Starting a business and launching a new product in the market requires patience. Most beginners in the business fail at some point to achieve the objectives of the business simply because they fail to achieve product-market fit. But then, what is the product market fit? In simple terms, product-market fit is that point where your products provide a real solution to the demands of the users. When the product’s demand keeps increasing due to its efficiency in the market, then you have reached at PMF with no doubt.
To study the product-market fit, it has to be monitored and tracked as it grows. The product-market fit is not meant for start-up businesses only. It includes even well-established enterprises. Also, if your business is big enough, it is vital to monitor your products on how they offer solutions to customers. Know when the customers still require your products and services and provide them appropriately to keep the business growing.
Any person who sets up a business aims at reaching potential customers, satisfying their needs, and making a profit from the business. However, there are moments when they fail to fulfill all these needs. The reason for failure is due to poor strategies used in the entire process. As a result, there is always that gap left when trying to fill the requirements of the customers.
Therefore, if you want to reach the product-market fit, ensure you can answer the following questions:
- Do my customers require my products or services?
- Are my products and services fulfilling the needs of the customers?
- What can I do to improve the demand for my products and services?
Well, reaching product-market fit does not come easily. You have to dedicate your time and efforts to reach your target. Software Product Development experts suggest adopting the product-market fit pyramid to reach a point of product-market fit.
The pyramid involves technical stages that must be followed to create that market you want for your products and services. The pyramid includes five key elements; the purposed end-users of the product, the needs that aren’t fulfilled, the value proposition, feature set, and UX.
The stages are arranged hierarchically, and each stage is dependent on one another. When the stages are followed step-by-step, you will get guidelines on how to improve your services and reach product-market fit. In the event of following the five steps, you will realize you are forming assumptions that will turn your dream of achieving a product-market fit come true. Discussed below are the phases involved in the entire process.
Stages of reaching Product-Market fit
- Know your Targeted Customers
Before anything else in business, you must identify the missing gaps so that you offer products that are in dire need. However, once you know the type of business to set up, you ask yourself, who am I going to sell my products? Understanding your purported customers is the initial stage in any business. This stage is crucial because different groups of customers have different needs; hence every customer is distinct in their ways.
When you analyze your product at an angle of a given client or customer, you can identify their preferences and augment the product according to the specified preferences. Some of the technique you can use to distinguish the needs of the customers to create products that much of their requirements is market segmentation. This technique will help to know the type of customers to serve so that everyone creates products that match the needs of the users. Market segmentation technique helps to create market sub-groups based on the following:
- Common interests
- Psychographic &
- Needs of different customers.
If you skip this initial stage of knowing your customer, then you are set for failure. Your product will fail to reach the product-market fit.
- Knowing the Unfulfilled needs of Customers
After conducting research and knowing your customers well, there comes a second stage, which is crucial in the process of achieving product-market fit. The second stage involves identifying the needs of the customers that are not met. This is a stage that will unleash the potential of penetrating the market with ease. When you identify and know the needs of the customers who aren’t fulfilled, it is a great chance to come in and fill the missing gap. Once you address such demands that are not met, you open a way for your products and services to reach the next level.
The technique used here involves listing out the problem space and the solution space. With the problem space, you list all the issues affecting the customers, their needs, and the benefits they will get from the product. On the other hand, solution space highlights a list of different strategies to meet the requirements of the customers.
When using problem space and solution space, you can grasp the nature of competition involved and come up with alternative products that are existing in the market to fill the needs that are not met. The product will also serve the requirements that are met halfway.
- Defining Value Proposition
Stage three that comes after working on the needs that are met halfway is determining the value proposition. The step involves evaluating how unique your product will be from the competitors’ products. You should answer the following questions at this stage:
- What is the purpose of my product?
- How is my product distinct from the rest?
- What will make the customers excited about my product?
This stage is vital in the process because it enables you to achieve a suitable product-market fit that you have been working towards it.
- Identifying your MVP- Minimum Viable Product
Here is the fourth step in the process of achieving a product-market fit. It involves understanding your MVP and listing the type of functionalities that will be included in a minimum viable product. It is vital to meet this stage before launching the product because it helps in this stage has features that will approve if you are on the right move towards achieving product-market fit. Among the benefits you will get at this stage include cost-effective budgeting, market approval, and above all, obtaining reliable information.
- Creating a Minimum Viable Product
This is the fifth and the last stage in achieving the right product-market fit. It involved creating an MVP. To create the right minimum viable product, make use of a good UX design practice to come up with a prototype, understand how the product will work, and then test the minimum viable product to your targeted users.
It is essential to test the MVP at this stage because it will help you get the feedback from the users you are targeting. Skipping this stage means that you won’t get the views of your customers, which can lead you in the wrong direction. When you get reviews from users, you can analyze and know if the product has answered all the questions discussed in the previous stages. It is through answering those questions that you will know you have achieved the desired goal for your business.
Note: The final product you have created includes all the information you gathered since the business idea came into your mind. As you create the MVP, it is required of you to put all the considerations in mind to choose the right move at once.
Remember, your main goal is to achieve a product-market fit and penetrate the market well.
For any business out there trying to penetrate the market, the process of product-market fit is indeed an excellent way to go. First of all, the process enables you to identify the missing gaps and how you can fill the gaps. Following the steps mentioned above will lead you to achieve product-market fit. However, regular minimum viable product based on the reviews of the customers is the secret towards reaching a perfect PMF. This shows that customers play a critical role in the business world. They control the operations of the business.
The type of reviews the customer gives determines the next direction you will take. You can either move ahead or make a U-turn. If you failed at stage four, then it means you have to review stage three before you continue. But if you messed at stage three, you have to go back at stage two. If the problem is identified at stage two, then you start again at stage one. In any case, ensure every step is done correctly before moving ahead.
Note: In every process that is repeated, you will have to try with different customers. The goal is to attract positive reviews as much as possible so that you can move to the next step. Positive feedback’s show that you are almost achieving the product-market fit target.
It is essential to follow the five steps keenly to minimize wastage of resources. If you take chances and launch your product without following the above steps, the outcome might backfire, and you end up spending more costs of repeating processes that you could have rectified at an early stage. When you launch the product, ensure that the customers approve it for it to achieve product-market fit faster.
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Original source: https://www.aalpha.net/blog/how-to-achieve-a-product-market-fit/