Representing Customer Segments on Your Opportunity Solution Tree (Hope’s Take)

Have you heard? My new book Continuous Discovery Habits is now available. Get the product trio's guide to a structured and sustainable approach to continuous discovery.

Just like many aspects of continuous discovery, there’s no single right way to use the opportunity solution tree. As a fellow Product Talk coach, Hope Gurion uses opportunity solution trees with customers on a regular basis. And Hope continues to refine and adapt the tree to help product teams get the most out of it.

How do you represent different customer segments on an opportunity solution tree? Do they need their own layer? This post is the first in a two-part series where Hope describes her approach. I’ll share my own thoughts in the next post in this series.
— Teresa

Structuring the opportunity space is hard. It’s one of the toughest parts of learning to use opportunity solution trees.

It’s easy to get overwhelmed when interviewing customer after customer. How do you make sense of all the data?

Oftentimes, teams get stuck structuring the opportunity space because their ecosystem is complex. They have different types of customers. Especially in the B2B space, it’s common for teams to struggle with a simple question, “Who is our target customer?”

But the difficulty in answering that question doesn’t mean we can just ignore it. In fact, it’s all the more reason to dig in deeper and do our best to answer it. Think of it this way: Being customer centric is held up as an ideal in many companies these days. But to be customer centric by definition implies that you know who those customers are and what their specific needs are.

Being customer centric is held up as an ideal in many companies these days. But to be customer centric by definition implies that you know who those customers are and what their specific needs are. – Tweet This

For teams dedicated to continuous discovery practices, deciding who to interview every week is key. Opportunities are written as first-person statements like “I wish…” or “I need…” This means knowing who said these statements is a critical factor when prioritizing opportunities and evaluating potential solutions.

In this article, I’ll walk through several examples of how teams represent different types of customers in their opportunity solution trees. Note that the stories I’m sharing have been simplified and anonymized, but I believe you’ll still be able to learn some valuable lessons from them.

Start with the 5 W Questions

Remember when you learned the fundamentals of writing in elementary school? At some point, your teacher probably introduced the concept of the “5 W (+1 H) Questions.” If you’ve never heard of these (or your memory is a little rusty), they are:

• Who?
• What?
• When?
• Where?
• Why?
• How?

Answering each of these questions is key to telling a story. Take a quick look at the first paragraph of any newspaper article to see this in action.

Here’s an example from a New York Times article about a music festival:

So why is this concept important for product trios?

The opportunity solution tree is essentially a storytelling tool. It helps us explain why we’re doing this work (the outcome) and when and where our customers have unmet needs (the opportunities).

The opportunity solution tree is essentially a storytelling tool. It helps us explain why we’re doing this work (the outcome) and when and where our customers have unmet needs (the opportunities). – Tweet This

The answers to the W questions tee up the other key question, “How?” Our attempts to answer “How?” are reflected in the solutions we include on our opportunity solution tree.

So far, so good. The only problem? We often neglect to mention the “who.” Sure, we know it’s our customers.

But is that category specific enough? It depends.

Sometimes it’s perfectly acceptable to work with the broad category of “customers.” If your customers’ needs are consistent (regardless of identifying attributes like demographic, geographic location, industry, size, role, or level of experience), you can probably conduct customer interviews with a variety of customers. In this case, you’ll learn something valuable each time and expedite your team’s progress to your outcome. But in other cases, you’ll need to dive deeper into customer segments.

And you won’t know which approach is right unless you take some time to be intentional about it.

Why does this matter? When we take an overly generalized approach, we may be neglecting important customers or potential customers. That means we’re not serving as many of the critical people who would expedite creating value for our company.

And the opposite is true, too. If we divide our customers into too many segments and treat them as separate (even if their needs are fundamentally the same), we also risk wasting time and slowing progress to our desired outcome.

Let’s dive into a few examples.

Scenario 1: Uncovering Potential Customers

For this example, let’s consider a medical record-keeping software company. Their customers are medical practices like dentists, pediatricians, and general practitioners. They’ve set their business outcome as maintaining their high retention rate and have decided to use a customer satisfaction score (CSAT) as a predictor of retention, their product outcome.

This is the beginning of the opportunity solution tree for a medical record-keeping company, showing their business and product outcomes. Click the image to see a larger version.

This company initially thought of their customers as a single group—anyone who used their software at a company paying for a license. As they were measuring CSAT using a survey of existing users, the product team identified an opportunity from the comments of users with low satisfaction scores. They captured it as: “I need entering patient information accurately to be fast and easy.”

This slightly expanded version of the opportunity solution tree now includes an opportunity, phrased as an “I statement” from a customer. Click the image to see a larger version.

