To be called a firm with a verified business model, a startup does not require thousands of users. There are countless startup stories where tens of thousands of people were attracted but no business model was found and validated. For several newbies with creative thinking and innovative startup ideas, the process is both interesting and challenging.
Having validation and a check of what are you proposing as a service or a product in the world is inevitable. The validation methodology assists both entrepreneurs and product managers in launching better products with a higher possibility of market success. Idea validation/ Market validation is the very first step in the process of evaluating whether there is a challenge worth addressing with a solution clearly influenced and agreed upon by future users. This phase comes before making a substantial incentive to invest in product development.
What exactly is market validation?
It’s a common question amongst novice entrepreneurs and product managers. Market validation is the process of establishing whether or not your product is appealing to a certain target market. This involves doing a series of consumer interviews with people in your target market, and it usually occurs prior to making a large product/concept.
Preparing a strategy for reducing risks, costs, and uncertainty while increasing future success rates leads any startup towards success. Follow these steps to develop a successful startup idea and validate it.
· Find an issue that is large enough to warrant a solution.
The greatest place to begin is with your own concerns and wants. Important problems address pressing requirements. Many entrepreneurs enjoy referring to the X for Y ideation game. Begin with the problem and let the client and testing inform you which model would best address it.
Luke Kervin highlighted his experience in developing and validating the idea of PatientPop, a platform he co-founded allowing physicians to improve every stage of their patients’ journey, during a Startup Circle live session. When Kervin’s wife became pregnant in 2013, he was astounded to find at the OB/GYN office that the healthcare business was trailing far behind the rest of the world in embracing contemporary technologies to manage procedures. But he converted a bad personal experience into a fantastic business idea, which eventually became PatientPop.
It is tempting to believe that you have a thorough grasp of the problem and the best solution for the consumer. Validating a startup idea with a viable offer isn’t a cakewalk. It requires customer research and knowledge, and even sales.
The first step is to conduct interviews to better understand the situation. It entails asking open-ended questions with the goal of finding consistency and a pattern in respondents’ responses to the issue they encounter in a certain place.
Fix the problem by measuring the buyer’s negative effects. It might be an increase in expenses or time, a drop in productivity, an inability to achieve a goal due to an increase or decrease in an essential metric, or the absence of a solution that is causing an important measure to rise or fall.
You need data to determine those statistics, and only after speaking with a broad sample of people will you have enough data to draw reasonable judgments. You may have a clear path after 5 sessions, but it is recommended to go for 50 not because fewer will not be sufficient to acquire the necessary information, but rather because you will need a bigger audience to sell the ultimate offer to.
· Create a preliminary product
Most startups’ MVP is often their idea transformed into a product. This too isn’t an easy process, it requires both time and money. The initial step of producing the first usable (and sellable) version of your new company concept is referred to as the MVP. This will give you an insight into user interest, use statistics, and feedback. Using a minimum viable product (MVP) to connect with users and consumers early in the development process is part of verifying the need for your product.
According to a news article by Financial Times, only 50.3% of London startups survive their first three years, with the majority of failures due to poor financial management and a lack of business expertise. An MVP may serve as confirmation of your initial product concept and serves as a functional model of what you intend to build. It might serve as the centerpiece of a powerful pitch to potential investors for the ultimate funding of the startup.
The MVP phase is an effective strategy to move your business forward in terms of creating a product that people will want to use and pay for, as well as earning your first income. So, if you’re an entrepreneur with a fresh revolutionary product/service concept, it’s critical to design and develop your MVP phase as soon as feasible.
· Market the concept
Following the planning of your MVP, you must advertise the notion. Selling early on, even before the first version of a product is created, is a good approach to validate the need for a concept and generate a pool of believers who will help you launch a product that meets their demands.
This step can even be termed a Minimum Marketable Product(MMP) or Minimum Marketable release (MMR). It’s the final version of your MVP that can be delivered to the market. Throughout the process of collecting customer reaction data, the product changes to become an offering based on the user’s latent requirements. As a result, it is the first genuine step toward the finished product.
This phase usually shortens the time it takes to get an idea/product to market. It allows critical consumer input that leads to product improvement.
· Concentrate on the essentials.
Considering the essential features of the idea comes next, which can be abbreviated as MMF (Minimum Marketable Feature). This comes after the creation and feedback loop have been played several times. That element of the MMP or the MMR clarifies the product’s purpose. This is the one characteristic that serves as the product’s basis. For example, in the case of a food-on-demand app, you may begin by enabling users to explore restaurants and menu items while you collect orders over the phone and be paid in cash or by Square at the door after delivery. This is how the food-on-demand service DoorDash got its start.
Emphasizing the crucial features of the idea, feedback collected, and meeting the discrepancies helps to increase brand recognition among consumers. It will lead to revenue creation as a result of its ability to be launched separately. This will provide a competitive advantage versus similar market offerings
· Endmost offering
The ultimate step of completion is the Minimum Loveable Product. This final derivative will be the startup’s ultimate offering in the form of a product generated through informed learning. The path of each step is defined by fast, precise, and actionable insights gained from user input data collecting. This reduces the likelihood of failure by minimizing disparities that may result from hunch-based, instinctive decision-making.
When the most important elements of a product are upgraded for quality, MLP is formed. Whereas MVP and MMP offer minimal capabilities, an MLP is designed to be enjoyed. The goal is to make the user like the product rather than merely its basic functionality. This way after all these phases your idea stands market validated.
It’s in the essence of all startups to be risky. When attempting to produce and promote a really new product, numerous assumptions are made – both about the product concept and the desires and requirements of the people for whom it is being built. Incorporating the above-mentioned steps from developing an idea to getting a minimum lovable product is frequently the most efficient and evidence-based method of testing and validating your startup ideas.