5 seconds to validate your idea

[Scot]

We see this weekly on the forum.

"Hey guys I'm new here, I had a great idea to sell widgets to custom picture framing stores!"

Then we get the inevitable analysis.

"Well based on research, custom framing is being take over by craft stores like Micheals and Joann Fabric. There are only 1,200 operating in the country. If you could sell 2 widgets to, 10% that's only 240 widgets. I don't think your market is there."

Save yourself the headache of coming up with your billion dollar idea then finding out a market simply doesn't exist. Visit https://business.highbeam.com/industry-reports

You can get a good overview of the market you're targeting for quick validation. If it passes this quick litmus test of simple numbers, then you can move on to more in depth market research and validation.


We see it time and time again. VALIDATE before you execute. There are plenty of current and former Fastlaners who made this mistake, learn from it so you can save yourself time and money.


*disclaimer: I do not own or have any connection with that website. It is simply a tool I used to evaluate the market for my business. I found it through Google search.

 

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[WebMedic]

When you are ready to move to a more in-depth study The Personal MBA covers validation in a nice framework of 10 questions.

Can be found here: https://personalmba.com/10-ways-to-evaluate-a-market/

 

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[amp0193]

We see this weekly on the forum.

"Hey guys I'm new here, I had a great idea to sell widgets to custom picture framing stores!"

Then we get the inevitable analysis.

"Well based on research, custom framing is being take over by craft stores like Micheals and Joann Fabric. There are only 1,200 operating in the country. If you could sell 2 widgets to, 10% that's only 240 widgets. I don't think your market is there."

Save yourself the headache of coming up with your billion dollar idea then finding out a market simply doesn't exist. Visit https://business.highbeam.com/industry-reports

You can get a good overview of the market you're targeting for quick validation. If it passes this quick litmus test of simple numbers, then you can move on to more in depth market research and validation.


We see it time and time again. VALIDATE before you execute. There are plenty of current and former Fastlaners who made this mistake, learn from it so you can save yourself time and money.


*disclaimer: I do not own or have any connection with that website. It is simply a tool I used to evaluate the market for my business. I found it through Google search.

I love that link.

Look at all these business avenues that I didn't know existed and are probably ripe for opportunity.

I'm going to be digging through there for fun tonight

 

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[Scot]

Great link, thanks for posting it.

When looking at data like that do you use certain %'s or numbers to determine if it is a good prospective overall market?

It depends on what you're selling. It's a game of multitude vs magnitude. But a good way to assess it is, could I survive with only 1% of the market? If not, you may need to either find ways to increase revenue per customer or find a better market.

Keep in mind, rough numbers like this are only a small step to evaluating the market. You still need to establish a demand for your product.

 

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[Torobaro]

Thanks! great tool

Also and just on a side note I recently read a quote by Steve Blank where he said market research firms and industry analysts are great at predicting the past, not the future

 

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[Scot]

Thanks! great tool

Also and just on a side note I recently read a quote by Steve Blank where he said market research firms and industry analysts are great at predicting the past, not the future

And taking all your money to do it too.

 

[Scot]

Thanks for the quick response, Scot!

I was thinking to use this website to find a niche product or business idea. So, honestly I would using it has a brainstorming tool rather than validating an idea. Do you know of any other resource which could be more helpful, if not this?

Regards,
Adam

Oh man, that’s opening a whole can of worms when it comes to finding your industry or niche. There are whole books written about this topic.

Here’s what I’ll say though. Bra thing a website like this, trying to find an industry that looks promising, probably won’t be the best method for succeeding. The reason I say that is because, say you find out that elevator repair shops are a bigger industry than you thought it wise and you want to pursue that. What do you know about elevator? What do you know about elevator mechanics?

I find it’s better to find an industry or niche that you at least have some basic knowledge or experience. Just observing your surroundings, problems you have at your day job, problems you have in your daily life, those will find a niche that you can speak with some authority on.

Here’s my first progress thread for reference. EXECUTION - First time entrepreneur, here it goes!

