It happens to everyone. You’re walking down a proverbial street and see someone struggling with a mundane everyday task. Channelling your inner telemarketer, you think to yourself: ‘there must be an easier way to do that.’
A few hours later, an obligatory ‘Aha!’ moment ensues. You think you found the perfect solution, but being the serious entrepreneur that you are (go you), you’re not yet sure if the market will agree. So now there you are, facing a business dilemma of your own. You may be onto something, but don’t really feel like wasting a year’s worth of salary to fully develop a product and thoroughly test demand. Once again, there is, in fact, an easier way. Do it.
Market research done right
If you’ve ever seen an episode of Shark Tank or Dragon’s Den, you already know why you should always test your business idea first. Too many budding entrepreneurs spend a small fortune building a product nobody actually wants to use. You might think selfie sticks for dogs are the next Uber. But until you get market confirmation, you’re just a guy saying ‘selfie sticks for dogs are the next Uber’.
Of course, there’s the good, the bad and the ugly of doing market research. Having your family and friends fully on board with your idea is far from a solid proof of concept. Most people think properly validating your idea takes too much time, effort and resources before getting relevant insights. Most successful founders disagree.
Let’s assume you’ve already covered the basics. You’ve identified your target audience. You’ve analysed their pain points and come up with a unique value proposition. It’s then time to get some much-needed feedback.
Keeping it lean
It’s the definition of MVP (minimum viable product) for online markets. You create a landing page and set up paid ads on Google and/or Facebook for relevant keywords. Track conversions, follow up on leads. Sink or swim, all in less than a week.
A friend of mine recently had an idea for an app that allows you to show support for your favourite sports team by repeatedly tapping your phone during games. Kind of like Twitch for soccer, with a very simple interaction model. He called it ClickClapp.
Before even thinking of hiring a developer, he wanted to test if anyone would actually use the app. He created a landing page in a matter of hours. He used a tool that offered a 30-day trial period, although marketing tools aplenty.
He briefly described a product, announced the app was ‘coming soon’, and set up a form for people to subscribe. He made sure the Call to Action was ‘above the fold’ and was instantly visible when you load a page. He also knew landing pages with interactive content such as videos and tutorials convert better, but even that was considered too elaborate for this stage.
Next up, he ran a Google Adwords Campaign. He used Keyword Tracker to find relevant keywords with high search volumes and low competition. Longtail (highly specific) keywords were less expensive, so he started there.
The initial goal was to get 100 clicks. He tracked the average time spent on the page and set up Conversion Tracking to see how many of those 100 users convert, i.e. leave their email.
Entrepreneurs do this ALL the time. With about a 50$ investment, anyone can run an initial market test and get immediate feedback. Playing with paid advertising might seem daunting, but Google and Facebook have gone to great lengths to keep it simple. Especially if you’re only using two or three of its most basic features.
If you already know where your target audience gathers, feel free to go even more lean. Engaging directly with a community is a powerful way of collecting quality insight, when and if you can get away with it.
Sometimes, all you need to do to is ask. A fellow redditor recently created a website that complements Twitch, a massively popular video-game streaming service, and asked a relevant subreddit for feedback. Most of the 200 comments came within the first 48 hours of him starting a thread.
People shared their thoughts, proposed tweaks and even offered small strategic partnerships. Obviously, this shouldn’t be the be-all and end-all of his market analysis, but it sure looks like a good start. The cost? Virtually nothing.
It seems like most aspiring entrepreneurs delay acting on an idea until all of the stars aligned. I’m no astronomy major, but it seems like that rarely, if ever, actually ends up happening. And even when it does, feeling the initial market pulse shouldn’t require expending massive resources and creating a comprehensive overview of the playing field.
Think big. Start small. Don’t mistaken your mom for a market analyst.