1. Most new product development launches fail
On average around 80% of the time, a new product launch fails. When this happens, not only do companies lose money and time, people often get fired as the company is not meeting its execution targets. Perhaps there is a better way?
2. It would be great to know if a product was going to be successful BEFORE we spent time developing and launching it
Eric Ries and Steve Blank have come up with an innovation methodology, called Lean Startup. Currently, many tech startups and large corporations are using Lean Startup to accelerate their growth. It is much more effective than a traditional waterfall methodology as it’s better launching products - and incorporates the uncertainty involved in development into the process.
Lean Startup is based on a “Build-Measure-Learn” loop.
This is where you build something small, put it out into the market, measure how it does, and then come back and learn from that in order to know what to do next.
3. Use methodologies Lean Startup and Customer Development
We can take our idea from the Value Proposition Design (VPC) and Business Model Canvas (BMC) and develop it using a four-step process. The process is designed to:
4. Business Model Canvas helps you capture value
There are nine blocks to the Business Model Canvas (BMC):
5. Understand what your customer is trying to do
We start with the Right Hand side of the Value Proposition Canvas (VPC) to understand the customer at a high level
You will need to talk to customers to understand their problems. Getting out of the building and doing customer interviews is the only way to answer the questions above. One helpful tool is a Customer Persona as it helps you understand with whom exactly you need to speak.
6. Once you reach “Problem/Solution Fit” you move to Customer Validation and Experiment Design to get to “Product/Market Fit”
Customer Validation is a four-step process to get market based feedback as to whether or not your solution meets customer needs.
The Experiment Design Template will help you design your experiments. The goal is to allow a team to collect the maximum amount of validated learning about customers with the least effort.
Experiments can be a landing page test, pre-sales, fake doors, Wizard of Oz, concierge tests, or anything else that helps you learn. A Minimum Viable Product (MVP ) is building your product with as few features that will still get you an indication of market acceptance.
Your first product will target Early Adopters
While you eventually may want to be a mass market product, you need to start with your early adopters as they are most willing to try out your imperfect product and grow with you.
Product / Market fit is when you know that you have a product that fits the needs of your market.
Before Product/Market fit, you do Lean Startup to validate your business idea. Only once you have it, you can consider scaling and growth hacking.