It’s not long, because it didn’t go anywhere. But I used this tool and said, “wow, there are a lot of barbershops!” But I didn’t know a damn thing about how barbershops were run, how barbers made their money, etc.

Just some things to consider...

 

[Scot]

Glad I could help! There are a few sites out there that do industry/market analysis, but I really liked this one. It's a quick way to test out an idea.

 

[I Am I Said]

When you are ready to move to a more in-depth study The Personal MBA covers validation in a nice framework of 10 questions.

Can be found here: 10 Ways to Evaluate a Market - The Personal MBA

Bumping an old post here, but followed a link in @Scot 's signature, which led me to an excellent highbeam article; and also, you reminded me to go back to Josh Kaufmann's excellent book. Thank you! I read so much I sometimes overlook the good, simple stuff.

 

[Patrick R]

Hey Scot,

Thank you for posting this! It's been a massive headache for me doing hours of looking, per idea, when a large chunk of the information I am looking for is right here! I appreciate the share!

 

[AlphaWulf]

Thank you for posting this. This will save me the trouble of putting my heart and soul into something, only to find out that it was doomed from the start.

 

[Scot]

Oh snap, it looks like it has been shut down. I'll see if I can find any others.

 

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[Scot]

Hi Scot, That research site is good but not for validating my product. My product is a new application of an old technology. I've been reading testimonials/complaints about the "competition's" product to validate my product. It's a really fuzzy method but it beats doing nothing. I'm also taking concurrent steps to create the product/label/packaging...
I haven't set up a timeline because I have no idea of how long stuff takes. And the manufacturers/suppliers from India are unpredictable about getting back to me.
Please post any other ideas you have about validating a new product. Thanks again, Greg

Validating a product is pretty well documented here on the forum, just search any thread about ecommerce, namely anything by @biophase

What I can say from experience is that the only real way to validate a product is through selling it. Try and get a large sample order and sell them to people, see if they'll vote with their wallets.

One thing I did to semi-validate my market was to put out a survey (with permission of the admins) on a large support group on Facebook. Within an hour I had over 120 responses. That convinced me for sure that people were ready to buy.

But it wasn't until I actually get sales on my website and Amazon that I really knew if the market was viable.

 

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[jcvlds]

The way I think about it, Scot’s initial post was more geared towards validating the total addressable market, then estimating a realistic serviceable market, and finally your obtainable market that you could win.

Validating in this sense, to me, means more so ensuring that the market (potential customers) is large enough to go after.


On the other hand, validating your product/service is like Scot mentioned, ensuring that the demand or the need is strong enough that people are actually buying and not just entertained at the solution. I agree with Scot that actual purchasing is probably the greatest validation of just the product-market fit. However, you would probably still need to see some of your metrics in terms of conversions and won-closed-deal ratio to determine estimates of your obtainable market from the total addressable market.


Not sure if I’m explaining my thoughts well enough, let me know any questions or doubts.


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[YoungBroward]

this is really gonna help, thanks!

 

[Action Mike]

Great link, thanks for posting it.

When looking at data like that do you use certain %'s or numbers to determine if it is a good prospective overall market?

 

[sam9530130]

Great resource to validate/look for ideas. Thanks

 

[Jay7]

Great share. Thanks!

 

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[McFirewavesJr]

Exactly what I've been looking for. Gracias!

 

[Wolfman]

Glad I could help! There are a few sites out there that do industry/market analysis, but I really liked this one. It's a quick way to test out an idea.

Scot, The site was really helpful. It led to ideas and other ideas...So you started a brainstorming waterfall. Greg

 

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[ShellShock]

This site is also a good way to access information pertaining to your business, or processes that make it up. Want to improve your advertising? Search for consumer insights/ psychology journals and magazines. Own a gardening business? See if you can find information regarding the gardening business that can improve your own.

Thank you for this thread Scot.

