A great product or service does not simply invite people to say “this product is great”; they remind people how great they themselves are.
Too many people think that sales fix everything. They spend a lot of money on marketing and think that PR will sell their products. But the truth is, if their product is not good, then all the storytelling will end in wasted time and money. According to David Ogilvy: “Great marketing only makes a bad product fail faster.”
To build a great company, it is important to build a great product first. But, developing a great product is not as simple as it seems. It is a hard skill. People think that they will come up with great ideas in some brainstorming sessions, write a business plan, get some investors, make a team, develop a product, and start selling it. But, the steps of developing a product and then selling can be one of the reasons for their product failure. Research by Shikhar Ghosh of Harvard Business school shows that 75% of all startups fail.
To understand the art and science of building great products, first look at some reasons why a new product fails in the market:
- Fixing a problem that does not even exist,
- Targeting the wrong market,
- Lack of marketing research,
- Developing a flawed product,
- Introducing a product at the wrong time,
- Lack of knowledge about customers’ needs and wants.
- Not living up to the hype,
- Using a weak positioning strategy.
- Using a questionable pricing strategy.
Product/Market Fit
Building a great product that satisfies the needs of the market requires extensive research and preparation. The first step in building a successful venture is the product/market fit. It is a golden rule of a start-up.
According to Marc Andreessen:
“Product/market fit means being in a good market with a product that can satisfy that market.”
When you make something that people want and they respond positively to your product, it means you have achieved your product/market fit.
Startups require a strong Product/market fit to be successful. When you develop a great product and introduce it in a great market with lots of potential customers, your market will pull the product out of start-up.
Some of the tips to achieve product/market fit are:
Understand the Customer’s Needs and Wants
Achieving product/market fit requires a better understanding of the needs and wants of the customers. Even if you provide a great product or service, but no-one will buy it if they think they do not need it. To build a product that customers need and to convince them to buy your product, you need to understand your customer’s needs and wants.
You can only provide the best services to your customers when you will know what your customers want. To understand your customer well, try to put yourself in your customer’s shoes. Look beyond your business and understand the choices of your customers. Try to understand what will you like about the product and what will you don’t like about it. Learn how your customer responds to your product. Understand who your customers are, what they do, why they need your product, and how conveniently they can get your product. You need to understand the mindset of your customers.
Target the Right Market
Once you know what will be your product and who will be your customers, you need to identify your target market. The target market is the actual group of potential customers who will buy your product or service. Entrepreneurs usually do not like to limit themselves when it comes to choosing markets. They think they will be able to sell their product in a variety of industries and markets. But, it is impossible to sell your product or service to everyone. Therefore, you need to target specific segments of your market to make the selling process easier.
To target the right market, first, you need to analyze your product or service. Determine the benefits that the user will get from using your product or service. Make the groups or segments of your potential customers. Consider factors such as age, income, gender, occupation, educational level, geographical units like nations, states or regions, generation, lifestyle, etc. After that, understand the competition that will be faced by your business in the market in which it will operate. Now, divide your potential customers into different segments, then try to target the segments that are most suitable for your product or service. For example, if your product is “Diapers for kids” and you are trying to sell it to every female, then your product is most likely to be failed. You need to make segments of your market and sell your product to mothers who actually need your product. This is how targeting works and it is the key to reaching the right customer.
Focus On a Single Value Proposition
A value proposition is basically a promise of value to be acknowledged and delivered. It is also a description of the experiences and benefits a customer will get upon purchase and use of a product.
Great products deliver value in a focused way and have a defined sense of purpose. They do better than any other products in the market. A value proposition is the most important tool to achieve the product/market fit. It is the understanding that how a product will be valued by a customer. Narrowing the features of your product to only one feature that is of great value, and that is the game changer is the basic necessity. Though it is very difficult but is most important. Focus only on that one significant feature where you provide the most value will help to get more customers because they will think that your product can solve their major problem.
In short, startups can be made successful by building great products and achieving product/market fit.
If you are planning to launch a product, start a new venture, or struggling to make your startup successful. Then don’t forget to learn more about building great products and Getting to Product/Market Fit by signing up today for my e-course.