your Current Value Proposition: Clearly state your current Value Proposition. This should succinctly summarize the unique value your product or service offers to your target customers.
Identify Your Strongest Competitor’s Value Proposition: Select the Value Proposition of your strongest competitor. Understand the key elements that make it compelling to customers in your target market.
Compare and Contrast: Systematically compare your Value Proposition against your competitor’s. Look for areas where your competitor’s Value Proposition might be perceived as stronger, more compelling, or more appealing to your target audience.
Identify Gaps and Opportunities: Identify any gaps in your Value Proposition where you could provide additional value or differentiate more clearly. Consider opportunities to enhance aspects such as quality, convenience, price, or customer experience.
Gather Feedback: Seek feedback from potential customers, industry experts, or mentors on both your and your competitor’s Value Propositions. Specifically, ask them to identify strengths and weaknesses in both. Use this feedback to uncover insights you might have overlooked.
Refine and Strengthen: Based on your analysis and the feedback received, refine your Value Proposition. This might involve emphasizing different aspects of your product or service, addressing identified weaknesses, or incorporating new elements that better meet customer needs or differentiate you from competitors.
Test and Validate: Test the revised Value Proposition with potential customers to see if it resonates more strongly than before. This could be done through customer interviews, surveys, or A/B testing in marketing materials.
Iterate as Needed: Use the insights gained from testing to make further adjustments. It’s likely that you’ll need to iterate several times to fine-tune the message and ensure it strongly communicates the unique value you offer.
By thoroughly steel manning your Value Proposition in this way, you not only gain clarity about what makes your offering valuable but also strengthen your position in the market. This process forces you to deeply understand your customers’ needs and preferences, how you meet those needs uniquely, and how to communicate that effectively. It’s a proactive approach to ensuring your Value Proposition robustly stands up to scrutiny and appeals compellingly to your target audience.
You can leverage the power of generative AI by providing a chatbot like ChatGPT with data, and asking it to steel man your Value Proposition.
Here is a two-part prompt:
// Beginning of Prompt //
Part One
Help me identify a strong competitor in my industry [mention your industry or niche] and summarize their Value Proposition. I’m looking for insights into what makes their offering appealing to our shared target market.
Include key aspects, such as the core benefit they provide, their target audience, and what differentiates them from other players in the market. Here is my Value Proposition:
[your Value Proposition here]
Part Two
Now that we have identified my competitor’s Value Proposition, I’d like to compare and contrast it with my own (provide your current Value Proposition). Specifically, I’m interested in understanding:
How does my Value Proposition stand up against my competitor’s in terms of clarity, appeal, and differentiation?
What are the strengths and weaknesses of my Value Proposition compared to my competitor’s?
Are there any gaps or opportunities in my Value Proposition that I can exploit to better meet the needs of our shared target market or to differentiate myself more effectively?
// End of Prompt //
These prompts are designed to guide you through a strategic analysis of your Value Proposition in relation to a key competitor, leveraging ChatGPT’s capabilities to gain insights, identify gaps, and ultimately strengthen your market positioning.
Empathy Mapping: Unlocking Deep Customer Insights for Product Innovation
An empathy map is a powerful tool used in customer discovery to help you deeply understand your customers’ experiences. It’s a visual representation that captures what a specific customer segment sees, hears, thinks, feels, says, and does.
The goal of an empathy map is to go beyond surface-level customer demographics and into the psychological and emotional drivers of customer behavior. By doing so, you can develop a more nuanced understanding of your customers, leading to better product design, marketing strategies, and customer experiences.
An empathy map is typically divided into several sections, each corresponding to a different aspect of the customer’s interaction with the world and your product:
Says: Quotations and phrases your customers use.
Thinks: What your customers are thinking about but might not be saying out loud.
Does: The actions your customers take.
Feels: The emotions your customers experience.
Sees: What your customers see in their environment.
Hears: What your customers hear from friends, social media, etc.
You can use empathy maps in customer discovery by following these steps:
Gather Data: Start with qualitative research, such as customer interviews, observations, and secondary research, to gather insights about your customer segment.
