Answering this question requires answering a different question.
Think back to a new product launch, like the iPhone.
Buying the first iPhone required a leap of faith because there was nothing remotely like it. If you were one of the early adopters who stood in line to buy the first iPhone, you didn’t get to first test-drive the iPhone. You probably saw Steve Jobs’ keynote demo, fell in love with the promise of the product, and decided to buy the product.
It follows then that what customers buy isn't really your solution, but a promise of better.
Getting your customer’s attention is the first battle. This is the job of your unique value proposition (UVP).
The next step is convincing your customer that you can deliver on your promised UVP. And here’s the counter-intuitive bit. This is not the job of a working product, but a demo.
The art of the demo is showing the smallest thing possible to convince your customers you can deliver on your UVP and close the sale.
Once a customer buys-into your demo, the last step is pricing. If the cost of your product is less than the value of your UVP, a sale is made.
UVP + Demo + Pricing = Offer
Customers don't buy a solution, they buy an offer. This insight is key to acquiring customers without a product. It opens the door to using a Demo-Sell-Build strategy.
While an offer is an effective device for testing interest and selling your product before building it, your offer's success is still predicated on the quality of the input assumptions you captured on your Lean Canvas.
If your UVP falls flat, or your demo fails to convince prospects, you don't make a sale.
Here’s a 3 step process for systematically building a compelling offer: