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They were under the impression that they should be launching early and launching often. Investors and friends were telling them that these were the tried and true methods for any business. However, they were not having any success with these techniques. Customer Discovery at DropboxĪs previously noted, Dropbox’s biggest problem upon launch was that they were trying to apply traditional marketing techniques to their business. Four steps of the Customer Development model at Dropbox 1. They then tried to use Blank’s method to learn more about their problem and attempt to come up with a solution.
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The founders at Dropbox discovered Steve Blank’s Four Steps to the Epiphany as they were dealing with this problem. Growth of any kind was good but it is hard to perpetuate that growth when it is unclear where the growth was coming from. Essentially, Dropbox was throwing money away on marketing channels that were not driving customers while still seeing a growth that was unexplained. Yet, these traditional marketing methods were not what was causing the company to grow. The team was taking the advice of investors and mentors and using traditional marketing methods. The team at Dropbox had engineering experience but almost no marketing experience to speak of. Founded by a couple of engineering students from MIT, it was accepted into the prestigious Y Combinator seed accelerator and saw rapid growth.
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The Problem at DropboxĪt first, the Dropbox story sounds like a typical Silicon Valley fairytale. As of June 2015, Dropbox had captured 400 million registered users. It offers basic customers 2 GB of free online storage space and allows them to scale up to the paid service as needed. While this sounds like the typical tech explosion story, the difference between Dropbox and other companies is that Dropbox did this without doing any advertising.ĭropbox uses the freemium model to draw in customers. Unlike its competitors, Dropbox managed to capture huge swaths of the market and the service grew from 100,000 users to several million users in just 18 months. Founded in 2007, Dropbox entered a very crowded market around the time that the cloud was beginning to explode. It offers both commercial and personal cloud storage of all sizes. In this article, you will learn how two of today’s most successful startups used customer development – Dropbox and Groove.ĬUSTOMER DEVELOPMENT MODEL AT DROPBOX What is Dropbox?ĭropbox is a file hosting service based in Silicon Valley. However, it is just as helpful to learn about how some of today’s most successful startups have employed the Customer Development model successfully. Blank’s book is full of valuable case studies that illustrate his points well. Reading about the Customer Development model is all well and good.
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