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What to Do When You Don’t Have the Right Customer

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It’s unfortunate, but there are times when you realize that you don’t have the right customers. Sometimes, you simply acquired people who were originally interested in your product but aren’t excited enough about it to pay you or to stick around long term. They’re happy to occasionally use what you make for free, but they’re not about to give you any money or get their friends to join.

Other times, you can have a very excited group of early adopters, but you realize that the market they represent simply isn’t big enough to sustain the product. This happens a lot when you start with a group of “earlyvangelist” users who tend to be early adopters and have very specific needs that may not scale.

And, of course, sometimes external things happen, and the market itself changes—like streaming video luring people away from video rentals and cable TV. In this case, you might have had an enormous, captive market, but a better, more innovative solution comes along, and suddenly you’re fighting to find a new group of people who want what you make as your original users drift away to the competition.

In order to survive, companies in these situations need to seek out new markets, often by changing their products in ways that will alienate their current or remaining users. This is painful, both to the company and to the customers, especially when they’ve been together from the beginning.

Cindy has been through this twice, at Yodlee and Kissmetrics. In both cases, they had a loyal and enthusiastic user base that simply wasn’t large enough to support the business, and the companies had to make some tough decisions.

This can be one of the hardest decisions you’ll make as a product manager. It’s painful to stop supporting people who have been good customers. It feels awful to hear people complaining about being abandoned. And it’s never fun to voluntarily give up revenue from people who are happily paying you. But if there aren’t enough of them or if they’re not willing to pay you enough, sometimes this step is necessary, and you’re better off doing it quickly.

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