BUX Podcast 98: Thinking Like a Lean Startup

We’ve recently had some clients whose main expertise is in the world of Brick and Mortar businesses. In helping them with their websites, we’ve had to introduce them to a new way of thinking. Their businesses all deal in physical goods. For them, the way to get something done is a two step process: plan and execute.

This works wonderfully well when applied to their businesses but when it comes to building their website, creating their sales funnel, and creating a digital marketing plan, it leaves something to be desired.

There’s a feeling that we have to get it “right”. That we have to essentially have everything figured out before we proceed to the site design. This perspective often leads to procrastination and projects that overshoot their deadlines. Why? It turns out that the pressure to get things right is paralyzing. From the client’s perspective, they’re paying for a specific good: a functional website. Once it’s done, that’s it. We release the little guy onto the Internet and wait for the leads and/or money to come in.

But in my experience, this simply doesn’t happen.

one does not simply build a website that makes obnoxious amounts of money

The solution lies in The Lean Startup, a crazy popular book by Eric Ries. Don’t get too tied up in the word “startup”. The definition of a startup that the book uses is “an organization formed to search for a scalable and repeatable business model”. Its principles have been adopted by tiny family businesses, global corporations, fledgling startups, campaign organizers, charities, and even religious groups. Basically, if you want a business to make money, be efficient, be scalable and repeatable, this is the business method for you.

For our purposes, the Lean Startup method is useful in two main areas: customer development and in the design process.

Customer development online has historically come from a “build it and they will come” mentality. I can still remember dealing with clients who wanted to put information on their website for no other particular purpose than “it might be something interesting to people when they’re surfing around”. Lean Startup principles reject this passivity in favor of collecting continuous feedback that has a material impact on the direction of a product or of the business every step of the way.

The design process that the Lean Startup advocates is the exact opposite of what my Brick and Mortar friends are doing. Rather than seeking to build the ultimate website, it looks to build –> measure –> learn. It pushes the idea of a Minimum Viable Product (MVP) and iterating into a better, more profitable website. And while this may sound like more work than building out an entire site and calling it a day, this method was developed specifically to save time and money when creating a new product or service.

The benefits come in not building what you don’t need. By starting with an MVP one can see early results which will prove or disprove your concept. The next step is to collect data and subject it to analysis. The analysis will show what’s working and what’s not and will suggest changes to make for the next iteration of the website. At this point, it’s simply a matter of rinsing and repeating until you’ve met your goals.

The key here is measurement. As management guru Peter Drucker once said, “If you can’t measure it, you can’t manage it.”

The Lean Startup book is now a series. I’ve been reading through Lean Analytics recently and can’t recommend it enough. In my view, it’s a practical book for Lean Startup practitioners. It provides the answers to the crucial question, “What metric should I be using to grow my company?”

Check out the podcast for more. And get into the Lean Startup. Seriously.

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