How Sales and Product Work Together to Achieve Product-Market Fit
How can you build a product based on feedback and observations, all while staying true to the problem you’re trying to solve in the first place?
On this week’s episode of Better Product, you’ll hear from Rod Feuer, Co-Founder and Chief Strategy Officer at Costello, an AI-driven software platform designed to help salespeople sell better.
When it comes to Rod’s target market, he knows his users. He understands exactly what they do, how they do it, the way they make decisions, and what is important to them.
In this episode, you’ll learn how Rod and his team eagerly seek feedback – listening to their customers and not just doing what they say, but taking it a step further, interpreting it based on their knowledge of these users’ behavior and needs.
If you’re struggling with your product-market fit – or what that even means – this episode is for you.LISTEN NOW
Anna: When it comes to digital product, we live in an era of hyper competition. You've seen it. There are market maps where there's like 1000 logos on a page saying, "Featuring our tech." That's how it is in almost every industry now. For product sales teams, the focus is on more. More calls, more outreach, more emails, more activities, more logos on their pages. The dominant strategy is to just fill the pipeline.
Christian: Fill the pipeline.
Anna: Thanks you sales bot.
Christian: Right, and at some point more starts to equal less. In an environment of more, more, more, the only thing you can do is be better, create better and sell better. That's what Rod Feuer is going to talk with us about today.
Anna: Rod is the Chief Strategy Officer and co-founder of Costello, an AI driven software platform designed to help sales people sell better.
Rod Feuer: Costello was started to help people sell better. That's what we do through our conversational playbooks, through the AI things that we're building to actually help identify what works in calls, and make sure that you answer in the right way or have plays to run when bad things happen.
Christian: Before Costello was a product, it was an idea. One thing the founder, Frank Dale did, was conduct interviews and actually secure customer contracts before a dime was ever raised, or a product was ever built.
Rod Feuer: I was one of his interviewees, and in that session I'd have the problem that he wanted to solve, and I could also kind of see the future in terms of the product road map. Like you can say like, I see what we're going to build first, but I also see all these other things that we could go do with this. Like the information we could glean from this would be so valuable for product, and marketing, and all these things. I was fortunate that he asked me to be his co-founder.
Anna: When Rod joined this new venture, he quickly figured out what their first challenge was going to be, people.
Rod Feuer: We are in the business of solving for behavior change, and that's a really, really hard product problem. That's a really hard people problem.
Christian: The sales reps, the end users, already had a way of doing things, and back to the people problem, it takes a lot to get people to do things differently from what they've been doing. For Rod, one of his first challenges was to design a UI experience based on what reps were already doing, what was natural.
Rod Feuer: There was a pattern that existed, so we had to take enough of that pattern so that they weren't like, "This is so new, I don't want to do it." Yet make it better and usable in a natural way.
Anna: Because they already had existing customers, Rod had to figure out how to bridge the gap between product development and delivering on the promises already made. He shares this great story about how he took one of those initial customers and just watched them use the V1 version of the product.
Rod Feuer: You just can't substitute observing your end customer, and then being able to be there and ask them questions afterward of like, what would have been better? What would have worked this way? What was challenging? There's just no substitute for that, and we continue to do that today.
Christian: When you have a new product, you're essentially introducing something novel, something new into the world. As a first time product person, Rod did something most founders overlook.
Rod Feuer: The first principle behind it, or a best practice, is to take something that they're kind of already doing, or that there's a pattern for, but then make it better. Versus doing something totally wholesale. People might say they want something new and innovative, but if you put in front of somebody, they're just not going to, the uptake won't be there.
Anna: When you go to build a product, you actually have to make something, duh. More than that, you're creating an experience. Beyond just identifying an opportunity, you have to think about the new product in three ways. What's the problem that we're solving for? Is it usable? Does it add value?
Christian: It's great that they were able to observe people while building the product. Sometimes though, that observation can be a trap, in that those being observed are actual edge use cases.