Seems pretty straightforward, right? Based on input from customers, they identified an opportunity. They decided it was the most important target opportunity to focus on, began working on solutions for that opportunity, and delivered solutions for that opportunity.

There was just one problem.

Addressing this opportunity wasn’t having the impact they expected on their CSAT score or their retention rates.

So they had to dig in further. Why weren’t their decisions achieving the expected impact?

It turns out that their customers actually fell into three distinct groups: the front desk staff, the patient care staff, and the physicians. The team and their leadership had incorrectly assumed that this CSAT measure of success was the best predictor of retention and that the target opportunity was equally important to each customer group.

Adding the different customers to the opportunity solution tree provides more clarity around the relative size and importance of each group that’s linked to a specific opportunity. Click the image to see a larger version.

While all three groups counted as customers, there were some important differences. First, there were far more front desk staff and patient care staff than physicians. But just because these two groups were larger, that didn’t necessarily mean they were more influential on the retention decision. In fact, it was just the opposite. The physicians had much more influence over the decision-making process to retain the product. And the needs of the physicians overlapped, but were not exactly the same as the needs of the front desk and patient care staff.

Through discovery beyond the CSAT survey, the product team recognized the unique opportunities from each customer segment. Adding in the who layer of the opportunity solution tree (indicated in pink in the opportunity solution tree shown below) helped the product team make this distinction clearer. They could now group opportunities under different segments and see the relative size and importance of the group each opportunity was linked to.

Adding the different groups of customers to the opportunity solution tree makes it easier to see which opportunities relate to which groups. Click the image to see a larger version.

For example, all groups cared about entering patient information quickly and easily, but physicians also cared about having the latest treatment protocols and focusing the majority of their time and attention on managing patients.

This example teaches us an important lesson: When the product team jumped from the outcome to opportunities, they missed the distinct needs of physicians because they were overshadowed by the needs of the front desk and patient care staff. It also helped them better negotiate with their leadership to change how they were measuring the most important, meaningful product outcome: CSAT among physicians.

This is why we should take time to think through which customers we need to focus on to most influence our goal or success metrics. There may be differences—size, priorities, influence—among these groups. And understanding these distinctions can help you with your prioritization decisions.

We should take time to think through which customers we need to focus on to most influence our goal or success metrics. There may be differences—size, priorities, influence—among these groups. – Tweet This

Scenario 2: Realizing You Have Too Many Segments of Customers

The next example is from a marketing technology company that offers both a free and paid version of their product. The product team’s desired outcome is to get people on the free trial to convert to the paid version.

The company had determined that three segments existed in their customer base. One is the marketer/executioner at a larger company. They don’t control the budget; they’re the end user. Another segment is a digital marketing agency that offers marketing support to their clients. The third is the person who’s running their own business and doing all the marketing themselves.

This opportunity solution tree shows how the marketing technology company was thinking about different segments of their customers. Click the image to see a larger version.

This seems to make sense. Each of these segments would appear likely to have different needs and levels of influence when it comes to making purchasing decisions.

When the product team was doing their discovery, they recruited from each of these segments. They were trying to determine how each segment would evaluate the free version of the product and what would motivate them to switch to the paid version.

And they noticed something interesting.

There didn’t seem to be a difference. The experience maps for each segment were pretty much the same. It didn’t matter if someone worked at a large company, an agency, or if they were a business owner who would be using the product themselves. There was no real distinction in what motivated them to make the switch to the paid version.

Adding a customer layer introduced unnecessary complexity to this opportunity solution tree since all customer segments turned out to voice the same opportunities. Click the image to see a larger version.

This example also teaches us an important lesson: Sometimes you don’t need a who layer on your opportunity solution tree. Even if you identify different segments, if their needs are not materially different from each other, there’s no need to include them on the opportunity solution tree.

This product team wouldn’t have learned this, though, if they hadn’t taken the time to investigate. So rather than assuming you know who your customers are, make sure you spend some time uncovering and testing these assumptions. As your outcome changes, you may need to revisit the decision about whether and how to represent distinct customer segments on your opportunity solution tree.

Rather than assuming you know who your customers are, make sure you spend some time uncovering and testing your assumptions about this. – Tweet This

Scenario 3: Bringing More Clarity to Your Opportunities by Assigning Them to Specific Segments

Our third example involves a recruiting-related software as a service (SaaS) company. When I began working with the company’s product and technology leadership, they knew they were interested in generating more revenue, but struggled to prioritize among all of the project requests and ideas.

I illustrated their approach with a very basic opportunity solution tree (shown below). You’ll notice that in this stage, it was only a business outcome and some solution ideas—no product outcome, no opportunities, and definitely no who/customer layer.

When many companies first start to use opportunity solution trees, they look like this—just an outcome and some solution ideas. Click the image to see a larger version.

