Before starting to build an MVP, it is strongly advised to validate your business idea first. This is a huge topic but I’ll still cover this part as much as possible.
It is said that an idea is not truly validated until people really buy your product or services. I’ve heard of people who could pre-sell their e-books or online courses but I don’t think this is a strategy that can work for everyone.
In our case, we will only seek to confirm that people do show interest in our product before we move to the next stage.
Validate your Business Idea with a B2B strategy
There is no secret here, the best way is to show your face and start talking to potential users who work in your field.
Here is a little story of one of my startup ventures. Back in the days, I was still working for an affiliation platform. One day, a former non tech colleague named Marie, came to me and talked to me about how she and I could create a new deduplication software and rock the world. Deduplication softwares are used by web traffic managers.
Because I was the CTO of that affiliation platform back then, I also knew there was a couple of similar softwares that were in the market for quite some time. How could we possibly catch up to them?
But that former colleague knew something I didn’t know about those existing softwares:
- they are very expensive (starting price was 2,000€ / month)
- they are difficult to use and configure
- customer service was almost non-existent
Since I’m a very skeptical person by nature, so I asked Marie to show me concrete proof that the idea could actually work: “If you want me onboard, you gotta validate your business idea first.”
So she did a very simple thing. She picked up the phone and turned on the speakers so that I could hear the conversion, then she called one of the web traffic managers she knows and started chit-chatting as usual.
Then, she brought up the topic and told that traffic manager that she knew someone who will soon launch a new deduplication software with a starting price of 1,200€/month and also offers customer service along with the license. That person on the phone sounded really interested.
First, she really wanted to know the name of the software and then she wanted to know about the release date.
Then, Marie called two other traffic managers and they showed the same reactions. That was it, I was sold.
I have quickly created the MVP shortly after and launched the product now our business already generates a 5 figure monthly revenue with just one year of existence.
Things can go really fast after you validate your business idea because you are just so focused on solving your client’s problems.
Validate Your Business Idea with a B2C strategy
You could talk to random strangers and try to validate your business idea, but chances are that it won’t be very effective.
First, you need to define your perfect customer. In our previous example, our perfect customer is a web traffic manager who either can’t afford a deduplication tool or isn’t satisfied with his current provider.
Then, you need to set up a very simple website that shows your offer on the home page. On that same homepage, put a “Learn more” Call-To-Action button that leads to a pricing page.
On that pricing page, put a “Subscribe” Call-To-Action button that leads to another page.
At that point, you obviously have no product to sell. So on that last page, you’ll just have to explain to that disappointed customer that the software is still under development and that he may be notified when the product is launched. You could even put a Newsletter subscription form there!
One last thing to do on your website is to plug Google Analytics on all the pages so that you can measure the engagement rate of your visitors.
Now that you have your website and have defined your perfect customer, you need to reach out to them. Because we’re all about online business, you are going to use one of the most powerful marketing tool available: Google Adwords.
Open a Google Adwords account and start your first campaign with your keywords. Make sure to cap your budget and keep an eye on your expenses, we don’t want to spend too much.
Let the campaign run for a entire week, then analyze the results. Here are the few indicators you should watch:
- Bounce rate
- Average page views
- Average session duration
- Conversion rate of pricing page
Also, make sure to check the list of your newsletter subscribers.
Now, you know how to validate your business idea!