Create the Empathy Map: Use a large poster or digital tool and divide it into the sections mentioned above. Populate each section with insights gathered during your research. It’s helpful to focus on one customer segment at a time to ensure the map is specific and actionable.
Analyze the Map: Look for patterns or insights that emerge. Pay special attention to contradictions between what customers say and what they do, or between what they think and how they feel. These discrepancies can uncover unmet needs or pain points.
Identify Opportunities: Use the insights from the empathy map to identify opportunities for innovation or improvement in your product or service. This could involve addressing unmet needs, alleviating pain points, or enhancing aspects of the customer experience that are particularly important to your target segment.
Iterate on Your Product/Service: Apply the insights from your empathy map to iterate on your product or service design. This iterative process should be ongoing, as understanding your customers more deeply may lead to further refinements.
Empathy maps are particularly useful in the early stages of product development but can be revisited at any point to refine customer understanding. They encourage a customer-centric approach, reminding you to keep the customer’s perspective at the forefront of all decision-making processes.
Let’s return to our Airbnb example and see their empathy map.
Creating an empathy map for Airbnb customers involves understanding the diverse experiences and interactions guests have with the platform, from browsing listings to staying at an Airbnb.
Here’s an example based on common customer experiences:
Says
“I love finding unique places to stay that aren’t just generic hotel rooms.”
“Staying at an Airbnb helps me feel more connected to the local culture.”
“It’s great to have a kitchen and living space, especially for longer trips.”
Thinks
“I hope the place looks as good in person as it does in the pictures.”
“Is this neighborhood safe and conveniently located near the attractions I want to visit?”
“How do I make sure my host is reliable and the property is clean?”
Does
Browses through listings, reading descriptions, and reviews carefully.
Communicates with hosts to ask questions about the listing or to get local tips.
Shares experiences and photos from their stay on social media.
Feels
Excited about the prospect of staying in a unique place.
Anxious about the accuracy of listings and the safety of the neighborhood.
Satisfied when the stay meets or exceeds expectations, feeling a sense of belonging and connection to the local area.
Sees
Photos and descriptions of diverse listings, from cozy apartments to treehouses.
Maps and location information that help gauge proximity to tourist attractions or amenities.
Reviews and ratings from previous guests, providing insight into their experiences.
Hears
Recommendations from friends or family about staying at an Airbnb for a more authentic travel experience.
Stories about great or sometimes poor experiences with Airbnb stays, influencing expectations.
Tips and advice from social media influencers or travel bloggers about how to choose the best Airbnb listings.
This empathy map example for Airbnb customers highlights the multifaceted nature of the customer experience, from the anticipation and decision-making process to the actual stay and post-visit reflection. Understanding these perspectives helps Airbnb and hosts alike to enhance their offerings, address concerns, and ultimately provide a more enjoyable and authentic travel experience.
Again, you can use generative AI for customer discovery. However, it’s important to reiterate that customer discover using ChatGPT is not enough. The process should always be improved or enhanced by real conversations, with real humans (through customer discovery interviews).
Let’s start by using ChatGPT to create a “rough draft” of a customer archetype.
Here is a prompt:
// Beginning of Prompt //
Based on my Value Proposition [your Value Proposition here], I’d like to generate a detailed customer archetype that aligns with this proposition. My Value Proposition is focused on [briefly describe the core benefits, target audience, and unique differentiators of your product/service]. Considering this, please help me outline a customer archetype by answering the following questions:
Demographics: What are the age, gender, income level, education, and occupation of my ideal customer?
Psychographics: What are the interests, hobbies, values, and lifestyle preferences of this customer?
Needs and Pain Points: Based on my Value Proposition, what specific needs or problems does my customer have that my product/service addresses?
Behavioral Traits: How does this customer typically make purchasing decisions? What are their shopping habits, and how do they prefer to interact with brands or services?
Influences: Who or what influences my customer’s buying decisions? This can include people, media, trends, or other factors.
