The best business ideas are validated by customers in the marketplace before the product or service is fully developed. Savvy entrepreneurs research the wants and needs of prospective customers with the ambition of creating value through unique and memorable experiences. Throughout the LEAN process, opportunities originate early with customer data. The value and experience are refined throughout the execution period with refinement of the product or service with feedback from customers.
Everyone has an opinion. Arguably, the opinion that matters least initially is that of the entrepreneur. It is easy to eat your own cooking. The one that matters most is in the marketplace. The market is a synthesis of relationships, influencers, and decision makers. Furthermore, it is in the marketplace that the entrepreneur will learn what goods and services are in need, who will buy them, and how they will buy them.
The following are 4 simple steps you can use to conduct a basic customer discovery.
- Identify what your idea will solve
- Draft the assumptions about the idea
- Perform real and personable market research
- Assess the data and refine your concept
Now try utilizing the steps with an example of grocery shopping:
- Identify what your idea will solve
- Reduce the time it takes to shop for groceries
- Draft the assumptions about the idea
- Shopping time for groceries is a problem
- Our approach will solve the problem by notably reducing time
- The market recognizes this as a problem with real pain
- A large enough segment of the market will pay for our solution
- Perform real and personable market research
- Go to grocery stores and ask people in the parking lot
- Organize focus groups
- Perform surveys
- Perform randomly selected personal interviews
- Use social media to inspire conversations and gain feedback
- Use physical questionnaires
- Assess the data and refine your concept.
- Leave hubris and bias at the door and listen to people in the market. That is the secret to making money.
Entrepreneurs put real effort and money at risk. The customer discovery process will challenge your assumptions and teach you things you did not know about the market. With this information, entrepreneurs can refine the concept for what the market wants and identify who will buy and how they will buy it. Note that not all business ideas find a market. In the final analysis of the customer discovery process, entrepreneurs are rewarded with solid returns or spared from throwing money down the mine shaft.
The UMW Small Business Development Center (UMW SBDC) is here to help you along the way of your customer discovery phase. Are you searching for a market or are unsure who your customer is? The UMW SBDC provides market research for your industry, so you can analyze and adapt your business idea for the ideal customer base. Email your consultant to schedule a meeting or fill out our request for consulting to get started.