You’ve got your next big idea for a winning product or service. No one else has this offering — no other company has your game-changing vision.
You’re confident that customers will line up in droves once you launch your innovative business idea. After all, you’re obsessed with your product — surely your ideal clients will be, too, right?
Well, not exactly…
Many entrepreneurs get so excited by their vision that they eagerly dive straight into product launch mode. There’s just one problem: You’ve yet to conduct market validation to ensure there is actually a desire for your offering.
Don’t waste your time, resources, and energy on a product your target market doesn’t need or want. Instead, master the art of market validation and set yourself up for lasting success.
What is market validation?
Market validation is the process of validating your business idea before you launch your product or service. Primary market research helps you gain valuable information about your target audience, the industry, and the competition to secure product viability.
In other words, you want to know if there’s a need for your product — if your offering helps move your target audience further from pain and closer to pleasure.
Market validation helps you do precisely that, so you can guarantee your offering will attract paying customers from the get-go.
I’m an entrepreneur, too — I understand how exhilarating it is to think up your next big idea and share it with the world. However, while it’s tempting to dive straight into branding and product promotion, a little bit of homework will save you a lot of potential heartaches.
A few simple questions and the correct data analysis are all it takes to ensure there’s a demand for your product. Plus, you’ll better understand the competitive landscape, so you can launch your product with confidence.
How to conduct market research for startups
Businesses that launch products based on their “gut feeling” rarely succeed. It’s harsh, but it’s true…
According to CB Insights, around 70% of tech startups fail. One of the top reasons?
No market demand.
Don’t become another disappointing statistic. Guarantee product-market fit when you follow this formula for market validation that works:
1. Start (and keep) talking to your target customer
If you want to sell to your target audience, you must get to know your ideal customer.
The more information you gain about your buyer persona, the better.
Now, market validation doesn’t stop once you’ve answered a few questions about your target market.
Think of your business like an organism — it lives and breathes and changes. So, too, does your competitive landscape.
Continue talking to your customers every week. You’ll gain priceless qualitative feedback to make necessary changes to product development. Plus, you’ll guarantee customer satisfaction from the outset.
2. Gather data for your market research
You’re ready to start chatting with your ideal customers. Excellent!
Your next question probably is: How to conduct qualitative and quantitative market research for a startup?
I recommend two approaches to market validation:
1. Conduct customer interviews
Overwhelmed by the thought of time-consuming conference calls or awkward one-on-one interviews?
Thanks to social media and email marketing, there are simple ways to get to know your ideal customer quickly. Simple tactics like:
- Setting up an easy two-question survey on a Thank You page.
- Sending out a brief questionnaire to your email list
- Using social media to poll your audience
- Testing ideas with low-cost PPC ads
Be sure that if you’re using social media, you’re talking to your target market — not your Aunt Jean, who will support your online endeavours even if she doesn’t understand them.
For more in-depth online focus groups, consider surveying potential customers on sites like PeopleFish. Designed for market research for startups, you’ll get valuable data and insights from real people in your target audience.
2. Gather keyword research and search data
When it comes to market validation, both qualitative and quantitative data matter. A few of the easiest ways to use metrics to explore your product’s potential are keyword research and competition analysis.
Inexpensive tools like Keysearch provide great insights into keyword search traffic and help you gauge your competitive landscape.
Is there a high volume of search traffic with relatively moderate competition? This tells you there is a demand for your product or offering in a not yet oversaturated market.
Inversely, if there is little traffic and low competition, this could be a sign that your industry or product is not viable.
3. Test your product on a small scale
You’ve conducted preliminary market validation, and the data shows that it makes sense to pursue your product launch. Excellent!
Before you spend months creating a costly and complicated marketing campaign, it’s time to test your offering on a small scale.
This is your go-to-market strategy — a way to guarantee product-market viability. Use it as an opportunity to discover what works (and quickly ditch what doesn’t.)
To sum it up
In an age where anyone can start a business or launch a product online overnight, you can make impressive wins simply by taking the time to talk to your target audience.
I love this simple but effective quote by author and marketing maven Dan Zarrella:
“Marketing without market research is like driving with your eyes closed.”
Just as you wouldn’t hop behind the wheel blindfolded, avoid the urge to launch your next big idea without the proper optics.
Learn how to conduct market research for a startup and test your product idea with real target customers; you’ll prove market validity while gaining invaluable industry insights.
Once you’ve learned about your market, leverage this information to improve your offering and better meet your customer's needs… that’s where the magic happens.
Still feeling overwhelmed by interviews and data analysis?
We’re here to help. Schedule a free consultation call to learn more about our market validation strategies, so you can grow your business with confidence and ease.