Anna: Edge cases meaning people who are potentially using a product in the way other people won't be using it. Really kind of taking the product to the edge of the core value you're offering.
Christian: Right, and I think when you're observing, it might not be the entire scope of who the product is meant to serve.
Anna: Let's start there. How do they think about building the product, the edges if you will, based on customer feedback observations, while staying true to the problem that they're solving for?
Rod Feuer: How do humans behave? Because if you understand that, you know when you're pushing the edges too far on novelty. As an example, so we've taken strides too with our products to say, hey, we know that the call screen can't be distracting. Simplicity, non-distraction, but it has to feel like the future.
Rod Feuer: If you set some norms up, or some experience pillars, so to speak, of like, our first principle is of design, so to speak, or our first principle is of user experience. That's a great place to start, and we've actually built out some of those things. If you hear something where you're like, this violates one of our principles of design or user experience, or quite frankly doesn't lend itself to the value pillars of consistency, like our product's supposed to drive consistency, and it's supposed to provide visibility into performance. If it doesn't meet those two value criteria, or violates our user irreverence pillars, then it's probably not something we should build.
Christian: You talk about first principles. You talk about experience pillars. Are these communicated internally amongst your product team? Is everybody sort of aware of these?
Rod Feuer: Yes. It helps, we've got a short document where we document some of these things. For example, some of them are obvious that I think are pretty natural for a product. We need to eliminate as many clicks as possible, because sales people are super impatient. The average person, impatient with clicks. Sales people are hyper, like any extra movement they have to make, especially on a call, is like terrible.
Rod Feuer: For example, we don't have any save buttons anywhere. There's one place in the app where we have a save button. Any time they type something, it must be saved automatically, so that they don't have to think about it. If they lose data, like data loss for us would be horrendous. Like, I took all these notes, where'd they go? We do everything we can in the product to save everything immediately. That's like a very obvious but yet kind of subtle design principle of like just if they type it, it's saved.
Rod Feuer: There are other things around, is it CEO ready? Some of our analytics, like can you literally take a screenshot of it and put it into a PowerPoint so that no one has to ask, what does this mean? Just the answer pops off the page. If it doesn't do that, we haven't done our job. We've retooled our analytics to be CEO ready in that sense.
Rod Feuer: Those are just a couple of examples. There's another one, now that I think about it, which is, there always needs to be an escape route.
Christian: In any product, or in your experience?
Rod Feuer: In what we do. Like there needs to be more than one way to do something. If someone's having a problem finishing a call, we have to give them a way to go back. There can't be any dead ends, unintentional, even as small as they might seem, there has to be a second way to do things so that they can always use the product. If one thing breaks, there's another way to get out of it. Think about sales people, if you interrupt their workflow, revenue's not coming into the company, so we do everything we can to make sure that their workflow is rock solid and has redundancy. Because if they can't use us, they lose money. If they lose money, they're going to stop using it.
Anna: The experience pillars are really interesting, and it sounds like they're very deeply rooted in your company's wanting to understand your customers, to watch your customers use the product. It sounds like you have a very deep understanding of them, how they like to work, the things they like and don't like. How are you pushing them forward to adopt the Costello way?
Rod Feuer: If you give them something they can't live without, they're going to adopt what you're going to do, to get to that thing. Being very specific, our big insight was we were kind of getting lost in the fact that, wow, our existing customer base is giving us great reviews, high MPS scores, and they're expanding their revenue, they're growing with us. We're like, we've got this great product. Our real problem was like convincing other people who weren't automatic adopters, who were early adopters and could see the future. We had to convince, and that's like 5% of the population, we need to get everybody else.
Rod Feuer: It really is around, hey, what is the one thing we need to build that if we show it to people they're like, "I will do whatever you want me to do if you can give me this result." We had always planned to go do this next phase two of what we're doing now, around analytics and showing people what happens on a call, what works and what doesn't. Because once you see that, give them x-ray vision into a call, it changes their life. It's changed ours, because we use our own product. That is how you get behavior change.
