Before investing too much time and money into a product idea, you should do your research and put your idea to the test to save yourself future heartache and financial loss.
Thousands of new products are launched every month, but only a handful of them will go on to be successful.
Here are a few questions to ask yourself to work out whether your product idea is worth developing and pursuing, before you get in too deep.
Does my product solve a problem or fill a gap in the market?
To have longevity, a product should do more than jump on a bandwagon or appeal to a current trend in the market. The most successful and profitable product ideas help to solve a problem or fill a gaping hole in the market in order to change people’s lives for the better.
Ask yourself, “what problem your product idea is solving”. This insight and strategy will lead you to conduct market research by interviewing potential customers to find out more about the problem.
This can help you to discover:
- Whether the problem is real.
- Whether people would be prepared to pay money to solve it.
- What people are currently doing to try to overcome the problem.
- Whether your product idea would successfully solve the problem.
What is my minimum viable product?
To begin establishing whether you have a viable product idea you will need to first identify the key features of your minimum viable product. This establishes the core functionality of your product idea and the problem it sets out to solve, without any additional bells and whistles.
Your minimum viable product is the version of your product that you will test in front of your audience. From this, you can develop or adapt your idea as necessary.
Is there enough demand?
Once you’ve established that there is indeed a problem and you have a minimum viable product to solve this problem, it’s time to find out if enough people would be interested in your product. This calls for more market research.
Interview your target audience again, this time presenting them with your minimum viable product and collect feedback on whether they believe the product would solve the problem and if they would buy it.
You could also benefit from marketing your product idea online as “coming soon” to see how much interest it attracts. Create a website landing page and/or social media profiles and ask people interested to opt-in for more information.
Is my product idea profitable?
Before investing big, make sure that you’ve researched your costs and profit projections thoroughly, you should know your figures inside out.
It’s very important to understand how you’re going to acquire customers, and how much each customer will cost to acquire.
Remember, for your product to be profitable, a customer’s lifetime value needs to be significantly more than the amount it will cost you to acquire their business.