Find Product-Market Fit Faster

De-risk your New Product or Service Innovation

Eureka! You’re an innovator, and now you’ve got a fantastic new product or service that you think will solve a real problem for people, and you’re excited to get it out there into the world. But how do you know if there’s a market for it? How do you figure out if people actually want what you’re selling? How do you reduce the risk of burning resources on building solutions nobody wants?

This is where determining product-market fit faster is so valuable. Product-market fit is the holy grail of entrepreneurship  – the sweet spot where your product satisfies the needs of your target market, perfectly solving a problem at your set price.

To expedite product-market fit, you must do crucial discovery, analysis and strategy work up-front – before you go too far into your product investment.

First, you need a firm comprehension of your specific target market and its critical needs.

Second, you must understand your competitors and the opportunity white space in the market; and

Third, you need to effectively position your product to succeed.

Let’s dive into each of these steps in more detail.

You must do crucial discovery, analysis and strategy work up-front –
before you go too far into your product investment.

Understand Your Target Market

A critical first step in achieving product-market fit is understanding your target market and its needs. You can’t just assume that everyone will love your product, so you need to be very specific about who you’re targeting. The more niche your audience is – the more effective your early product and marketing efforts will be. Clearly defining your market simplifies messaging and tailoring products to meet buyer needs.

The ideal early way to do customer research is to conduct interviews with your targeted ideal buyers. You can do this in person or through an online video call. The key is to ask open-ended questions that allow the customer to explain their workflow pain points and the impact in their own words.

Get detailed answers citing specific examples, impacts, and expectations. You will also want to understand how they are solving the problem today, ask about their solution buying habits, and how they make purchasing decisions.

The best tool for understanding is talking directly with the target user.

Target customer discovery interviews can last 15 to 30 minutes. Be respectful of people’s time to maximize their willingness to participate. Go into each interview prepared with a list of 3 key questions to ask, plus one-to-three other questions if time allows. Make sure the target buyer does most of the talking.

You are there to discover their critical problems, how they deal with them now, the impact, and what they might pay to solve these issues. Don’t be pitching your product or looking for compliments.

Your job is to learn from these conversations and continue to refine your unique solution.

Survey response is highest when you have an engaged target user base.

Another tool for understanding your target buyer is to do customer research using surveys. Note: Depending on the client, I sometimes like to start with the survey as a first step and then include a question soliciting participants for the one-on-one interviews. Surveys can be delivered by email (if you have access to an emailable database) or through a pop-up or landing page on your website.

Survey response is highest when you have an engaged target user base, particularly if they’re struggling to find a suitable solution for a critical problem. Use survey builder tools like SurveyMonkey, Google Forms, or Form Builder to ask specific questions about your product and your target market.

Keep surveys short, and ensure the questions are easy to understand. You may want to offer incentives for completing the survey, such as a discount code, a small gift, or a chance to win a prize.

A couple of other simple methods for gauging general interest in the concept include measuring clicks on teaser ads promoting the solution before it exists. Or by creating landing pages offering beta access registration. Still, the best tool for understanding is talking directly with the target user.

Know the Competition

After understanding your target market, conduct competitor research to analyze similar solutions and their market positioning. This will help you identify the market white space – the spot where your product stands out and fills a gap that others don’t address.

Start by making a list of your primary competitors. Leverage existing data, plus use Google to search for similar products or get lists of alternate solutions from your target customer surveys and interviews.

Once you have a short list of competitors, start analyzing their products and messaging. Understand their positioning, value proposition, and key strengths. Look for areas where these products fall short or are not addressing a particular need that your product can fill.

You might also want to look at customer reviews and product/service review websites. What are customers saying about these products? Are there any common complaints or issues you could address with your product? Use this information to refine your messaging and ensure your product is positioned to meet the needs of your target market.

Competitor Analysis Checklist

1. Identify your competitors.
   • Make a list of businesses that offer similar products or services to yours. Which competitors regularly are mentioned by your prospects, customers, and media? You can use online directories, search engines, or industry associations to find competitors in your niche.
2. Analyze their website and social media presence.
   • Once you’ve identified your competitors, look at their website and social media presence. Pay attention to their design, content, and messaging. What’s the positioning and their unique value proposition? Analyzing these factors can give you insights into what’s working for them and what you can improve upon or do differently and better.
3. Evaluate their pricing.
   • Understanding your competitors’ pricing strategy can help you make informed decisions about your pricing. Understand their published prices and volume discounts, and, if you can, learn more about their enterprise pricing models.
4. Check out their customer reviews.
   • Customer reviews can be a great source of information about your competitors. Look for reviews on their website, social media, and third-party review sites.
5. Test the competitor’s product.
   • Sign up for free trials or purchase the product of key competitors if it’s reasonably priced. Understand the registration and purchase paths and the product’s user experience, features and benefits. What was great? What really sucked? What’s missing?
6. Write it down
   • When evaluating the above competitive elements, you must document your findings to go back and look for patterns and whitespace gaps.

Competitor research will help you identify the market white space

Product-Market Fit – Find the White Space

One of the keys to achieving product-market fit is finding the competitive white space. This is the market area where existing solutions aren’t meeting a critical need. By addressing this gap, you can create a solution that meets the needs of your target market and differentiates you from your competitors.

Using the information gathered in your customer and competitor research – identify the areas of high importance where competing solutions fall short or are absent in addressing a particular need.

Next, talk to potential customers and discover what they want in a product. Finally, use this information to narrow down your understanding of what element(s) matter most to the target buyer.

My approach to determining whitespace includes plotting my product and the competition against two critical user needs on a four-quadrant grid using a range from least to most (i.e., affordability and ease of use). Do you best solve that need? If not, try again by applying a different user need.

Some common user needs elements to compare include:

• Price
• Quality
• Features
• User Benefit
• Use/Application

Position to Compete

An essential aspect of marketing is product positioning. This concept can help you differentiate your product or service from your competitors, making it more appealing to your target audience. Be sure to read my Positioning in Four Simple Steps blog post in the News section of this website. Meanwhile, here are some basic tips on how to do product positioning:

1. Define who it’s for – Identify your target audience:
   • The first step in product positioning is identifying your target audience. Who are you trying to sell to? What are their needs, desires, and pain points?
2. What’s it for? Illuminate your product’s utility and unique features:
   • To position it effectively, you must be clear about what it’s for and what makes it special. What features does it have that your competitors don’t? How is it better?
3. Show the user what the benefits and outcomes are from your solution:
   • How is the user changed for the better by using your product or service? Quantify the impact of your solution.
4. Choose a positioning strategy:
   • You can use several positioning strategies to differentiate your product from your competitors (see an example in my Positioning blog post). Your competitive positioning strategy should emerge from the whitespace evaluation you did in the previous step when you compared competitor elements such as price, quality, features, benefits, etc.

Keep Testing

Once you have developed your positioning strategy, testing it along with the product with your target audience is essential. At this stage, invest in marketing to get more eyes on your website and get sufficient registered users to try the product.

You can then conduct additional surveys and interviews with these real-life users to get high-quality feedback on your current product, its position, and its unique value proposition. Does the product work? Are you solving their critical problem? And the essential measure is – will your target buyer pay your price for it?

Finally, continue making refinements to your product, positioning and messaging based on the feedback you receive. Apply the “build-measure-learn” feedback loop to ensure that your product or service will be a winner with your target audience.

I hope you found this article helpful. If you have any feedback or questions – let me know at don@afdonex.com.