Anna: We've talked with other companies, and one thing we've heard a bit about is the idea of partnerships, or integrating with other products. I know that this is something that guys have explored. I'm curious your thoughts about kind of, in regards to Costello, and kind of in general, your opinion about partnership with other companies.
Rod Feuer: The reason why you do partnerships obviously is it extends your go to market in a really leveraged way, if you can do it. They can be difficult. I think what's been interesting about partnerships is typically, because of the work you have to put into it, you do those later in your life cycle as a product.
Rod Feuer: For us, and given the space we play in, it actually makes sense to do it earlier rather than later. With product, we've integrated with a company called SalesLoft. They do essentially they're in the sales engagement space. They help sales teams send emails and make phone calls in a cadenced way. It's a programmatic way to prospect and to sell to customers. They have massive distribution. They have 2000 plus customers. They are one of the leaders in the space. The keyword, they have distribution. They have end customers who are in sales, who need what we do, and so we have been fortunate. It's been a very authentic relationship where we've gotten to know their partnership and product person.
Rod Feuer: We have a shared philosophy around what we want sales to be like, and we've been fortunate to, we help solve a problem for them and they help solve a problem for us. That's how we think about it. We're solving a core problem for the same customer, and they have great distribution, so it's a win/win.
Christian: Was this a conscious effort, or was this just like, hey you're on the internet one day like, hey, these people do sales software, let's partner with them.
Rod Feuer: Yeah, so here's how we got there. Great question. Where we got there is workflow is everything to reps. We have to be integrated with workflow or they won't want to use us. For sales, the workflow is everyone has a system of record. It could be Salesforce, it could be HubSpot, whatever. That's not a great workflow tool, well our perspective. It's a great system of record, it's where data's stored, but reps don't really use it to get their job done.
Rod Feuer: They do use sales engagement tools, especially on the prospecting side, like a SalesLoft, to execute their day to day job. If you don't fit into the tool they use for their day to day job, they're not going to use you. It's plain and simple. Our insight was, man, for prospecting reps, which is different than like the SDRs of the world, BDRs, they want to be on one screen most of the time. Because that's their, the SalesLoft engagement tool, or outreach, those are their, that is their screen. If you can't fit into their screen, not that they can't use you, it's just harder. We're like, well, they have a captive audience. This is how reps are working. We need to fit into that workflow.
Christian: How did you even figure out that they were using SalesLoft to begin with?
Rod Feuer: Because from the beginning we had high customer overlap. We use SalesLoft and we use Costello. A lot of our customers use SalesLoft, and then they started using Costello. Just sales engagement tools are kind of the engagement layer on top of a lot of CRMs, and so it's sort of like the system of engagement, if you will, versus system of record, and you've got to fit in with that.
Christian: You noticed this even from your own experience that there's some overlap there. From that point somebody could say, "Well maybe you're competitors, or there's a problem there." Some people might even look at that and think, oh, we shouldn't even go after the space, they're already there. You looked at it, and is that when you started thinking, we should go after a partnership deal here?
Rod Feuer: What happened was, like I said, it was very organic. We ended up meeting Sean Kester, who's their product partnership guy, and we started talking to him. He liked what we did, he saw it as complimentary to what they do. They're in the, they're helping people be more organized and do more outreach with fewer people essentially. He's like, "You plug a gap for us, which is helping people, once they get on a call, what do they do?" He brought us in, he said, "I want you to come talk to more people on our team." That's how it worked. We talked in a few conferences, he liked what we did, and we just, I think part of it is persistence and keeping up, and having authentic conversations with them. Then it happened kind of naturally.
Christian: Seems like in the beginning you already had some people there that had bought it, so you just want to make sure you're actually designing and building it for those people. You're probably still also overseeing that as well now, but you're also now like, okay, we have something that's working. We've got these early adopters, but how can we grow it beyond that? I'm curious how you balance those, in your role, how you balance the growth versus the product quality.
