S7 E50 Do not waste time building a product no one wants. How ensure you will find paying customers with Jeremy Gray

The CB Insights tech market intelligence platform analysed why 110 Tech Companies failed. The leading cause of failure was that they ran out of money.

The second most common cause of failure was that there was no demand for the product or service.

How can you avoid spending hours and money developing your business only to find that no one, or at least not enough people, wants your product or service?

To test and validate your business idea ask three questions:

What problem do my potential customers have?

What is the solution to that problem?

Why should people pay money for my product?

Behind these questions are further questions. Who are my potential customers? Will my solution appeal to my potential customers? How much are my potential customers willing to pay?

Are people searching for a solution that matches your product offering?

People searching for solutions often use Google. Make a list of the terms you think people will use when searching for a solution for the problem you are trying to solve.

Use Google’s Keyword planner or Moz’s Keyword Planner to find out how many people search for specific words or phrases.

It is to be hoped that many people are already searching for your solution. If not; then maybe it’s back to the drawing board.

Identify potential competitors using the same key words. Analyse their value proposition. Can you do better? Can you see a gap in the market?

Is room in the marketplace for a new entrant?

Explore the internet Join appropriate forums where your potential customers may be found. Ask about their problems and current solutions related to your business idea. Are people suggesting work around solutions?

Develop your minimum viable product. A MVP is the first working version of a product, with just enough features to satisfy potential clients and collect & analyse their feedback for the next product version, with minimum effort and resources required. The next, complete product version is developed after elaborating on the initial user feedback.

A minimum viable product is not an MVP until it sells. Consider a virtual MVP.

Build a landing page – test advertising to direct traffic to your site. Include a price and a buy now button. This does not go to check out but to a page that explains the situation and suggests the view leaves an e-mail address

Validates that people are willing to part with their cash to acquire your product.

No money to build an MVP or pay for advertising? Consider content marketing. Write a blog with content that your target market might find interesting. Using the knowledge of learned about where your customers hang out – post messages etc directing folks to your blog. There is no substitute for research. It can be frustrating when you just want to get up and running.

But more haste less speed. The steps covered in this series Is there a demand for my product can help you avoid the second leading cause of failure for start-ups; No one wants your product.