The essential steps to know if your product works

Do you have a business and you don’t get a sale?, do you have and idea and you want to know if it works? These are lot of questions that entrepreneurs do when they want to launch or enhance their business.

In most of the situations, they have a hypothesis. For example, in the situation of Groupon, who sell promotions and discounts of company services and products, their customers really want to buy coupons?

In most of the situations, they have a hypothesis. For example, in the situation of Groupon, who sell promotions and discounts of company services and products, their customers really want to buy coupons?

The first step is to know your customers and know if it exists a need for their part. For this you can make a first validation, it means to know if your customers would buy a coupon. In the situation of Groupon was easy, they look for the nearest pizza joint, they print some coupons and distribute them in the neighborhood. It was a complete success. This validation test is known as “minimal viable product”, they demonstrate that offering promotions to customer can work. The minimum viable product in this case was easy and fast to validate.

There are another minimum viable products samples. For example, Dropbox wanted to demonstrate that share files in internet has beneficts. He tested a video and there was thousand of registers to test Dropbox. Other validation options: a website where you tell you customers your service and a form where you can register. If there is some attention, you can bring your service to a next stage.

What we do if it doesn’t work? Test other things, that is a “pivot”. We have to be able to validate with the minimum resources and test if it works very fast.

So here five keys to validate your hypothesis:

Know if there is a real need. For example, the Groupon users want access to promotions and disccounts to buy cheaper, and the companies need to increase their sales.

Validate too quickly your hypothesis with a reduced group solving a need behind a minimum viable product. Dropbox created a video to demonstrate if it was a need to share files in internet. This lets to advance and go to the next stage, in this case: develop the product you showed with a demo in Internet with all these features.

Learn doing. Probably you are going to mistake. For example, Dropbox decided to make Adwords campaigns to promote their product and it was very expensive. With this situation they learned that it was a wrong channel.

Ask your customers. In the situation of Dropbox this lets to growth. Somebody reads about Dropbox, a friend, someone.. decide to try, he install it, it likes the experience and he recommends it. Thanks to this process they have growth and they have millions of users.

Repeat all the process in a next or advanced stage. Coming back to the Dropbox example, the video lets to demonstrate a prototype of their product but they have to evolve and show a first product version to the users registered with the video.

Repite todo el proceso en una fase más avanzada. Volviendo al ejemplo de Dropbox, el video les permitió mostrar un primer producto pero tenían que evolucionar y mostrar una primera versión del producto a los usuarios que se han subscrito.

These tips can help you to know if the product and service that you offer it works. Lot of times you don’t stop to think if the service that you offer is going to be accepted by your customers. You need to test your hypothesis that you have created in your own brain to reduce your efforts and time. When you demonstrate that is a valid option, you can enhance this product idea.

If you look again the Dropbox example, develop this kind of product is quite complex and you can get the time and money to develop something that your customers doesn’t want. This is often the main reason your business fail.

And in your situation what was your minimal viable product?

comments powered by Disqus