Goals and Aspirations: What are the short-term and long-term goals of my customer in the context of my Value Proposition? What are they hoping to achieve or improve in their lives or work?
Using the details of my Value Proposition as a guide, please create a comprehensive customer archetype that embodies the ideal target for my product/service. This archetype will help me better understand my audience and guide the development of an empathy map tailored to their experiences and needs.
// End of Prompt //
Once we have a customer archetype, we can feed it to ChatGPT to generate an empathy map.
Here is a prompt:
// Beginning of Prompt //
Help me create an empathy map for my customer archetype based on the following details about my business and target customers. My business is [name of business, industry or niche, Value Proposition]. My target customer archetype is [your customer archetype description].
Says: What are some quotations and phrases that my target customers might use when describing their needs, frustrations, or experiences related to my industry or offering?
Thinks: What might my target customers be thinking about but not openly expressing? Consider their internal dialogues, concerns, and desires related to my product/service.
Does: Describe the actions my target customers take when they interact with products/services in my category. Include both the steps they take and behaviors they exhibit during their decision-making process.
Feels: What emotions do my target customers experience in relation to my product/service? This can include both positive feelings when their needs are met and negative emotions when faced with challenges.
Sees: What does the environment look like from my customer’s perspective? This includes what they see in their physical surroundings, online, or in their social circles that influences their perception of my product/service.
Hears: What are my customers hearing from friends, family, social media, and other sources that might influence their opinions or decisions regarding my product/service?
Based on the information provided, please create a detailed empathy map that can guide my understanding of my target customer’s experience and help me refine my value proposition and marketing strategies.
// End of Prompt //
Nothing replaces the interview for customer discovery. However, you can again leverage the power of generative AI to develop an interview script. Although it isn’t necessary to ask someone every question, these will help to frame their answers in experience without subconsciously pitching them your business idea or solution.
Notice that the questions stay out of the “woulds.” In other words, asking people what they “would” do is highly unreliable. For example, imagine I ask you this question: “Would you exercise daily if a gym opened in your neighborhood?” You would probably say yes because of social pressures, but that doesn’t mean you would do it.
Past behaviors are a better measure of future behaviors. Asking your customer archetype what they’ve done results in more reliable customer discovery data than asking them what they would do.
Here are some interview questions generated by ChatGPT that you can use in your customer discovery process:
Last Experience: “Tell me about the last time you encountered [specific problem the product/service aims to solve]. What was the situation, and how did you attempt to solve it?”
Needs and Desires: “What are the most important features or benefits you look for in a [product/service type]? Why are these important to you?”
Value Proposition Reaction: “When you hear our Value Proposition, which aspects stand out to you as most appealing? Are there any parts that are unclear or less compelling?”
Alternatives and Substitutes: “What alternatives have you used or considered to address [specific need/problem]? What did you like or dislike about them?”
Decision-making Factors: “What are the top three factors you consider when choosing a [product/service type]? How do our proposed features align with these factors?”
Emotional Connection: “Can you describe how you feel when you encounter [specific problem our product/service solves]? How would you feel if that problem was effectively addressed?”
Usage Scenario: “How often do you encounter the need for [product/service]? In what situations or contexts do you find yourself needing it the most?”
Feedback on Improvement: “If you could change one thing about the current solutions you use to address [specific need/problem], what would it be and why?”
Referrals and Recommendations: “If our product/service successfully solved [specific problem], how likely would you be to recommend it to others? What would make you hesitate to recommend it?”
Discovering Your Customers: Blending AI Insights with Real-World Engagement
The mantra I repeated daily with my entrepreneurship students: “Get of out of the building.”
Entrepreneurs typically value efficiency, and therefore it’s common to substitute internet research for customer development interviews. While internet research is always helpful, it’s critical to talk to real humans about real problems.
However, once you “get out of the building,” where do you go?
Finding where your customer archetype congregates, both online and in the real world, is crucial for effective customer discovery.