 

[DeepScripted]

Scot,

Thanks for the feedback. I’ll look into your progress thread. Appreciate your feedback, and good luck with your endeavors

Regards,
Adam


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[Crisdamien]

Oh man, that’s opening a whole can of worms when it comes to finding your industry or niche. There are whole books written about this topic.

Here’s what I’ll say though. Bra thing a website like this, trying to find an industry that looks promising, probably won’t be the best method for succeeding. The reason I say that is because, say you find out that elevator repair shops are a bigger industry than you thought it wise and you want to pursue that. What do you know about elevator? What do you know about elevator mechanics?

I find it’s better to find an industry or niche that you at least have some basic knowledge or experience. Just observing your surroundings, problems you have at your day job, problems you have in your daily life, those will find a niche that you can speak with some authority on.

Here’s my first progress thread for reference. EXECUTION - First time entrepreneur, here it goes!

It’s not long, because it didn’t go anywhere. But I used this tool and said, “wow, there are a lot of barbershops!” But I didn’t know a damn thing about how barbershops were run, how barbers made their money, etc.

Just some things to consider...

I really appreciate this thread. I have an idea for my website and niche, it's something that I've needed and had a pain in the a$$ moment with. I had the" this sucks, wtf, I have to do this and shit is annoying" moment.

It's a niched down site, amazon and the big box stores have it, but mostly it's an afterthought. But the diference with me will be, I fulfill a need i.e. information that can tilt value before buying.

 

[jcvlds]

Hi JC, Thanks for talking about validation. I'm in the conundrum where I need a product in order to validate unless it's a purely hypothetical survey. Ex. "would you buy xxx if it cost yyy?" (That is tough w/ B2B products.) Anyhow, just thinking in terms of validation is a good practice. Thanks again, Greg

Hey Greg,

I think every product and every market will be different as to how quickly or easily you can ‘validate’ it.

For your physical product, is your target buyer different than the end user of the product? What’s the problem the product solves?

I think it’s hard to really find a viable path to validating a product and a market without knowing more specifics. If you can share more maybe I can be a bit more helpful


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[Scot]

Great addition, thanks!

 

[Scot]

I love that link.

Look at all these business avenues that I didn't know existed and are probably ripe for opportunity.

I'm going to be digging through there for fun tonight

I didn't even think about that...

 

[Action Mike]

0

It depends on what you're selling. It's a game of multitude vs magnitude. But a good way to assess it is, could I survive with only 1% of the market? If not, you may need to either find ways to increase revenue per customer or find a better market.

Keep in mind, rough numbers like this are only a small step to evaluating the market. You still need to establish a demand for your product.

Makes sense, thanks.

 

[DeepScripted]

Scot,

Thanks for sharing this website. I'm researching product and business ideas and this can be a very good start to direct my efforts in the right direction. @Scot, I see this thread is a bit older - do you think this is still the best resource for research? If yes, what's the best way to use it? I'm thinking to get the monthly membership and archive the information first - or do you think getting the annual membership is worth it?
Thanks for sharing this jewel again!

Regards,
Adam

 

[Scot]

Scot,

Thanks for sharing this website. I'm researching product and business ideas and this can be a very good start to direct my efforts in the right direction. @Scot, I see this thread is a bit older - do you think this is still the best resource for research? If yes, what's the best way to use it? I'm thinking to get the monthly membership and archive the information first - or do you think getting the annual membership is worth it?
Thanks for sharing this jewel again!

Regards,
Adam

I honestly never dove that deep into the website. It was more of a validation tool for me. How much do you think your business will rely on this type of data to get off the ground? Would your time and money be better spent just talking to potential customers?

 

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[DeepScripted]

I honestly never dove that deep into the website. It was more of a validation tool for me. How much do you think your business will rely on this type of data to get off the ground? Would your time and money be better spent just talking to potential customers?

Thanks for the quick response, Scot!

I was thinking to use this website to find a niche product or business idea. So, honestly I would using it has a brainstorming tool rather than validating an idea. Do you know of any other resource which could be more helpful, if not this?

Regards,
Adam