You will hear it time and time again, validating your idea is what separates a successful business from a complete failure. And yet, many aspiring entrepreneurs completely skip it. The ones that do run successful businesses admit to spending 60-80% of their time validating their idea with customers at the beginning stages of their startup. So in short- do NOT skip this step.
So with market validation as a top priority throughout the entrepreneurial journey, where do you start?
The first step is to start with the problem.
The common misconception aspiring entrepreneurs have is that your idea has to be great, but that is a complete misconception. The most successful businesses, in fact, start with the problem and the customers who struggle with that problem. Study the problem you are trying to solve. Through this research, you can identify gaps that exist in a specific market.
The Olasso team has has put together a quick, easy, and FREE process that helps better analyze a problem. The sources of these methods come directly from entrepreneurs who have found tremendous value and success using these methods. And fortunately enough, you already have the tools within your disposal.
Let’s begin with the “tools” you would use Google search
- Reddit search
- Amazon book reviews
We also put together a worksheet to help frame up your research. To help contextualize this sheet and the process, we are going to start with our example problem:
Problem Statement: Millennials (ages 25-36) struggle with saving money.
In this example, we have 1) identified our market 2) identified a problem we assume exists in this market.
Leveraging our worksheet, we need to identify who are submarkets are because, well, not all millennials are the same
So we start with good old Google. Type all the keywords related to your problem. Our keywords include:
- Saving tips and tricks for millennials
- How to save in your 20s
- Making smart financial decisions as a millennial
From these searches, identify the top performing sites and the contents of them. This is a moodboard of what we got and our assessment.
From the looks of this we’ve identified the following subgroups. Into the sheet we go!
Hopes and Goals
Now this part of the sheet and moving forward will help assess the mindset and emotional state our target audience is in. This part will take time and that’s a good thing. The turning point is when you are able to capture your target audience as a familiar character, with the ability to holistically understand who your audience is.
Tools: Reddit, Quora
Why? You can find communities easily here and most visitors really deep dive into a specific problem. Look for communities that fit this profile. We chose:
- r/djfdf Reddit
A good idea here is to collect insightful quotes that capture a sentiment. Fortunately we added a column into the sheet we provided.
From our search, here is a moodboard of quotes that sum up our audiences hopes and dreams.
From what we are seeing, we can sum up their hopes as
Fears, Pain points, and Obstacles
But what are their pain points?
Tools: Reddit, Quora, Amazon book reviews
You can use the same process to filter through quotes that capture pain points. We have also found helpful results by looking Amazon book reviews. Look at top selling books around saving money, select comments that are three stars or less, and collect quotes. Here is what we have gathered.
From our findings:
- Millennials fear XYZ
- Obstacles include
With all this research, we can reasonably assume that:
- Millennials want to save money for a down payment
- But they worry that the day to day spending gets in the way of making larger purchases in the future
- The obstacle is they spend too much on moment to moment purchases, there is no form of accountability
Now the best way to test these assumptions is to ask people who fit this demographic and ask these very same questions.
- Is saving money a problem? Why?
- What do they hope to achieve if they didn’t have this problem?
- What are fears, pain points, and obstacles getting in the way.
Once you’ve tested these assumptions, you can finally start thinking of solutions that would cater to this need. Brainstorm with some friends, other peers in your target audience. Once you’ve got a list of solutions, let’s start validating. Check out the next section to validate that idea