You have a startup idea. You are excited. You believe your idea will change the world - a common assumption all of us have when it comes to our ideas. However, you have not built anything as yet. You are minding about how to build the product. You are so excited that you can’t wait and go on to building the product. You have the hypothesis and you know in your heart that your product is going to kill it. You just need to build it and get it out there. As they say, if you build it they will come. You know if you build it, customers will flock to your doors. While all these are good, the best thing for your business would be if you take a more realistic approach to build your product.
If you are serious about building a business and if you are serious about not wasting your time and money and efforts in doing things that would not result in any positive outcome, you better tame your excitement a bit and take a more practical approach to take your idea to the market.
Instead of straight going into building the product, I would suggest, which most experts do, that you validate your idea. Validating your idea means trying to understand whether your hypothesis holds true when it comes in contact with reality.
Business happens in reality, which happens to be quite different from what you find exciting in your mind. Validating an idea means testing your hypothesis regarding your idea bringing it into contact with reality. It allows you to understand whether there is a real market need for your product. It helps you to refine your idea using the feedback from people who will eventually be using your product. Validating will save you time, money, and effort.
Now how to approach validating an idea when you don’t have a product as yet. There are no hard and fast rules. But there are approaches that work better than others. The first step to validating your idea is talking to people - anyone who would like to listen to you.
People have a misconception. Particularly when it comes to startup ideas that if they share it, people will steal it. This is a gross misunderstanding of how things work. Ideas rarely get stolen. Often two people can have similar ideas. Rarely ideas are original. If you are talking about some invention, that’s different. Otherwise, ideas worth little unless you implement them.
There are several upsides to talking to people about your idea. You get free feedback that you can use to modify your idea. It helps mature your idea. Most important, you can gauge whether there is an interest in people in your solutions.
Apart from talking, people have developed a number of approaches to idea validation over the years, which you can use in validating your idea with some modification. While standard idea validation approaches such as survey and research have limitations, the structure has also many upsides as well that we often like to overlook. Here some of the approaches that you could use to validate your idea.
Talking to potential customers, competitors, and experts
Regardless of your approach, you need to be talking to customers. Talking to customers often is the most useful technique to understand whether there is a need for your product in the market. Similarly, speaking with the existing players in the market and sector experts can offer you insights that you are missing. When you are talking to customers, experts, and competitors, it is better to follow a structured approach so that you can keep the data and analyze it for future reference.
Although the survey has got a bad rap for being not so effective a mechanism for understanding the market, it remains one of the relevant and widely used tools in idea validation. You design a number of questions and talk to your potential customers and stakeholders to understand whether there is a need for your product.
While surveying you should be mindful of the common mistakes of surveying and work hard to reduce the authenticity problem of surveying. Before starting the survey, it is useful to work on selecting your target customers.
Some of the aspects you may include in your survey: i) relevance - whether your idea is relevant to the potential customers ii) usefulness - whether your solution is useful iii) uniqueness - whether your solution is unique enough to differentiate in the market iv) NPS - whether people would be willing to share your solution v) likeliness to purchase - whether they would like to pay for your solution.
Real-time audience buildup
Social media and blogging have brought an unprecedented opportunity where we could share and collect feedback from users in real-time. If you are working on an idea, you could share about your work and progress with your network online in real-time seeking feedback, while at the same time building an audience as you go on to polish your idea.
Low-cost prototyping and then taking it to the market to gather feedback is an excellent approach to understanding what the market needs. Many people consider this to be a more effective approach to checking idea validation because it is more realistic.
Build a landing page and ask people to pre-sign up for updates. You could also ask for pre-orders. Response to both will give you an understanding of the state of the market. Landing pages are useful. Apart from asking for sign-ups and using that as a proxy for whether people are sufficiently interested in your product, it also allows you to collect feedback.
MVP and rapid feedback
The most useful approach to understanding whether there is a demand for your idea in the market is developing an MVP and testing it out in the market. MVP, as the name suggests, is a minimal viable product that you could build with minimum cost and effort. If you have already had done enough initial research, MVP can help you in rapid development as well. The upside of an MVP compared to other approaches is that MVP is more real and the feedback is no more hypothetical because you will be selling or showing a product to your customers.
Key questions to answer when validating your idea
Why should you care about idea validation: because it will save you time, effort, and resources. Often we assume that our idea has a ready market and it does not need any reality test. And we go on to build a product that eventually fails to get enough traction. Whereas a simple practice of talking to customers, keeping a mindset of constant experimentation, getting feedback from customers, and then building could save you a lot of hassles and resources and significantly improve your chance of success.
It is not necessary that you follow a hard and fast rule to validate your idea. At the heart of idea validation: you should spend time understanding that there is a need for your product in the market. The best way to understand it is through talking to your customers, as many of them as possible. Use a systematic process to collect and analyze authentic customer feedback using minimum resources and then establish a process to use customer feedback in developing your product. Be always open to ideas and be willing to change your product whenever there is legitimate market feedback for doing so.