By Hanan Awaad
I believe that one good idea is enough to attract all the luck in the world and working hard on this idea is a crucial requirement for success. However, when they get an idea for a product and service, business people or entrepreneurs need to validate it and make sure that out there will be individuals who are willing to pay for it.
Last week, I received a question from a reader on how to validate a business idea. In this article, I share a 5-steps process to do the same.
1- DO NOT REINVENT THE WHEEL
Many entrepreneurs get excited about their new idea that will revolutionize how things are done, yet, they fail to recognize that their idea, service or product is already launched in the market. I was talking to a young engineer, who had an idea to design a robot to perform specific tasks in oil fields. A quick google search resulted in several companies in Germany, USA, and Russia that already manufacture similar versions of the robot.
However, many ideas are not so authentic that there are no existing similar products or services in the market yet you can still validate them. If you can improve some aspects of an existing product or develop a new method to offer a service, your business idea might work.
2- DEVELOP A PROTOTYPE
I was working with a company specialized in scientific communications. They had an excellent plan to publish a new magazine in a particular market niche. They developed their pitch and presentation to attract funders. They worked hard for several months, yet they could not reach their goal. Once they produced a sample of the intended magazine, they were able to help their target audience (funders and investors) to understand the product and see how it will look and feel.
In his book, The Lean Startup, Eric Ries introduces the term ‘minimum viable product (MVP).’ Your MVP is not the end product; it is just a lousy prototype of your product, idea or service. The real value of building an MVP is testing your idea.
3- Start Your Focus Group
Be your own marketer and gather a focus group of potential customers and knowledgeable professionals in your field. Ask them questions and solicit their suggestions. There are many groups and meet-ups around the world, either virtual or actual real groups that you can turn to and test your idea.
I was working with a consultant who wanted to launch his training program on handling biohazardous materials. By getting involved in some meet-up group and offering his 30 minutes presentation, he honed his program and developed his facilitation skills.
4- TEST IT WITH REAL CUSTOMERS
Unless there is some safety concern, ask real customers to try your product. Release your prototype or MVP to a limited number of clients. Nowadays, many marketing companies establish testing clubs of customers representing the target market, audience, and demographics of the product or the service intended. This will allow you to receive valuable feedback from those testers about their experience and also suggestions for improvements.
5- GO WITH YOUR INTUITION
When Sony had the idea o manufacturing the first personal stereo, many doubted that such a product would sell. In late 1970, the Sony Walkman shaped our teen cultures for decades and decades. It even set the ground for the iPod and similar products. Just imagine if Sony disregarded the idea based on the feedback of the doubters, where would we be now.
A huge part of being a successful business person and entrepreneur is to take risks. No matter how much you research your idea or research the market, there will always be elements of uncertainty and possibility of making mistakes and even to fail. Accept that you have to take risks and listen to your gut feeling.
Bonus Tip: CREATE A DEMAND
Publicize how your idea will solve customers’ problems. Solving a problem, saving money or effort or time, or introducing some fresh product that will raise dopamine levels in customer’s brains (tackle their emotions) are ways to succeed.
It is a common practice in recent years that companies will launch a product or service while in the development stage. They even ask customers to pay for it or book it with a down-payment.
Originally posted 2016-11-24 22:37:47.