Anyone who has ever generated a product idea knows that when the muse strikes, it creates a high. You have energy. You’re excited about the possibilities. And you are overly optimistic. This excessive optimism can lead entrepreneurs to jump right into building the product, bypassing the important research that will reveal if there’s a strong market for it. Validating your product idea doesn’t have to be resource-heavy or require months of time to complete. Here’s a six-step process to help you validate a product idea (and adapt it) before you invest in building it.
1. Start with the Problem, Not Your Idea
In order to fully validate a product idea, you should start with the problem you intend to solve. What is the precise problem? What frustration does it create? Who has this problem? Try to distill your problem down to a statement that spells out what the problem is and how it’s causing pain for the people it impacts.
2. Evaluate Existing Solutions
Next, evaluate all the existing solutions to the problem. These solutions may take a form similar to your idea or they may be completely different. For example, if a young family is struggling to cook healthy meals while balancing careers, childcare, and community commitments, the solutions are wide-ranging. The family could solve the problem with a close-by grocery store with a variety of healthy prepared foods, order healthy frozen prepared meals online, subscribe to a healthy meal kit service, or hire a personal chef.
Within each of these categories, there is a multitude of options. You need to be sure you have a broad perspective of all the ways your target audience could meet their needs.
3. Identify Deficiencies in Existing Solutions
Examine each of the broad categories of solutions you identified in Step 2, looking for deficiencies. Are there ways the solution doesn’t fully solve the problem? Does the solution introduce new problems?
In the example above, for instance, weaknesses abound in each category. Grocery stores with healthy prepared foods are unlikely to have options for people with food allergies or special diet requirements. Frozen prepared meals ordered online may also not fully serve those with food allergies or special diets, and they aren’t environmentally friendly. Meal kit services typically require 30-45 minutes to prepare each evening, and young families may not have this time available. And personal chefs are usually outside the budget of the average family.
Once you’ve analyzed the broad categories, dive into each to look at specific products and services. Evaluate each of them to see how they’re addressing the weaknesses of their category.
Understanding these weaknesses will show you where opportunities lie. And this evaluation will also tell you if a similar solution already exists.
4. Determine if Your Target Audience Can Pay for a Better Solution
Once you’ve identified an opportunity for a solution that’s meaningfully better than what’s already out there, you need to know if there’s a market willing to pay for the solution. First, determine how much it will cost to provide the solution. What is your price point?
Second, look at each market niche you’ve noted as needing the solution. Are they willing to pay for the solution? Finding the answer to this question can be tricky because this is not simply a matter of your market’s income level. Someone with a household income of $200,000 may not be willing to pay $25 a month for a solution if the pain isn’t strong enough or the solution you’re offering isn’t substantially better than what they’re currently using at a lower price. And someone whose household income is $50,000 may be happy to pay $100 a month for something that fully fixes a problem that greatly impacts their quality of life. The next step will help you know how much people are willing to pay for your solution.
5. Get Feedback from People in Your Target Audience
Gathering feedback is, perhaps, the most important step in the validation process. It’s where your assumptions are either proven or disproven. You can use a variety of tools to communicate with your market and gain feedback, including social media, surveys, and one-on-one interviews.
- The ways they experience the problem
- How well their current solution is working
- The significance of the pain caused by the problem
- How much they would be willing to pay to fully solve the problem
6. Run a “Fake Door Test”
The validation process doesn’t stop at Step 5 because people don’t always behave in ways they say they will. This is true due to the effects of cognitive biases. While it’s important and valuable to hear feedback from your prospective users, you don’t want to skip the final step, which is observing what people actually do when given the opportunity to purchase your product at your target price point.
You don’t need to have a product to do this. Simply run a “fake door test.” Fake door tests can take a variety of forms and use several tools, including a landing page, Google ads, and social media ads. Your fake door should look exactly like the real thing, with a real checkout process. However, you’ll stop the process before the prospect completes checkout — so their credit card isn’t charged. At this point, you’ll show a message saying that the product is not yet available and you’re gauging interest. You can add a form to your response page, inviting people to “Sign up for an email alert when the product becomes available.”
Fake doors have two benefits. First, they allow you to get an accurate idea of what people are actually willing to pay for your product. Second, if you include a form to collect the email addresses of interested prospects, you have a ready-made list of people to market to as soon as you launch.
Reduce Risk When You Validate a Product Idea
If you validate a product idea before you build it, you’ll dramatically reduce the risk involved in launching a new product. You’ll save both financial and time resources as you decrease the amount of iteration you’ll need to do.