Here are nine tips or suggestions by ChatGPT for entrepreneurs to locate and engage with their target customers:
Online Discovery
Social Media Platforms: Identify which platforms your target customers use most frequently. This can vary widely depending on demographics and interests (e.g., LinkedIn for professionals, Tik Tok for younger audiences, or specialized forums for niche interests). Engage in these spaces through comments, direct messaging, and by joining relevant groups or communities.
Online Forums and Communities: Look for online forums, communities, and discussion boards related to your industry or where your customer archetype might share their experiences and challenges (e.g., Reddit, Quora, or specific forums like Stack Overflow for developers).
SEO and Keyword Research: Use SEO tools to discover what your potential customers are searching for online. This can help you understand their needs, the language they use to describe their problems, and the solutions they are seeking.
Content Marketing: Create valuable content that addresses the needs and interests of your target customers. Use blog posts, infographics, videos, or podcasts to attract them to your website or social media profiles, then engage with them directly.
Online Surveys and Polls: Utilize social media, email newsletters, or platforms like SurveyMonkey to conduct surveys or polls that can help you gather insights about your target audience’s preferences, needs, and habits.
Real World Discovery
Networking Events and Conferences: Attend industry conferences, meetups, and networking events where your target customers are likely to be present. These events offer a great opportunity to meet potential customers face-to-face, understand their challenges, and get direct feedback.
Local Community Events: Participate in or sponsor local community events, fairs, and gatherings. This can be particularly effective for businesses targeting customers in a specific geographic area.
Co-working Spaces and Incubators: Spend time in co-working spaces, incubators, or industry-specific hubs where you can meet other entrepreneurs and potential customers. These spaces often host events and workshops that attract a diverse group of people.
Customer Interviews and Ethnographic Research: Conduct in-person interviews or observational research to understand the behaviors, motivations, and environments of your target customers. This hands-on approach can provide deep insights into their real-world contexts and how your product or service fits into their lives.
By combining online and real-world strategies, you can effectively locate and engage with your customer archetypes, gathering valuable insights that inform product development, marketing strategies, and overall business direction.
Sometimes, it’s not possible to “get out of the building.” You might have limited resources, or an entrepreneurship class might not have students who can go out into the community to do customer discovery.
While not a substitute for person-to-person interviews, generative AI can help augment or enhance the process by accessing a massive data set, including information about your ideal customer archetype.
Here is a prompt:
// Beginning of Prompt //
I am an entrepreneur with limited resources and my business is [name of business, industry or niche, Value Proposition]. My target customer archetype is [paste your customer archetype description here]. Given these constraints and the nature of my target audience, I’m looking for insights on where these individuals might gather online for discussions, information sharing, or community engagement. Specifically, I’m interested in:
Popular Online Platforms: What are the most popular online platforms or social media channels where my customer archetype might spend their time? Please consider both general platforms and niche communities specific to my industry or my customers’ interests.
Forums and Discussion Boards: Are there any specific forums, discussion boards, or online communities (like Stack Overflow for coders) where my customer archetype actively engages in conversations related to [mention any specific interests, problems, or topics relevant to your product/service]?
Content Consumption Habits: What types of online content (blogs, podcasts, YouTube channels, etc.) might my customer archetype consume? Are there particular influencers or content creators who resonate strongly with this group?
Events and Webinars: Given the current constraints on physical mobility, are there any virtual events, webinars, or online meetups that my customer archetype is likely to attend? How can I find these events and potentially participate or contribute?
Additional Online Activities: Are there any other online activities (e.g., online courses, workshops, or certification programs) that my customer archetype might be interested in or participate in regularly?
My goal is to identify these digital gathering spots to engage with my target customers, gather insights, and validate my Value Proposition. I appreciate any guidance on how to approach this customer discovery process effectively within my current limitations.
// End of Prompt //
Generative AI provides yet another unique and novel way to do customer discovery—interviewing the AI. Because Large Language Models (LLMs) have thousands of data points on many aspects of human behavior, they can simulate (in aggregate) a customer archetype and can be “interviewed” in a chatbot such as ChatGPT. “Synthetic data” is the emerging term for this process.
