Is Your Product or Service Worth Purchasing?
Not every idea is a good idea. The difference between a good idea and a bad idea is, simply put, will people buy. As entrepreneurs, sometimes an idea can seem like the bee's knees inside your head. Before you get married to your product or service idea, have an open mind and be ready for feedback. Ask yourself these questions as you consider if your product or service is worth purchasing:
- Will people find value in your product or service?
- Is your product or service able to sustain?
- Is your product or service a one time purchase or will you have repeat customers?
- Is your product or service solving a problem? Is it meeting a need?
- Is there anything similar on the market?
- How are competitors performing in the market?
Go straight to the source by doing market research to determine if your product or service is worth purchasing. Use market research to identify what consumers are able and willing to buy.
- Interview potential customers, placing emphasis on understanding their buying habits.
- What are buyers wanting more of and what are they wanting less of? Does your product or service match up with these wants?
- What are your customers searching for online? Identify keywords they are using.
- Search similar products and services that are already on the market. What are consumers saying about them? Find reviews on what they are doing and compare to what you have planned.
- What substitute products are buyers currently purchasing?
Consider the Common Core Human Needs
What needs is your product or service meeting? Human beings are driven by very similar needs, and these drive their buying decisions. First check if your product or service idea fits at least one and preferably multiple core human needs. This will give you a very good idea before getting any deeper as to whether or not what you have is marketable and if it will sell.
The Seven Common Core Human Needs:
- More Money
- To Feel Better
- To Have Better Relationships
- Save Time or Improve Performance
- To Experience
- To Look Better
- To Protect Themselves
Maintain a Positive Brand Image
Customers are highly influenced and persuaded by other customers. Peer reviews are more powerful than a sales pitch. Consumers enjoy hearing success stories and what other customers are saying about different products and services. Capitalize on the thoughts of your own consumers in order to portray a positive brand image. Reviews are one of the top determining factors when consumers are considering making a purchase decision. If your customers love your products/services, they will want their friends to know about it. Turn your customers into your advocates by creating incentives for them when they brag about you.
Recall the basic formula for customer value is Benefits – Cost = Customer Value, Make sure your products’ value and benefits are perceived to be “worth” more than the cost in order to to keep customers happy and your business expanding.
Evaluate Your Product or Service with the Value Proposition Canvas
The Value Proposition Canvas is a simple template that allows entrepreneurs to evaluate their idea through the pains and gains of their customers. Look at your product or service through your customers eyes. As a new customer, is this something you would like to purchase? Using the Value Proposition Canvas will help you identify if your product or service is worth purchasing and what value it will bring.
The Value Proposition:
- Identify your customer's major jobs-to-be-done, the pains they face when trying to accomplish their jobs-to-be-done and the gains they perceive by getting their jobs done.
- Define the most important components of your offering, how you relieve pain and create gains for your customers.
- Adjust your Value Proposition based on the insights you gained from customer evidence and achieve Product-Market fit.
The Venture School program is a 6-7 week program powered by the University of Iowa which emphasizes real-world entrepreneurship and takes you through evaluating your value. Each year, multiple cohort sessions take place around the state of Iowa. The program works for startups, small businesses, non-profits, and corporate innovation teams. For more information on participating in a Venture School near you, view their schedule.