Rod Feuer: I think the balance is, if you have customers who are growing with you, so spending more money with you, who are giving you good MPS scores, and who are giving you good G2 Crowd reviews, and you're in touch with them enough, you generally know like, man this ... You're looking at their usage, because we have usage built into our product, so we can see it. The customer can see it, we can see it. We have all the indicators.
Rod Feuer: Once we feel like that's stable and growing, like we have negative churn, which is, yay. Then it's like that problem is solved for now. We've gotten to the good enough place, we now need to focus on like growing sales, and building things with the product to not just give the early adopters, the people who are aligned with you out of the gate, we've got to get the rest of the world excited. It becomes very easy things like, great, we need to move to new business, and that's our sole focus.
Christian: Does that trying to get new business fall into the product, or does it fall more on the connections, the partnerships, those sorts of things, the outbound sales stuff on your side? Where does that fall? Where does the responsibility lie in terms of the product and growing the user base?
Rod Feuer: I think we're in this, like I said, special zero to one place, where if you talk to people who are out of that, they will tell you sales leads the product. I think that is typically true, but not in the zero to one space. It can be, but for us, like I said before, if sales is getting a lot of meetings but not pulling through, and the assumption is the messaging's good enough and they're executing well enough on calls, then the answer is product. The answer is, product isn't there yet.
Rod Feuer: I think Mark Andreessen says, "You know when you've achieved product market fit because you can feel the market pulling at you. If you're not feeling that pull, product." To me that's the, and that's where Frank just was like, "Guys, people are happy with us, our customers, like let's stop screwing around there. Let's go, we just we need to make that 10x feature." Which we were planning to do, it's just like, we need to do it now. Not three months from now. It needs to happen.
Rod Feuer: Within three weeks we went from concept to execution, and sure enough.
Christian: You decide the growth really it sounds like the responsibility is largely in the product of this then. Do you have a 10x feature idea? How did that come about?
Rod Feuer: We always knew what this thing was supposed to do in the long run, like that analytics piece. It was just a matter of doing it. Honestly it was a matter of just designing and building it, but we knew what it had to be. It had to be a visualization of the call that in a pretty decision tree format. It's very intuitive. We heard people say, "Oh, so it kind of seems like a decision tree." That's exactly what it's going to look like, and you know what? That's exactly what we built, and when we show it, people just kind of go, "Oh yeah." It's so intuitive. It's just so obvious you're like, "Why haven't we always had this?" We hear that a lot, it's like, "Where has this been?" This just seems like so fricking obvious.
Christian: Let's ask you that question. Why didn't you have it from the beginning?
Rod Feuer: We had to build an experience. People had to use the product first, because if they didn't use it to take notes, then we didn't have a product. What happens is you start to build this thing, and then it has to be built into the workflow. Because if it's not built in the workflow, no one's going to use it. Step one, use the product.
Rod Feuer: We actually have a slide from our pitch deck with investors of like, step one, build the Trojan horse, was literally what ... There's a Trojan horse and a deck, and that's called this workflow thing. Then after that it had, gather all this proprietary data to then go find what works and what doesn't. Then you build this virtuous loop. Like I said, it was always there.
Rod Feuer: To your point, should we have done it sooner? Potentially. I think probably like three to four months could we have probably reprioritized a little bit? Yeah. In the meantime, we made decisions with growth in mind, like we did a HubSpot integration, because there are HubSpot partners who are, it's a wonderful community and ecosystem that's been very beneficial to us. We built that integration instead, and that was a good idea.
Rod Feuer: We did build product that was top of funnel oriented. At some point it was like, we've got to get to the data. Because Frank, quite frankly, no pun intended, was hearing from like VPs of sales, "Can you show me what works and what doesn't? Can you show me what questions matter and which ones don't?" He's like, "I'm tired of getting this question." I'm like, "Well that means it's time to build the feature." That's what we did.
Anna: The V1, that was the get your product in the market, get validation that it's working. Then you saw where you could update some things, make it better, that was V2. It sounds like V2-
Rod Feuer: Uploading the core experience was V2.
