It's never a great sign when the Product Manager is handed a technology with an assignment of "figuring out the use cases". Great products should be a labor of love, the result of an entrepreneurial person who felt the pain of a problem first-hand, or had great empathy for someone else's problem, and then passionately invested time and energy to solve that problem.
Zoom founder Eric Yuan apparently left his job at Cisco when he saw first-hand all the problems and pains that users were having with WebEx and decided to found a company to solve those problems. Some of the most popular Electronic Medical Records were created grassroots by doctors who knew first-hand all the problems of operating a medical practice and learned to program software by themselves just to improve their practice.
You would not ask these passionate entrepreneurs to go "figure out the use cases". They've had them in mind from day one.
But not every company is in that position. Some startups had a use case in mind when they started, then discover that that use case that they built the technology for is not something the market is ready to pay for. Some products solved a use case profitably for many years but the market has changed and the use case is no longer relevant. Some products have a use case in one industry and are looking for other applications in other market segments. Some large companies have inherited technology on the shelf and are - obviously - looking for a way to monetize it.
Looking for a use case is a common, though not ideal, exercise for a Product Manager.
Real-World Example of Searching for a Use Case: NFTs
At the time of writing, NFTs are a new technology in the news every day, part of Silicon Valley's vision of the Web3 future. In essence, NFTs are blockchain versions of art you can find online. They might be JPGs, GIFs, or MP3s that people want to collect, just like collecting baseball cards.
I have spent time in earnest to understand NFTs. I started by listening to two enthusiastic a16z podcasts on the topic and must admit they were awfully sparse on use cases, even the one literally titled NFT Use Cases Today and Tomorrow.
Many, many buzzwords. Lots of description of how the technology works. Few concrete examples.
As I kept listening and reading, I noticed: this is a lot like the process a Product Manager goes through when they are assigned a new gig. They are told by company leadership about a high-level product idea. The engineering team describes the technology to them in great technical detail. And then they're asked to come up with "use cases".
So let me take advantage of the current interest in NFTs to outline the steps I would follow to surface the use cases for any technology.
1. Understand What Technology Can Do...
In your first days investigating a new technology for its use cases, you'll be bombarded with buzzwords from the business and not-always-relevant technical details from engineering. But what is noise and what will real users actually use and pay for?
In the case of NFTs, here are some things I heard about the underlying blockchain technology:
2. ...and Be Real About Its Limitations
It's also important to get clear not only on what the technology can't do today, i.e. its limitations. Today's NFT technology has well-documented issues:
Whether these limitations could be overcome on the future roadmap is an area of active work and certainly a polarizing topic!
3. What Use Case Hypotheses Exist Already?
Surely there are already ideas in the company about the use cases of the technology. What use cases come up most often when discussing the technology in-house? As you talk to the sales, marketing, product, engineering, and CS teams you'll start to compile hypotheses.
When it comes to NFTs, google "NFT use cases" and you'll get plenty of hypotheses as well: NFTs for real estate, NFTs for fashion, NFTs for the metaverse.
The most common hypothesis is that NFTs will help artists and supporters of artists be compensated fairly.
The story goes like this: creators of art, music, writing are not compensated fairly because middle men. These middle men include traditional agents as well as the big internet platforms who take big cuts and create barriers to entry. For example in music, I read that Spotify and record labels take their cut, it’s estimated that musicians typically get to keep just 10% of the revenue from the art they create.
NFTs on a blockchain could cut out middle-men and allow better compensation for creators and/or more creative compensation tied to royalties as the blockchain tracks the provenance of those NFTs. Supporters of art, music, writing, etc. may benefit financially by attaching their names to the NFTs and potentially taking some kind of long-term cut or royalty. And new content platforms who have a barrier to entry due to entrenched platforms may flourish as they have more democratic access to content and creative business arrangements with creators via NFTs.
4. Frame it in Terms of Personas and Problems
Use case is an old-fashioned term. Today's Product Managers recognize that they are actually Problem Managers, that is to say they need to frame everything as a market problem to be evaluated, prioritized and solved.