Here’s an “AI interview” for our Airbnb example:
Interviewer: Tell me about the last time you encountered a situation where your accommodation experience was less than ideal. What was the situation, and how did you attempt to solve it?
Airbnb Customer: On my last trip, the place I booked wasn’t as described. The location felt unsafe, and the amenities were lacking, which was disappointing. I reached out to the host first to address my concerns, and when that didn’t lead to a satisfactory resolution, I contacted Airbnb’s customer service for help. They were supportive and helped me find another place, but it was a stressful start to the vacation.
Interviewer: What are the most important features or benefits you look for in short-term rental accommodations? Why are these important to you?
Airbnb Customer: The accuracy of the listing, a safe and convenient location, and clear communication with the host are my top priorities. I look for these because they directly impact the quality and enjoyment of my stay. Knowing what I’m getting into, feeling safe, and having a host that’s responsive and helpful make my travel experience much more enjoyable.
Interviewer: When you hear our Value Proposition of offering unique, verified accommodations with a focus on local experiences and exceptional host reliability, which aspects stand out to you as most appealing?
Airbnb Customer: The emphasis on verified accommodations and host reliability stands out. It reassures me that what I see is what I’ll get and that there’s a dependable support system in place. The local experiences part is interesting, though I’m not entirely clear on how you ensure these are unique and worthwhile.
Interviewer: What alternatives have you used or considered to address your accommodation needs? What did you like or dislike about them?
Airbnb Customer: I’ve considered hotels for short stays and other rental platforms for longer vacations. Hotels are reliable but lack the personal touch and space that Airbnb offers. Other rental platforms sometimes offer competitive pricing but can be hit or miss in terms of property quality and host responsiveness.
Interviewer: What are the top three factors you consider when choosing accommodations for travel?
Airbnb Customer: The reliability of what’s promised vs. what’s delivered, the location in relation to my activities or attractions, and the overall value for money. Your focus on verified accommodations and reliable hosts aligns well with my needs, especially if it enhances trust and consistency.
Interviewer: Can you describe how you feel when your accommodation doesn’t meet your expectations based on the listing?
Airbnb Customer: It’s incredibly frustrating and disappointing. It can cast a shadow over the entire trip, especially if I’m staying somewhere that feels unsafe or just isn’t comfortable. Addressing these issues effectively would greatly improve my trust in a platform.
Interviewer: How often do you book accommodations through platforms like Airbnb, and in what situations or contexts is it most critical for you?
Airbnb Customer: Several times a year, for both short getaways and longer vacations. It’s most critical for me when traveling to new cities or countries, where having a comfortable, safe place to stay is paramount for enjoying the trip.
Interviewer: If you could change one thing about your current experience with short-term rental platforms, what would it be and why?
Airbnb Customer: Improve the accuracy and reliability of listings. There’s nothing worse than surprises when it comes to accommodations, especially negative ones. Making sure listings are verified and as described would be a huge improvement.
Interviewer: If our service successfully solved the issue of inaccurate listings and unreliable hosts, how likely would you be to recommend it to others? What would make you hesitate to recommend it?
Airbnb Customer: I’d be very likely to recommend it, as these are some of the biggest concerns with short-term rentals. My hesitation might come from how these policies are implemented and whether they might limit the range of available accommodations or significantly increase costs.
Here’s a prompt you can use to conduct an “AI interview” in your customer discovery process:
// Beginning of Prompt //
I’m seeking to understand the preferences, behaviors, and tendencies of my ideal customer archetype for my business, [insert your business/product/service]. To do this, I’d like to role-play an interview scenario where you, ChatGPT, will assume the role of an ideal customer who regularly engages with [insert industry or product/service type].
Please answer the following questions, using the information I provide about my [product/service] and the customer archetype I’m targeting.
Last Experience: “Tell me about the last time you encountered [specific problem the product/service aims to solve]. What was the situation, and how did you attempt to solve it?”
