You’ll get the funding to launch it in no time, and it will scale like clockwork until you’re earning seven figures a month. Easy, right?
Think again. Like it or not, the overwhelming majority (somewhere around 97%) of new businesses fail. One of the biggest reasons for that is what investors like to call “product market fit.”
In other words, businesses fail because people build products no one needs or wants. Here’s how to check your idea before you start.
Step 1: A Bit Of Research
It all begins with a bit of research. Many new business concepts are based purely on the business owner’s personal ideas, conceptions, and biases about what is or is not needed in a market, and because of this it’s easy to get off track.
The first thing you should do with your new idea is to take it to Google. See what kinds of products are already out there in your industry, and try to assess whether or not yours could fit in.
Also try to put yourself in the position of your prospective customer and figure out when and why people would want your product. Then figure out what they’re searching for or where they’re spending their time online, and see if it’s possible to reach them there.
That could mean evaluating click prices, search traffic levels, or types of online communities.
Step 2: A Test Campaign
Another step to figuring out whether or not there’s a market for your product is to run a test campaign. You can do this quickly and easily by throwing a landing page, or other type of splash page, and try to “sell” your product.
Even if you don’t have a product or service to sell just yet, you can still track how people perform on the site and whether or not that indicates interest in the product. Better yet, have people sign up for an email list to be first to know when you launch. That way, you’ve just validated your market and found your first customers all in one step.
Step 3: Talking to Customers
Finally, its time to hit the pavement and start talking to customers. If you do this in the right way, you’ll find that most people are very receptive to people who come to them looking for information on how to solve their problems, rather than those who come trying to sell a solution.
Put yourself on your customers’ side and learn what they think their needs are. Believe it or not, you can actually get people to more or less design your product for you, by telling you exactly what they need and what they don’t.