Anna: It sounds like at the end of V2 is where you found that product market fit, where people were enjoying it.
Rod Feuer: We're on the cusp to be-
Anna: You're on the cusp, okay.
Rod Feuer: With the analytics releases we've done in the last two months, we are knocking on the door of product market fit. We believe with our next release that we will have arrived.
Anna: How will you know?
Rod Feuer: As I mentioned, the pull through will be there. All the meetings being set, conversion rates on those meetings will go up. Top of funnel inbounds will go up. Both volume and pull through of your leads will increase.
Christian: In two years what do you think it looks like?
Rod Feuer: We believe that real time decision making is like a thing. That is the broader vision. We believe that anybody who's customer facing needs augmentation from, or not needs, it's just going to happen. They're going to have machine learning and AI helping them make better decisions in the moment when they're talking to customers. If you're anyone who talks to a customer over the phone, you're going to have something intelligent talking to you, with quotes, in some kind of way so that you deliver the best possible experience to that customer. We believe that we can be that solution.
Anna: When we were talking earlier, you mentioned kind of that Costello's is bringing the inevitable future. Is that what you mean by that?
Rod Feuer: You nailed it. We believe it is inevitable that sales people, or any customer facing person, will have some sort of, like I said, AI driven copilot, which is what Costello is, helping them in the moment have better conversations with customers. Giving them the information that customers need when they ask for it. That's what how we're going to help you.
Christian: What do you think will be the biggest barriers to you achieving the growth that you expect to see?
Rod Feuer: I'll come back to the original. Behavior change can be hard. Humans, they always say, "It's the beginning of 2019, I'm going to go on a new diet. I'm going to start exercising." No, I have not done those things yet. We don't always do what's best for us. The reality is in sales it's inevitable. Someone, the people who are hungry and who know what works, they're going to adopt that thing. If you don't do the thing that helps you, someone else is going to, and given hyper competition, you're going to lose to those people. There's going to be a strong incentive over time to move in our direction. That's our hypothesis.
Anna: What does better product mean to you?
Rod Feuer: Better product means making people's lives better.
Christian: That was Rod Feuer from Costello. You can learn more about their product at andcostello.com. That's A-N-D-C-O-S-T-E-L-L-O.com. Now don't go anywhere just yet. Anna and I are going to dig into the details of Rod's product story here in a second.
Anna: MVP features. Rod talked a lot about they had the vision, but they started with some of these out of the gate features that they knew could then get them to that 10x feature. Christian, what are your thoughts about that?
Christian: I have a lot of thoughts about that. Thanks for kicking-
Anna: Shocked. I am shocked.
Christian: Yeah. Well I think the unique part about this is that, well a lot of times I think we talk about MVPs in terms of just trying to figure out what's working. In this case it almost feels like they knew what they wanted to do with the product, because they have a pretty good understanding of the field of sales, and they know the behaviors that they want to sort of foster using the product. The MVP to them almost felt like, here's the stair step we're going to take. We already kind of know where we're going to go, which is these analytics features, so let's make sure that we build the product in a way that starts leading towards supporting that.
Anna: It's almost like planned obsolescence in a way, but in a more positive way. Because when he talked about the initial kind of sales tracking tool, he used the phrase diminishing returns. It was kind of getting people on board, getting people using it, fitting in with their workflow. Then people, once you have that, people want what's next.
Christian: In order for them to figure out how to actually grow the product, he mentions I think edge cases or extreme users a lot. I'd love to hear your thoughts on that, given your background, and how you would actually figure out, what's an extreme use case that you want to support versus one that you actually think, "Oh, this person's doing something in a cool way that I want to sort of model off of."
Anna: Edge cases are interesting. We talk a lot about edge cases I think in product, where we say, "Oh, I'm not supporting, that's an edge case. It's not going to happen very frequently, I don't need it." I think in research there's this concept of extreme users that we talk about a lot. The idea there is, if you really want to understand a market, a thing, a people, a process, you go to the extreme users because they are using it to 11. They are pushing something in a way that other people aren't. Sometimes the idea is you can draw insights from extreme users that will, it's like if you can design for those people, everybody else will be able to get value out of that.
Anna: I don't know that that's the case here. I think when it comes to product I don't know that your extreme users are the people that you want to be designing for. Maybe they're the ones that help you build those edges to say, this is a little beyond who we're supporting. We understand them, we understand their processes, but these people will never be happy with our product because they're so far out on the edges.
Christian: Right. Maybe that's where some of the confusion, or at least even from my experience of a power user versus an edge case. I think I typically look at power users as being, well we're not totally worried about that type. When you're working on a product that's been around for years, or decades, because they're going to do things their way.
Christian: When I was working at Autodesk, which makes AutoCAD software and was founded in 1982, they were not a graphical user interface in the beginning, it was all command line driven. There were engineers that were drawing engineering plans all through command line in these LISP routines. When I was working there in the mid 2000s, there were still a lot of those users. The UI had built up. They had all these toolbars and all these tools, but there was a whole class of these power users. It really didn't matter what you did, they were so entrenched in that way of doing things.
Christian: I don't know that that was really the type of user we were trying to change. To your point, in this case, for Costello and for these sales reps, you're more using these extreme users as inspiration, rather than thinking of them as a power user.
Anna: Yeah, and I think it ties too to what we talked about with Miles Grote and Tyler Hill from Upper Hand. Tyler talked a lot about workarounds, and I think power users are a great source of workarounds because they are getting things done, and they have pushed your product to the extreme. I think they're a great source of opportunity, of next features, or kind of where you can push a product.
Christian: Yeah. I think you are also hitting on one of the things that is true here, which is you have to know your domain pretty well to be able to have that judgment. In the Upper Hand case, I think Miles talked about getting the whole team out to visit some of their users, so they all got to understand how people were using it. In Rod's case, with the smaller team in a startup, they're getting out there talking as well, but they also have a really entrenched, I guess a really deep knowledge of the sales domain.
Anna: Yeah. Rod knows his users. I mean, the way he talked about they have no save buttons, there's always a way to get out. I think he's very much internalized his users, their processes, what they care about, in that it's like his empathy is so deep he can like see through their eyes in a way.
Christian: Understanding how to treat the extreme users and user that to kind of lead your product is really useful. The idea that he brought about leading towards that 10x feature in analytics, which was a couple years out from when they started founding the company, is all great. The challenge I think maybe some of our listeners will have is, okay, what do I do in between then? If I know I've got a 10x feature down the road, but I'm not ready to do that because my users aren't ready, or the market's not ready, how do I actually lead towards that? Rod's answer to that was, by leading with experience pillars.
Anna: It's like almost constructing these experience pillars he said, "Everything that we do has to kind of fall inside of this." Every time they encounter something that is an edge case, if it's not inside those pillars, they're not going to address it. To go back to our default of a house analogy, it's a strong foundation by which you understand, this doesn't fit in the house because we've constructed this very clear framework of how we want this, or what the vision of our product is.
Christian: Then if you have questions on, hey this person's doing this in a different way than we expected, should we put that in the product? The answer is, well how does it line up to the experience pillars? I remember him saying consistency was one of them, and so they're trying to instill the value of consistency in a sales rep's workflow. The answer to that question is, well, if this is supporting consistency, then it's something we could consider. If it's an outlier that doesn't support that experience pillar, then we dismiss it as being an undesirable activity or behavior.
Anna: Thanks so much for listening to the show this week. If you haven't yet, be sure to subscribe, rate and review this podcast. Until then, visit innovatemap.staging.wpengine.com/podcast, and subscribe to learn how you can take your product to the next level. As always, we're curious, what does better product mean to you? Hit us up on Twitter @innovatemap, or shoot us an email at email@example.com.
Christian: I'm Christian.
Anna: And I'm Anna, and you've been listening to Better Product.
Christian: Better Product.