Every now and then, we tend to come up with ideas, we’re convinced will; a) change the world b) make us millionaires and c) make us famous. The truth is, while these ideas might have potential, sizing up the market and its potential will help determine if your idea stands a fighting chance for consumers to part with their hard-earned cash.
Before you go crazy and start building a product, remember you need the buy in of your target market to make it a success. Luckily, here’s a quick set of questions for you to answer to determine whether there is a market for your product.
Do your target customers have a need for the product?
Lets face it, if there isn’t a need for what you’re offering, your product will have a hard time making money for you.
Start by talking with your target market and asking them for feedback. You’ll get a better idea of what they need, when you get out of the building and start engaging. Better yet, have a prototype ready if you can.
The best part of answering this question, is you can test the idea out without spending too much money.
Do they have the purchasing power to buy the product?
Here’s where the financial side of things come into play. If, from the previous question, you’ve established that there is a need for your product. The next step is to look into how much the product will cost, what price you’ll be able to flog it out for and whether your target customers will be able to afford it.
Pay close attention to the margins you’ll be receiving, as you’ll want to be making a healthy return on each product sold.
Are there enough potential buyers for your product?
Obviously you wouldn’t be satisfied if you’re able to sell your product to only a handful of customers. But then again, you wouldn’t be studying the market and reading this, if you weren’t serious about going big.
Look at the numbers of the customers you’ll be aiming to sell to. Don’t go in with the attitude that you only need to sell 1% of the market and that’s it. It hardly ever works that way, and why settle for 1% to begin with!
Will they buy the product?
Arguably this is the most important question you need to answer on the list. If your product doesn’t sell, you don’t have a business on your hands.
Test out your product as soon as you can, and use the feedback to improve and tailor it to the needs of your target market. You might also want to look out for the pitfall that come with asking for feedback by reading, why you should think before asking customers for feedback?
Another approach you can try is to set up a pre-order page and see how many people sign up. You can also test product names with Google AdWords to see which ones yield the best results.
A lot of technology companies produce and release successful products because they know their customers and markets well. Develop a habit of engaging your target market and becoming an expert in your field, that’ll enable you to start spotting trends and opportunities to take advantage of. Customers don’t always know what they want, therefore it’s up to you to start developing products that really matter.
Take your first steps with your innovative product by answering the questions above, to determine whether you’ve got a market to cater to with your product.