It’s also worth noting that there’s nothing wrong with having “increase revenue” as your business outcome, but this should be much more quantified. Do you intend to generate $50 million? Five percent more than you made last year? Without a specific number, this is really tough to measure and know how close or far you are from your goal!

Instead of believing all these solution ideas were equally important, I asked them to consider: Who would benefit from each solution? And how would it contribute to growing revenue? Would the solution retain existing customers longer or help them acquire new customers to grow their customer base? And by how much? They said they believed they could grow their customer base 3x and wanted to increase their existing retention from 90% to 95%.

Quantifying the potential size of each of these paths to increased revenue helped them compare the relative contribution of focusing on each type of customer (existing vs. new) to grow revenue.

Making some simple revisions, like adding numbers to quantify the paths to increased revenue, makes it easier to compare ideas. Click the image to see a larger version.

Next, we started to fill out the tree with opportunities. They had heard things like, “I can’t believe you don’t have single sign-on (SSO). It’s 2021!” and “I don’t want to endure 12 clicks to post data on your site vs. 1 click on your competitor’s.”

Adding in the customer layer to the opportunity solution tree helped the product team relate solution ideas to different segments. Click the image to see a larger version.

As we went through this exercise, the leaders began to have some important realizations. These opportunities and solutions had come from different people. Some came from a salesperson at their company, some came from a potential buyer who used an SSO solution like Okta, and so on. This meant they were actually addressing different needs for different segments—prospective buyers and existing customers.

We started to group our opportunities by who they came from. Then we could relate potential solution ideas to who really matters. For example, SSO can be broken down into customers who use the various SSO providers like Okta, Ping Identity, and Azure. We could estimate which percentage of prospective customers indicated which SSO solution they rely on and see which prospective customer segment is biggest before committing to supporting any one provider.

Here’s our updated version of the opportunity solution tree.

This revised version of the opportunity solution tree dives deeper into one segment of prospective customers—those who are looking for a single sign-on solution. It helped the product team see that some opportunities might carry more weight than others. Click the image to see a larger version.

By thinking about who has a particular need and the potential size of customers who care about having that need solved, we can see that some opportunities might carry more weight than others. Being specific about the who layer of the tree helps us identify that solving one opportunity or solution may not be as impactful as solving for others. Is supporting SSO from Azure before Okta the most important need to solve next if only 10% of your customers use it? It might be, but what’s important is that the leadership team can now make a more informed decision about this choice.

This example shows us how adding a who layer can help us assess and prioritize. When your opportunities and solutions are addressing different groups, the who layer makes this explicit and also helps you size the segments and their relative needs.

Tying It All Together

It might sound obvious: Not all opportunities are equally impactful on our desired outcomes. Sometimes it requires exposing who expressed the need to see this explicitly and assess, size, and prioritize among those customer segments. But unless you take time to make who you need to learn from or who expressed this unmet need explicit in your discovery, you could very easily be making some risky assumptions. And moving forward without uncovering these assumptions means you’re either ignoring some groups and not addressing their needs or focusing your attention on groups that don’t have as much ability to impact your outcome.

Not all opportunities are equally impactful on our desired outcomes. – Tweet This

You might realize, as in Scenario 2, that even though you have different segments, their needs are not really that different. You might see that your experience maps and interview snapshots for these distinct groups end up showing the same patterns. And that’s completely fine. In these cases, you don’t need a who layer on your opportunity solution tree. But you arrived at that realization through an intentional process, not by assuming all of your customers were the same.

Our goal as a product team is to expedite making an impact. We want to move the needle on that outcome at the top of our tree. And the best way to get there is to benefit the most customers in a way that most benefits our business. In order to achieve this, we have to start the beginning of our discovery process with a key question: Who do we most need to learn from?

Our goal as a product team is to expedite making an impact. We want to move the needle on that outcome at the top of our tree. – Tweet This

When you ensure your opportunity solution tree answers the 5W questions, you expose critical customer and business context. It’s essential to surface this context before you attempt to answer “How?” through potential solutions.

Why? Because this context will help you be more influential and increase the impact of your solutions. It will help you be more influential because you’ll have all the key components of storytelling and specific evidence to convince stakeholders, leaders, and partners why you’re choosing your target opportunity. This context will help you be more impactful when conceiving and evaluating potential solutions because you’ll know who will benefit, the context in which they’ll be using the solution, and what its potential impact is on your desired outcome.

The combination of your credible influence and the impact of your decisions on your outcome is what expedites creating value for customers. After all, isn’t expediting that impact what we most want to achieve with our continuous discovery?

We hope this post gave you some new insights into how to approach creating your opportunity solution trees. Stay tuned for our next installment, where Teresa will be sharing her take on this topic!