Moreover, use cases are vague and don't necessarily tap into the person whose problem you are trying to solve. This is why the discipline of describing use cases in the form of personas and problems is important, to ensure you really have understood the target user and empathized with their pain.
Pragmatic Marketing even suggests articulating use cases in an agile user story format can make sense:
As a <persona>, I have <problem> that causes me <pain>. I have a <goal/desire> so that <benefit>.
In my NFT example, the hypothesis would be: "As a struggling JPG artist, I don't make much money even when my art does very well and is copied all over the internet. I believe it's because of middle men that take too big a cut. That causes me frustration and grief as it is my main profession, and I often consider changing careers. I would like a way to be paid inline with the popularity of the art I produce, so that I can be compensated fairly and develop my career."
As described in Know Your Target Personas, the language should sound the way the actual person would speak. I go through this exercise with clients and ask "Does this sound artificial or does it really sound like the actual target person expressing themselves?" An honest assessment provides a lot of clues as to whether you have a credible use case.
5. Follow The Money
You'll hear all about people's hypotheses in-house, but the next step is to understand what use cases actual customers are putting down money for. What leads, opportunities and especially revenue are already associated with this technology, and if so, what are the major use cases driving that sales activity?
In the case of NFTs, there are lots of sensationalist reports about select NFTs selling for thousands and even millions of dollars. However these appear to be one-off's and rife with scams. I personally have not seen much evidence of real-world artists making money routinely from creating NFTs, leading many to speculate that the use case is theoretical.
If your technology has been available for several years and you can't point to the intended customers consistently paying money for the technology, that is something to immediately dig into.
6. Look at Competitors and Substitutes
It's not clear to me that this artist use case is something that artists can't already get easily with existing solutions. Isn't reaching your fans directly for compensation already achieved by the likes of Patreon and GoFundMe?
An article entitled Why NFTs Are Better Than Patreon sheds some light:
Right now, the best way for creators to get around Facebook, Google, and the other middlemen of the world and directly monetize their fanbase is through platforms like Patreon. The platform offers low fees in exchange for allowing creators to deliver exclusive content to their subscribers. It sounds like a great deal, but there are a few problems.
Whether you find these advantages over Patreon to be credible, at least there is obviously a persona and a problem because there are existing solutions that the persona is paying for today (Patreon). Now that we have it expressed in a clear persona/problem format, we can go validate this with real-world users.
7. Validate Use Cases With Real People
Once you have some use cases articulated and some real market analysis to back it up, there is no substitute for going to real potential customers and asking about the use cases directly. I've written about this at great length. Ironically, a lot of company leaders are bad at talking to customers to validate their product idea. They either find it too uncomfortable to hunt down prospects to have a meeting, or they are just so enamoured with their technology that they see getting outside validation as a waste of time. Mistake!
With every customer conversation, you learn so much about the context and nuances about the real persona, problem, and "use case". Talking to real people is where you really learn the details that will help you craft a product that is valuable.
If I had to validate the NFT artist use case we've been talking about, I would literally schedule a dozen coffee meetings with artists and other online creators and have a conversation, or even engage a consultant to do it with me to help remove bias.
I've seen some media reports such as CNBC's These millennial creators are making 6 figures selling NFTs: ‘It changed the trajectory of my career and my life’. And there are also plenty of articles arguing the opposite, such as The Atlantic's NFTs Were Supposed to Protect Artists. They Don't that argues "no ordinary person is choosing a blockchain-based technology over its traditional counterpart. More than a decade after blockchains first caught tech geeks’ eye, not a single smartphone app that you use with friends or co-workers relies on that technology. By contrast, when the web was the same age that bitcoin is today, it had half a billion users around the world."
As the Product Manager, I'd go talk to real artists and decide for myself.
8. Be The Voice of The Market
Let's sum up the information we've gathered:
This is the "voice of the market" report you deliver to your boss and leadership along with your proposed use cases. Too often I see PMs fulfill their assignment of developing use cases by simply going through the motions and writing down the ideas they heard from others internally, or coming up with ideas without real validation. In particular, some will be very reticent to express bad news such as "We were not able to find any good use cases." But this is exactly what you need to do - provide not only your best effort use cases but also an objective report of your findings.