You’ve just come up with a business idea that would make Apple’s Tim Cook green with envy. It’s fresh, innovative, and bound to instantly triple your income in no time flat.
You create a business plan, secure some financing, and launch your product or service with gusto.
6 months later you’re not only broke, but broken-hearted. Not only was your business idea not successful; it was a huge, undeniable failure.
So what happened? How could a business idea so promising in its beta phase tank so dramatically in the real world?
The answer is simple: you failed to properly test your idea before bringing it to fruition.
Proper testing is the #1 way to vet a business idea before you spend all of your time and money making it a reality.
Here are 7 easy ways to test your idea before you invest, and to make sure that the rest of the world (or at least your target market) agrees that your business idea is a great one.
- Find a hungry target market
It doesn’t matter if you have the greatest business idea on earth. If no one is interested in what you’re offering, your business will fail.
The first way to test a business idea is to ask yourself who the product or service is for. Is there a hungry target market that’s dying to buy this type of product? Is there a specific group that not only wants, but that desperately needs what you have to offer?
If the market you’re targeting has a laissez faire attitude toward what you’re offering, it’s time to either a) rethink the offer, or b) find a hungrier target market.
- Create a landing page
Before you build a website, sign up for a merchant account, or spend a fortune having professional marketing graphics designed, test your idea with a simple landing page.
This page should feature your product or service and include a strong Call to Action, such as a “purchase now” button or an email opt-in form.
Invest in a low-cost (under $250) AdWords campaign or Facebook ads campaign to drive traffic to the landing page.
Track the number of clicks or opt-in’s you receive, and count each one as a “sale.” If your number of “sales” exceeds the amount you spent on advertising, you most likely have a business idea that’s solid.
If you spend more on advertising than you would have made with a live product offer, it’s time to go back to the drawing board.
- Conduct social media research
A business idea doesn’t appear out of thin air (or out of your imagination). Great ideas that sell are created to solve real problems of real people.
So how do you find out what real people are struggling with?
Simple. Just log on to Facebook (or Twitter, or LinkedIn, or any popular blog specific to your industry).
Research sites where your target market hangs out online, and write down the most commonly posted questions, problems, and rave reviews.
Look for common themes in the data. What does your target market feel passionate about? What’s their most pressing problem? What do they complain about the most?
Your product or service should be a direct answer to a problem or question that’s revealed itself through market research.
- Hop on the phone
Identify people you know who are members of your target market, either through personal or online connections. Set up a phone call or take them to lunch and pick their brain about what they’d like to see in a product or service like yours.
Let’s say you have a business idea for a yoga franchise. Ask your yogi friend the following questions:
- What’s your favorite thing about the yoga studio you currently attend?
- What would you change about it if you could? (Price, hours, teacher, classes offered?)
- Would you recommend your studio to a friend? Why or why not?
- What are you struggling with most right now when it comes to your health and fitness?
The answers may astonish you. If you interview 10 people and 7 of them complain about cheaply made yoga mats, shazam! Instant business idea!
- Test on Ebay
If selling products online, another great way to test a business idea is to create an auction on Ebay before you have a product.
Just like with the landing page mentioned above, you can track bids to get a sense of what people would be willing to pay for your product. You can then cancel the auction or, if feasible, let it play out and fulfill your very first product orders.
- Perform split testing
Split testing is a way to further refine a business idea. If you’re developing a series of fitness videos, you can perform split tests on a variety of different areas including the video’s title, subject matter, graphics, and length.
For example, you might upload a 20-minute workout video to Youtube as well as a 35-minute version of the same video, and test which performs better.
Split testing is one of the most powerful ways to discover what your target market really wants.
- Be different
It’s not enough to look at a business idea, determine what’s brilliant about it, and try to emulate it yourself.
If that worked, everyone would be doing it!
Instead, it’s crucial to come up with a Unique Selling Proposition (USP) that makes your idea stand out from the crowd.
Your USP needn’t be earth-shattering, however. Let’s say you’ve done your market research and determined that your yoga friend in Step 4 loves her yoga studio, but finds their hours of operation inconvenient to her schedule.
Your USP could simply be a yoga studio that offers everything your friend’s studio offers, PLUS has flexible hours. Simple changes that build upon what’s already working are enough for a business idea to soar.
It’s not easy to test a business idea exhaustively – especially one you’re really, really excited about. But taking the time to vet your idea before launching your business will prevent a big, fat, business failure and help you find a hungry target market that can’t wait to get out their credit cards.
For more tips on testing your business ideas and growing your business online, download your FREE Entrepreneur Jump Start Kit by clicking below.
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