The first, and one of the most crucial, steps in any business start up is determining if your business idea is viable and can be built into a successful company. This is not as easy as it sounds. You will need to look past your own assumptions and judgment and find the real truth in today’s marketplace.
Large corporations use expensive focus groups or massive surveys. While both of these methods can uncover vital marketing information they have inherent faults such as low response rates and focus group participants giving you incorrect answers.
Read on to learn how you, a bootstrap entrepreneur, can get real-world data and product feedback on your new business idea, to validate your concept and confirm your business model.
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Boots on The Ground
Good old-fashioned pounding the pavement can still be your best and cheapest form of data collection about your business ideas. Going out and visiting your potential customers, where they are, whether it be coffee shops, small businesses or sports fields can be a gold mine for vetting your business ideas.
Don’t do it just once, with one group of people or one location – you need to spend at least 20 hours of one-on-one discussion with target customers to get a true picture of your market and how your new product would fit in – or not.
While you may assume, incorrectly, that customers will pay for your consulting services you may find that they actually value your instructional videos more and will pay handsomely for access. Knowing this will radically change, and improve your business model for your eventual success.
Incubate Your Hatchling
Treat your new business idea as a precious egg that needs the proper environment and nurturing to hatch into a thriving company. Use your local business incubator programs, and accelerators also, to help you assess your business concepts and help you launch your startup.
Most cities in the US have one that is associated with the small business administration SBA. Often they are associated with universities. Generally there is no, or low, fees for these valuable entrepreneurial programs.
Promoting entrepreneurship in the region is the mission of these groups, which are composed of successful entrepreneurs and other beginning startups.
Find your regional SBA office here
You don’t have to go the entrepreneurship route alone. There are mentors who can, and want, to help you succeed.
Start with your local chapter of SCORE, Service Corps of Retired Executives, to find experienced business owners who can share their honest feedback about your business idea. The invaluable services of these men and women are free. Take advantage of this well of golden knowledge.
The aging baby boomer generation is full of smart, professionals who want to counsel beginning entrepreneurs to see them succeed.
Phone a Friend
Use your business contacts, whether they be in the exact industry of your business idea or not, to get their honest opinions and suggestions on your startups business model.
Don’t go to friends who will simply encourage you, and perhaps not be entirely honest.
Instead contact those people you know have the courage and respect for your time and business to be honest but kind.
People are often flattered when you ask they are educated opinion about your business idea. Thus they will go out of their way to help you succeed.
Run It up The Flagpole
Test your product and see if customers buy it.
Here are a few ways to do this:
Beta Testers – invite people to test unfinished versions of your product to get their input. You will learn what features they value and if they would spend their hard-earned money to purchase your product idea.
Use a site such as Product Hunt to introduce your tech product to the market place https://www.producthunt.com/
Landing Pages – post a webpage about your new service and run Google ads and measure the click through rate. This test will determine the interest level of the current market for your product.
Just Ask Me
Ask people, who are in both in your target customer group and are mentors, these type of questions:
- Would You Pay for This Product or Service? How Much?
- Why would you buy it? What is your reason to buy?
- What need or want does it satisfy?
- What other services do you buy now that are meeting this need/want?
- What would you do to improve this product?
Check out my guide on how to start your business right with tons of useful tips I learned by successfully starting, building, and selling multiple companies.