What is Market Validation?
To simplify it, market validation is a means of testing your product concept against your target market. It’s a way of marketing a hypothetical product without incurring the cost of actually building it.
Mostly market validations combine of a series of lengthy interviews with people who happen into the demographic you think will be buying the final product. Interviewers are trying to get past the simple, “Do you like this idea?” questions to determine if people would actually buy something.
Experts in this field have said that they take around four weeks in a minimum and an average of six weeks with eight weeks being common to complete market validation. This study varies according to the number of interview questions taken and the size of the research team.
This time frame is a bit too much for most of the businesses. Businesses cannot afford to spend that much time over research. Merging the traditional interview driven method and online surveys can get you the best results in a significantly small amount of time
When beginning a new online business, or expanding a previously existing one, it is significant that you not only identify a specific niche market to work within, but also that you spend some time on market validation to ensure that your chosen market is, in fact, profitable.
Traditional methods to market validation recommend a weeks-long effort carried by a team of market researchers, however, the ever-increasing pace of innovation makes this timeframe unrealistic.
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By the time you’ve concluded an eight-week market validation, circumstances may have changed so dramatically that they invalidate your results.
But with a strategic combination of online surveys and in-person interviews, you can dramatically reduce the cycle of market validation.
Shorter cycles imply less wasted time and effort, as well as more current data.
There are four very significant questions that you need to ask yourself about each niche market idea that you choose to pursue in order to determine if it has real potential:
1. Can the market be easily defined and is it easily reachable?
You need to know where the people who make up your possible market gather online. You should find out what publications that read, where they go online to look for or share information, and whether or not they have clubs or events that bring them together.
In most cases, your market will already have places online where its members congregate. You should look for groups, forums, clubs, discussion boards, and special websites where people in your market go to connect with each other. You can do a simple Google search to get some good information to start out with. You can then examine the links that are included on the resulting web pages to get even more ideas.
2. Is the market big enough for you to make a profit but small enough that there aren’t too many competitors?
If your market contains a lot of competitors with big budgets, it might be too difficult for you to break into successfully. A lot of solid competition is a warning sign that you should start looking for a smaller niche with fewer players.
3. Does this market have, and is it willing to spend, money?
Of course, you’ll want to know whether or not the people in your market actually buy things. Sites that sell products to the members of your potential niche market are a good sign. This indicates that there is a viable market for related or improved products that you can possibly tap into and make a profit from. These existing websites are also good candidates for joint venture partners later on down the road.
Pay attention to whether or not your market has a lot of websites offering free products and services though. People won’t pay for something that they can already get for free, so this should be a warning sign that you might want to consider a different niche market.
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4. Are the people in the market passionate about the topic of interest?
The best market is one in which the people are passionate about whatever interest or topic it is centred around. You want to find a market in which the people are eager to get their hands on any and all information and products relating to the specific topic of interest.
To conclude it all, market validation is extremely important for a dynamic business.
Market validation tools like Howkya give all the answers to your questions, all in one place. You can find your target market, including experts of a particular field. In this platform, you can make a questionnaire and get instants answers to all your questions.