Idea validation can be expensive and cumbersome if you don't have a process to follow.
When considering a new idea or product to validate it’s important to decide whether the idea or product will work. It can be difficult and costly completing product validation an idea if you don’t have a plan or haven’t done idea validation before. We’ve assembled some reasons why you want to validate an idea or product before you launch.
Business Failure Stats:
- 42% of ideas fail due to the lack of demand for the product or idea
- The success rate based on how many companies you’ve started:
- 18% success rate for entrepreneurs
- 20% success rate for second-time entrepreneurs
- 30% success rate for venture-funded companies with a founder with an exit
If reading these stats makes you worried about validating your idea, don’t be. We’ve had experience in idea validation and customer research for over 10 years. We’ve put together some easy steps to help you below. With the proper validation process, you’ll be able to determine whether or not to pursue an idea.
Idea or Product Validation Steps:
- Research the Idea (Day 1 to 2)
- Research the competition and other similar products in the market
- If there’s competition it isn’t necessarily a bad thing. If the customers aren’t being served correctly there’s an opportunity.
- Research the cost to start the idea or build the product
- If you’re going to start something you want to make sure you can presell to potential customers or if you can find a way to build the MVP for cheap it’s important.
- Research the market to see if the market size is big enough
- Review the market size to see how big it is. Using a source like IBIS world, statista or market watch can help you determine the market size.
- Get Feedback (Day 3 to 6)
- Feedback from potential customers
- Doing customer research is one of the most important steps to gather feedback for product validation. You can use Linkedin, Facebook, Instagram or your own contacts to research potential customers to test with.
- List out questions you think customers would have about the product, descriptions about the product and what you would charge to ask if they would pay for it. Using questions for customer research allows you to learn directly from your potential or existing customers.
- Feedback from current customers (if product/idea is already in the market)
- If your idea or product is already in the market you can use your current customer list to validate the need for the new feature, idea or product.
- List out questions about the product, descriptions about the product, what you would charge to ask if they would pay.
- Pivot or Pursue (Day 7)
- If you find there’s interest, a large market and you want to move forward. Pursue it.
- If you find that users aren’t interested, there’s no market and you believe this isn’t an idea to pursue. Pivot away.
At Vault we have the Learn, Build and Grow model that helps companies of any size from startups to Fortune 500 do product validation using proven tactics from our years of experience. Want some assistance or have questions about how to validate your idea? Reach out to firstname.lastname@example.org to schedule a free call and email us to get your free Idea Validation worksheet.