So #GenerasiPenemu, you already have a startup. You have your product, and you are ready to market it. With your business idea, how sure you are with the success of your business? How sure you are that people are going to use your product or service? To reassure yourself, you need to do market validation.
What is market validation? Shortly, market validation is a research process of the people from your targeted customer, to understand how attracted they are towards your product or service, and to know the potential of them to use your product or service. This aspect is surely related to the potential benefit of your business. Market validation is important to do because it could avoid big project failures, and also ensure the needed cost for the product development.
Market validation needs to be conducted early in the process so you and your team will not waste time creating business ideas. It will be very unfortunate if you and your team have created business ideas but the product or service is not aligned with the targeted customer. By doing market validation, you can understand how the product or service of your business can fulfill people’s needs. Besides, you can also know your users’ pain points of your product or service from their points of view.
After understanding the definition and function of market validation, you definitely want to know how to do market validation, right? To help you with it, here are the steps of doing market validation.
1. List down your business hypothesis
Hypothesis here means assumptions related to users of the product or service from your business. By writing the assumptions you want to test, you could see the value of your product or service.
Some examples that you could see as the reference are:
- Who is the targeted customer of this business?
- What is the value of this business?
- What are the differences between your product or service and others’?
- What kind of product or service could solve the problems in the community?
- What are the business model and pricing concepts of your product or service?
2. Estimate the market share or targeted customer
Before conducting the test related to your business ideas, first, you need to ensure the size of market share from your targeted customer of your business and estimate the percentage of your targeted customer with the potential to use your product or service.
After gaining an idea of the size of your market share and targeted customer, you need to choose which assumptions you want to test in public, which of course are in accordance with the products or services of your business. The assumptions that you and your team choose will be related to the research method that you will choose to conduct the test.
3. Find and gather the research participants
One of the most important steps in doing market validation is the research participants. You need to choose the participants carefully because it is directly related to the result of the test. By getting the right and in accordance participants with the targeted customer, you and your team will get real results.
You can gather research participants from your friends, acquaintances, family, social media, or even from existing users of your product or service if any. Before doing real research, it never hurts to try to experiment first on the test.
4. Conducting test
The real research and test are ready to be conducted when you reach this stage. The characteristics of your readiness to carry the market validation are when you know which hypothesis or assumption you want to test, when you have chosen the research method, and when you already gathered research participants.
The test of your product or service from your business could be done in two ways, and they are:
- Alpha testing, which means you conduct the test with internal employees as the participants. By doing alpha testing, you can prepare the product or service better to be tested on real users of your business product or service.
- Beta testing, which means you conduct the test with real users as the participants. This test is needed to know the specific problems experienced by users when they use your product or service from your business.
5. Review the test result
After the test is successfully carried out and you get the results of the research, try to review the results. Getting a bad response or input does not mean your business has failed. A poor response from the community means that there is something that needs to be improved from your business. Think of it as a success on the research you did, and make improvements to the product or service of your business. Remember to always listen to and receive input from customers in accordance with your business vision and mission.
#GenerasiPenemu, do not you think that the steps above to do market validation are challenging yet seem fun to be done? Besides in Ideanation’s website, the needed knowledge about market validation to develop a successful startup can also be gained from the professionals in Ideanation team. Let’s join Ideanation Annual Competition to win the prize of billions of rupiah for funding your startup and be mentored by professionals. What are you waiting for? Come join Ideanation Competition and make #IdeDariKamu become a dream come true!