8 Questions to Ask to Validate Your Product or Business Idea
When inspiration strikes, it doesn’t always strike gold. Ideas for a product or business should be proven worthy before spending loads of time and money putting plans into motion. Here are eight simple questions you can ask to validate your product or business idea.
1. What problem are you solving?
If you can’t quickly and clearly describe the problem that your product or service solves, then you probably need to go back to the drawing board or further develop your idea.
2. Have others tried to solve this problem? How did they succeed or fail?
History is a great teacher. Study those who have attempted to solve this problem before you and figure out why they succeeded or failed in their mission.
3. Can you clearly state the key features of your product or service?
If you can’t clearly describe the key features of your product, you haven’t given it enough thought. You should be able to do this easily before moving forward with an idea.
4. What sets your product or service apart?
Try to think of all the things that make your product or service different. List as many things as possible. If you’re merely offering something that’s already out there without a fresh spin, why would anyone choose your product or service over a competing product or service?
5. Who are your competitors?
This one goes hand-in-hand with #4. If you have no competitors, that could be the sign of an untapped market. If you have competitors, that could be the sign of a healthy market, but one that may be tough for a startup to break into. Study your potential competitors, make a list of their strengths and weaknesses, and figure out where you would fit in.
6. Who is your ideal customer?
Be specific. Start with a general demographic, but then focus, refine, and zero in on the exact persona that your product or service will be targeting.
7. How big is the market for your product or service?
If you discovered in #5 that you have no competitors, you better hope that’s the sign of an untapped market. Because the alternative is that the market is so small that no product or service within the market stands a chance of making any money. You must have a rough idea of how many people want or need your idea — and what they would pay for it.
8. Have you done a SWOT analysis?
A SWOT analysis can help you determine the strengths, weaknesses, opportunities, and threats involved in a potential business venture. It’s recommended that you perform a SWOT analysis early on in the process, as it will show you whether or not your objective is attainable and help you focus and refine your approach to completing that objective. The SWOT, however, may not work for every company or project (in some cases even hampering performance), so alternatives to try are the growth-share matrix and the Porter five forces analysis.
READ MORE FROM AMERICAN COMMERCIAL CAPITAL
In this week’s roundup of great videos for entrepreneurs and business owners, Brian Tracy shares 10 tips for increasing your profits and sales, Flower Flash NYC founder Lewis Miller details his journey as an entrepreneur, and CNBC explores the rise and fall of one of the most successful clothing brands of the 2000s—American Apparel. Plus, Evan Carmichael has put together the top 10 rules for success from the 2020…
In our latest business video roundup, Patrick Bet-David goes over 10 situations every entrepreneur will face, Method co-founder Adam Lowry extolls the power of perseverance, and CNBC explores Wendy’s recent play to steal some market share from Burger King and McDonald’s. Plus, Marie Forleo and Brian Tracy each have illuminating videos with simple, research-based tactics to help you achieve your goals. Even if you’ve already failed your New Year’s resolutions,…
To get the year started off on the right foot, here’s another roundup of great videos for entrepreneurs and business owners of all stripes. Gary Vaynerchuk discusses the number one reason why you might need to fire your number one employee, Patrick Bet-David reveals some conversations you should have with your parents as an entrepreneur, and Brian Tracy advises on how to develop a clear vision for the year ahead.…