Prove It or Lose It: The Product Validation Process

You have a great new product idea, which is amazing! But now what?

Transforming your idea into a reality begins with product validation. This important step is to check whether your idea is just an idea or if it has the potential to become something bigger. Let’s start vetting that great idea of yours!

Four Strategies to Validate Your Idea

1. Market Demand: Ensure there’s a genuine need and niche in the market.
2. Value Proposition: Determine the benefits your product will bring to customers.
3. Feasibility: Evaluate the practicality of turning your idea into a viable product.
4. Profitability: Assess the potential to generate financial returns.

Now let’s dig into some details of each validation strategy before investing time and money.

1. Market Demand

‍Create a customer avatar to get clear on who your target audience is, and define and write details about them—their background, demographics, interests, personality, needs, and challenges. Enhance your research with user interviews, online surveys, and polls on professional social sites like LinkedIn. And if you have a prototype, get people’s reactions to it. These early notes are invaluable, so take lots of them!

Another good way to ensure demand is a market analysis. That may sound fancy, but it’s really not—you can do it easily and efficiently! For starters, do an online keyword search associated with your product and monitor social media for industry trends. Pro tip: You can utilize Google Analytics to better understand behavior. You can also conduct a competitive analysis to ensure your product fulfills unmet customer needs—and to check there’s not already a product out there that’s too similar to yours.

2. Value Proposition

‍Let’s start with the big question: What is the value that your product brings to customers? Create a compelling value proposition statement that clearly identifies the problem your product solves for customers and how it stands out in a crowded marketplace. If the market is already saturated, it’s important to highlight how you’re different. Lucky for you, we've got you covered! Check out our guide to your value prop and learn more from our course: Will Your Idea Fly? | Amazon Small Business Academy

3. Feasibility

‍Ask yourself (and answer honestly), can your product idea be realistically brought to life? To answer this, research the cost of production, including specialized expertise if you need it. You also want to assess technical limitations and think about how you would work through those.

4. Profitability‍

Will your product be financially viable? To answer this, conduct thorough (and we mean very thorough) research to understand the production costs and the price consumers are willing to pay for it. Start by analyzing competitor costs, but remember, your initial costs may be higher due to smaller production volumes. You can also reach out to manufacturers to get an estimated quote, keeping in mind they charge for things like storage, production, and shipping. Pro tip: To protect your product and idea, don’t reveal too much, too soon!

Part of the fun and challenge of making your idea come to life is going through the process. And rest assured, there will be wins and losses as you build it. You’ll make mistakes, but you’ll learn from them. You’ll think nothing is moving forward and then you’ll have your breakthrough.

Try to avoid common pitfalls of investing time, money, and effort into developing a product that doesn’t resonate with consumers. Validate your product by taking action across these four checkpoints: demand, value, feasibility, and profitability. In the end, all the research you did to be ready today will pay off tomorrow, and by validating your product idea, you can ensure you build something that people want.