Validate Your Business Idea

Validate Your Business Idea

 

You have a great business idea and you’re ready to launch. Before you launch full scale you may want to launch to a smaller market to see how your business is received. This will show you if you’re really solving a problem that people have.

The way you do this is by validating your idea.

Once you have an idea, validate the idea by offering your services to a sub-group within your market.

 

Set up a small-scale launch of the product or service.

  • Instead of launching the product/service nationally provide it in your local area.
  • Or instead of launching the full product or service line, start with one or two and see how it’s received.

 

The first question you ask is:

Is there proof of concept?

 

Does someone else do something similar?

Google your idea to see if someone else is already doing it:

  • If you don’t see your idea then you need to test your idea before launching full scale
    • Your idea is not already a hit for two reasons:
      • You’re a genius and no one else has thought of it
      • Other people tried and failed because:
        • There was no market or
        • The idea is too costly to execute
  • If you do find your idea don’t give up
    • Determine if you can create a niche or
    • Can improve upon the idea in some way

 

Next do the following two things

 

 Set Objectives

 

Set up your objectives

Determine what factors must be met in order to show that your idea is a business.

  • This is the minimum viable product (mvp)
    • Do you need to sell 10 or 100 products for $X?
    • Should your revenue be $10,000 or $100,000?

 

Act

Launch your product to a sub-group in your market

Market your product with a mix of PR and Advertising

  • Create buzz in two ways:
    • Using social media create a contest which will build awareness of your business and drive people to your website
      • Using your website with a landing page as a way to capture leads or create sales
    • Create a Facebook or Adwords campaign
    • Reach out to your local newspapers and pitch an article on your new business.
  • Find people who will pay for your product and ask them for their honest opinion:
    • Most people start by asking family and friends, which can be a good way to practice explaining what your product or service is.
      • A word of warning. Family and friends may not give useful information as they may not be your target customer. So take their input cautiously.
    • To get more objective opinions try a survey, like one provided through survey monkey asking people throughout your network (LinkedIn, Facebook, Twitter, etc.) their needs and interests.
    • For example: If you’re going to set up an online business to provide handyman services, place ads that offer this service and see how many people contact you.

Finally you do this

Evaluate

 Determine if you met your objectives

 

– See what your customers like and did not like and update your business strategy accordingly

– Adjust as needed and then launch your business full scale

 

Validating your idea is a useful step for many reasons.

It shows you not only if your idea is really a business but also how customers will actually use your product or service.

Pay attention to what the customers say and do and adjust your business strategy to match the customer needs.

Above everything else don’t second-guess or delay once you have evaluated.

 

Trust your gut AND your expertise to know if the idea is a business or just a creative moment that you’ve learned from.