Needs and Desires: “What are the most important features or benefits you look for in a [product/service type]? Why are these important to you?”
Value Proposition Reaction: “When you hear our Value Proposition, [insert brief value proposition here], which aspects stand out to you as most appealing? Are there any parts that are unclear or less compelling?”
Alternatives and Substitutes: “What alternatives have you used or considered to address [specific need/problem]? What did you like or dislike about them?”
Decision-making Factors: “What are the top three factors you consider when choosing a [product/service type]? How do our proposed features align with these factors?”
Emotional Connection: “Can you describe how you feel when you encounter [specific problem our product/service solves]? How would you feel if that problem was effectively addressed?”
Usage Scenario: “How often do you encounter the need for [product/service]? In what situations or contexts do you find yourself needing it the most?”
Feedback on Improvement: “If you could change one thing about the current solutions you use to address [specific need/problem], what would it be and why?”
Referrals and Recommendations: “If our product/service successfully solved [specific problem], how likely would you be to recommend it to others? What would make you hesitate to recommend it?”
This role-play will help simulate the customer discovery process, allowing me to gather insights directly from the perspective of my target customer. Your answers will guide the refinement of my product/service and marketing strategies.
// End of Prompt //
Remember, your focus with the “AI interview” is the same as it would be for human interviews—a focus on the problem, not the solution. Concentrate on their pain points and how they have solved them in the past or are currently solving them (or not solving them).
Embracing the Future: The Symbiosis of AI and Human Insight in Entrepreneurship
As we navigate through the intricacies of entrepreneurship in the digital age, it’s evident that integrating generative AI into the entrepreneurial process offers a profound enhancement to the way businesses are conceived, developed, and scaled. From understanding the foundational principles of the Business Model Canvas to reimagining it through the lens of AI, we’re witnessing a pivotal shift in entrepreneurial strategy.
This evolution is not just about leveraging technology for efficiency, but is fundamentally about deepening our understanding of the customer experience, refining value propositions, and discovering where our customer archetypes gather, both online and in the real world.
The nuanced insights and pattern recognition capabilities of generative AI using synthetic data serve as a powerful ally, enabling entrepreneurs to sift through data with unprecedented precision and uncover insights that might otherwise remain elusive.
However, as we’ve explored, the essence of entrepreneurship still revolves around the human element—understanding customer emotions, needs, and behaviors. The tools and techniques provided by generative AI are enhancements, not replacements, for the intuitive, empathetic connections that entrepreneurs must forge with their customers.
The reimagined Business Model Canvas for the Age of AI, with its emphasis on customer-centric elements, serves as a guide for balancing these technological capabilities with a deep understanding of human behavior. This balance is crucial for creating products and services that resonate on a personal level with customers and address their needs in meaningful ways.
The future of entrepreneurship lies in the symbiotic relationship between human insight and artificial intelligence. As we harness the vast potential of generative AI to enhance our entrepreneurial endeavors, we must remain steadfast in our commitment to understanding the human aspects of our businesses.
Note on images
I generated all of the images in this article with ChatGPT 4 with a simple prompt. Here is the exact prompt for the last image in this piece:
Generate an inspiring image in 16:9 aspect ratio for an article section with this heading: Embracing the Future: The Symbiosis of AI and Human Insight in Entrepreneurship
Disclaimer
This document is not an academic paper. At the time of publication, I am not affiliated with any corporation or institution. While I will link and cite my sources when appropriate, I’m not beholden to any format or tone.
The intended audience is primarily educators (teachers at formal educational institutions, life coaches, mentors—anyone who teaches someone else how to do something). However, a core tenet of my belief is that in the Age of AI, everyone will be an educator. And that the best practices educators have developed for young minds also work for young artificial intelligence models.
Also, this publication is not for software developers or coders. It is not a technical manual or industry white paper.
© 2024, Timothy J. Desmond
All rights reserved. No part of this work may be used or reproduced in any manner whatsoever without written permission except in the case of brief quotations embodied in critical articles and reviews.