Get ready to land your first 10 Customers this week!
Welcome! Today, let’s explore Initial Market Testing.
This is the third part of our Start-up Development Series with Philips Evarist.
You’d be glad you did!
Owning a start-up or intending to start one can seem to be a Herculean task! But it’s not! Trust me!
Let’s take a look at the concept – Initial Market Testing; it’s Dos and Don’ts and get you to land your first 10 customers on that new product or service!
This third part is definitely for you!
I would be exploring in detail:
- What Initial market testing is?
- Initial Market Testing; Dos and Don’ts;
- Activities to help you do an actual Market Testing?
What is Initial Market Testing?
At this stage, it is assumed that you already have your MVP (click here to know more about MVP) . The next step is to do a market testing.
Initial Market Testing involves the processes of getting validation of your MVP from your target market.
This is by taking it to your target market with the aim of discovering whether or not it is market worthy and if your target market is willing to give you their money (pay) in exchange for product or service.
Until people begin to pay for your product or service, it is not yet validated!
Market Testing is not a product launch or promotion. Don’t get this wrong! It is the process of determining whether your product or service is of interest to a given target market; you identify some potential customers and take the product to them.
The purpose of initial market testing is simply to validate your idea and extract immediate customer feedback so you can be able to build a user-centered product.
In customer feedback, you get information on user experience, you get answers to questions like: Does my product or service solve the problem that it was intended to solve? ; do the assumptions behind the ideology of the product hold?
The feedback could take weeks or months to generate. The reward, however, is that you get to know whether or not your product or service is useful to the customers.
I’ve discovered over the years that with the right approach, even inexperienced entrepreneurs can bring amazing products to market with excited buyers on the first day!
Initial Market Testing; Dos and Don'ts;
- Write down Your Product Concept
Let’s face reality! You have made a lot of assumptions and the sooner you can test them, the less risk you will have when launching your product.
The questions to ask when writing your product concept include:
– Who is your customer?
If you say “everyone,” you are already setting yourself up for a tough time. Be sure to get specific.
–What problems are you solving?
What this means is being explicit about the problems your product solves. By writing down these problems, you can validate whether customers also see them as problems and more importantly, whether customers think they are problems worth solving.
–How does your product solve those problems?
How does solving their problems make the customer’s life better? Does it make them more money? Look better? etc. you have to be clear about this.
– What are the key features of the product?
The features need to be more than cool; they need to solve specific problems; more quantitative (e.g. time saved, money made), the better.
- Remember that most of What You Write Down is Assumptions. This is why they need to be tested. It means that a lot would change once you hit the market.
- Start with Your Network: I recommend working with your own network and the networks of friends, mentors, investors, and others to reach potential customers.
- List your first set of prospects and schedule a meeting with them: Interview them. Start with a list of questions but deviate from the questions as you learn more information. Approach the conversation with a sense of curiosity about the customer’s problem and needs, and you’ll get some really valuable insight.
- Ask “why?”:
“Why?” is by far the most important question you can ask. With it, you can get closer to the truth from customers. Unfortunately, this question isn’t used often enough; too many people ask a question, and then take the answer at face value. It’s a missed opportunity to understand motivation and validate what someone would really do.
The “Five Whys” is a great technique for getting to the underlying reason – the real reason – behind a customer’s motivation.
A quick example can be a 5-why’s session with a potential customer for digital skill training.
Q: Why do you want to learn python programming?
A: I want to learn because I want to be a web developer.
A: because web development is a skill found in the future of work.
A: because technology has made the world a global village and businesses need websites to be online.
A: because Websites are used by businesses to create a virtual version of their brand that can be accessed by everyone anywhere.
Heads-up! Our activity is going to be on the 5-why’s!
In order to effectively use 5 Why’s, you should have a ‘questioning outlook’ towards problems and not taking them at their face value.
6. Find the Value Proposition:
The value proposition is the expected gains that a customer would receive from using your product. Value can be quantitative, such as time saved or additional revenue earned. Measuring this is usually straightforward. Value can also be qualitative, such as pain relieved or lifestyle benefits your product provides.
- Liking Your Idea is not the same as Buying Your Product: Unfortunately, validating a product idea with prospective customers is subjective. There is no black and white answer. In fact, because people are generally nice and want to please you, be careful about accepting their answers at face value. When someone tells you enthusiastically “it sounds great,” or “that’s an interesting idea,” your first reaction should be to follow-up with “why?” It’s important to understand that someone liking your idea is not the same as buying the product. Your challenge during your lean market validation process is eliminating as much of these “false positives” as much as possible. If you have followed us to this point, you’re good to go.
Now jump off the cliff and have some fun validating your product or idea!
Activities for the Week.
- List 10 potential customers in your network and sell your MVP to them.
- Have the 5-why’s session with your teammates or potential customers, and write down the root cause of the problem(s) you’re trying to solve.
If you encounter any challenges or have any questions during the process, feel free to leave a comment in the description box.
You can also join our Whatsapp group or join the Live Webinars for this Startup Series.
You can join the live sessions every Thursday at 8 pm, using this link bit.ly/beatingthelockdown