“Ideas don’t come out fully formed,” the Facebook CEO said. “They only become clear as you work on them. You just have to get started.”
Vetting the market need
Just because you want something doesn’t mean anyone else does. Entrepreneurs regularly fall prey to this line of thinking, identifying a need and designing a solution without questioning whether the niche they’ve found can sustain an entire business model. In fact, a recent study by CB Insights concluded that the No. 1 reason startups fail is a lack of market need for the company’s offering.
Your friends might think your idea is great, but when launch day arrives, will they buy enough of your product to keep your new company afloat?
Without a fresh infusion of outside opinions, products become disconnected from their audiences. Friends and family are more interested in supporting you than helping you build a great product, so while you can keep them involved in your efforts, don’t mistake their cheerleading for genuine market insight.
Idea-vetting isn’t a one-time task on a checklist. As your product progresses along its development cycle, you must continue to put it in front of users for critique — or risk straying too far from the solution the target demographic truly needs.
Developing a viable product
Just because you haven’t encountered a solution doesn’t mean the solution doesn’t exist. Entrepreneurs frequently gloss over deep-market dives, only to discover halfway through development that someone else has been tackling the problem for years with an effective solution.
Testing the market viability of your product means researching current options and honestly investigating whether the problem is being solved well enough. Most thriving markets worth selling to have more than one major player; but whether their solutions truly address your audience’s needs is up to you to discover — as is whether the market has room for another contender.
If you’re unsure whether your idea is just an interesting conversation point or a dream worth pursuing, follow the following steps to vet your idea before taking the plunge:
1. Solicit objective feedback.
Everyone likes to imagine that Apple’s success can be attributed solely to innovation, but the truth is more practical. Thanks to market viability testers like the Apple Customer Pulse research group, the tech giant has been able to determine which needs to address — before bringing new products to market — making it appear that the company is always “a step ahead.”
Your friends and family will want to tell you nice things — even the smartest and most successful will. But to determine whether your idea is viable in the market, seek out the opinions of people who don’t care whether you succeed or fail.
2. Compare market needs to your surveyed responses.
If the people you survey would never use your solution, their feedback shouldn’t be the last word. Rather than take your test subjects’ word for it, perform market research and compare the results to those survey responses to get a fuller, clearer understanding of whether your potential product is worth fleshing out.
Countless market research firms are available to tackle this gap in your knowledge, so make those connections before jumping into an industry you may not fully understand. According to Small Business Trends, 11 percent of startups fail because their founders lack experience in the market. Don’t contribute to that gloomy statistic — consumer research until you eliminate all doubts as to whether your solution addresses a real need.
3. Assess the competition.
If your objective test subjects give you the go-ahead, and your market research says the solution will sell, look at other companies in the space. What are they doing, is it working and are there gaps in the current solutions?
Reach out to a company such as Owler to perform a competitive analysis for your offering. This kind of business intelligence can offer insights on the current state of your potential industry and show whether your idea actually has a viable shot.
As more people in the business world jump into entrepreneurship (and it is a welcome step), we need to work together on raising the bar when it comes to building world-class products and executing on a well-defined vision. New entrepreneurs need to leverage the knowledge of other more established entrepreneurs who have had a few battle scars.
Innovative ideas are the backbone of entrepreneurship. But for every great one, there are hundreds of ideas better left alone. The next time the light bulb in your head snaps on, follow these steps to see whether your inspiration is worth pursuing.