Introduction
If the world were a perfect place, we could be sure that any product could sell to anybody at any given point in time.
However, human dynamics, psychology, tastes and preferences, and the differences that make us humans do not make the consumer market a perfect one.
Idea validation then becomes a necessity for businesses who want to put their ideas in the faces of the right consumers.
A Story… Company A as a Case Study
Company A has this idea of delivering light bulbs to a village. This village has been in darkness for centuries and light bulbs might be the biggest and brightest invention to visit the village.
“Light bulbs have been received well by the city dwellers. Since most city people visit the village during festivals, they might be excited at the sight of a light bulb similar to that in the city,” they thought
Company A also thinks that if they get to be the first company to get this product to the village, they might have a first-mover advantage and even expand to other nearby villages, therefore increasing their market share within the next 12 months.
All of these were great insights based on imaginations and it felt so good to do this as soon as possible.
Within 2 weeks, Company A had set up a light bulb store at the entry to the village. This was a strategic location because they would be able to capture everyone going in and out of the village and sell in large quantities.
Company A also had plans to introduce coloured lights later on but that’s after the successful launch of this initial product.
It was devastating when Company A couldn’t sell a single light bulb because the village people were poor and couldn’t afford the light bulb. They loved the idea but there is no electricity in the village that could have powered the light bulbs.
They also loved their fire camps which they set up every night. They thought it shined brighter than the light bulbs and didn’t cost a dime for them to ignite it at night.
They obviously didn’t need the light bulb – maybe not at this time.
Sadly, the light bulb project became a complete failure in the village. Company A had wasted time, money, and resources fantasizing about how wonderful the village light bulb project would be. It was a failed idea from the start and eventually, it became a failed project.
What is Market Research and Idea Validation?
“Everything starts and ends with the product. We can do as great sales and marketing as we want, but if we don’t get the product right, we’ll fail.”
— Malte Scholz, Head of Product and CEO at airfocus
Investopedia claims that market research began formally in Germany around the 1920s and for the United States, it cropped up during the Golden Age of Radio.
According to Encyclopedia Britannica, the Golden Age of American radio spans from 1930 through the 1940s.
The radio served as a very great means to target customers in both rural and urban areas and other demographics that used the radio as a source of truth.
This means that market research has been around for more than a century.
Idea validation is just as its name implies. It is confirming that an idea will be acceptable to potential consumers or a target audience. It also shows that this group of people will be willing to pay for the idea after it has been fully developed.
Market research, on the hand, is the process of achieving this confirmation (idea validation) through research. Market research is a system for gathering the opinions and feedback of a target market for further evaluation.
If market research is done properly, it can determine if an idea should be worked on or if it should be discarded. A pivot could also be an option where the idea is not completely discarded but adjusted to suit the needs and demands of the market.
The Different Stages of Product Development
Zapier defines seven (7) keys stages in product development:
- Ideation
- Validation
- Prototyping
- Marketing
- Development
- Launch
- Improvement
The ideation stage is the first stage. This is the stage where you brainstorm, generate and record all the possible problems, solutions and opportunities.
The validation stage is where you conduct research using all available data at your disposal including competitor analysis. It is also at this stage that you get talking with potential users of your products to gauge their interest and the things that matter to them.
The prototyping stage is where you create a prototype, a sample, a mockup or simulate the real product. This prototype allows you to present something that users can use in the meantime and give feedback on what to improve on for the real product.
The marketing stage is where you decide how you will get more buy-in for your prototype. In this stage, you’re reaching your targets with a value proposition that solves their pains and evaluating their reaction and receptiveness to your offer.
The development stage is where you gather every available data from your validation stage, prototyping stage, and marketing stage to develop a minimum viable product (MVP). This is a better and an improved version of your prototype but not the full picture of the solution. That’s because there’s never a final product, you will continue to reiterate and develop this idea to suit customer needs from time to time.
The launch stage is where you release the MVP to the market and let the world know what you’ve been cooking and developing to solve the problems you’ve identified. You should have ran some tests in-house and with a small number of users before making this final launch.
The improvement stage is where the Japanese word, ‘Kaizen’ comes into play. It means ‘constant and never-ending improvement’. This buttresses the point earlier made about improving your product. Use data and customer feedback. Change is inevitable, be open to make changes and create new features. You should also be flexible to make a complete overhaul if the market calls for that.
Why Market Research and Idea Validation is Important Before Product Development
Looking back at the story of company A at the top of this article, we can identify a few importance of research before product development.
Has Company A conducted some research before going to market the light bulbs, they would have been able to do the following:
- Reduce business risk by understanding that electricity is a key ingredient for the light bulbs to function. They could have focused on ensuring that the village received electricity.
- A new business could have been centered around this. If they decided to go this route, they could have identified the potential risks of fire camps in the neighborhood while helping the villagers realize the many potentials for electricity.
- They could even tell the villagers that they can maintain their fire camps for some sacred purposes but electricity can be the main form of energy. This could have opened up other potential businesses for the business instead of being short-sighted with the light bulbs.
- Company A was making lots of assumptions that were untested. If research has been done, they could have tested their hypotheses and assumptions as they identify those that were true and those that were wrong. For example, the company assumed that the village had only one entry. With this, they focused all their marketing efforts on this one entry.
- Had they tested their assumptions or spoken with a few people in the village, they would have found that the village had another gate behind the village that was just a distance away to a small village with some civilization far better than the village they were targeting.
- They could have been able to change their focus and channel their energies to serve this other village in the short term while they figured out other similar villages for new business.
Clearly, we can see that Company A’s lack of research opened them to business risk, their marketing became flawed, they failed to identify new potential opportunities and they launched the wrong product to a target market that was disinterested in what they had to offer and the solution they thought they had. The problem identified was also flawed.
All these could have been avoided with some good research during the idea validation.
Conclusion
If you have an idea you would like to develop and take to the market, it is always best practice to introduce market research and validate your idea before expending all resources to an idea the market isn’t willing to pay for.
Market research and idea validation is an overwhelming process. If you’re a solo entrepreneur, you might lack a team to help you conduct this research at the beginning.
At Exquis Apps, we have a dedicated team that helps you convert your ideas to reliable, scalable and resilient products and services that the market wants.
We would conduct research with all the available tools for this purpose and provide data and insights to help you with informed judgments about the viability of your ideas.
Thereafter, we help you to develop and test prototypes, MVPs and products that can be launched to the mainstream market.
Contact us today to share details about your idea.
