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sifatahmed
Jan 11, 2022
In General Discussions
Finding product-market fit seems easy until you realize it’s too late and the horizontal block should have actually been vertical all along. How can you organize the pieces of the product-market puzzle to fit together perfectly? In hindsight, it appears the companies that successfully achieve product-market fit do so with a detailed map from the start, but this is usually not the case. In this article, we explain what product-market fit is, the various states of it, and processes to help you achieve it. Continue reading or jump to our full infographic below. What is Product-Market Fit? Product-market fit is the intersection of the supply of product and demand from customers. Let’s look at the street view of this intersection. When we say the supply of a product we mean any allocation of resources, whether that be human capital, computational servers, or physical inventory. But a product is only as great as the market it serves. This is why demand from customers is the secret sauce. It’s possible that the market a product was originally built to serve transitions, or more commonly, the product is improved to better serve that market. Either way, product-market fit is a process, not a panacea. To determine if a product-market fit exists, it’s important to take an iterative and analytical approach to product management and development. The first step is building a minimum viable product-market fit (MVPMF). Minimum Viable Product-Market Fit Are you building for billions? Most people would place companies like Apple and Facebook on a pedestal and assume they were built for billions from day one. But let’s not forget how they found product-market fit. The first Apple computers on the market were hand-made boards built for hobbyists. Facebook was originally available exclusively for Harvard University students. These are indisputably niche markets but today you are in all probability a user of products from Apple, Facebook, or both. These companies were not originally built for the general public and instead got their start with a much smaller market of early adopters. It wasn’t until much later that these companies crossed the chasm to serve the general population.1 Implement this strategy in your business by starting small and learning from all. Addressing the needs of a small group of early adopters allows your team to learn what they want and build the tools that the general population will feel comfortable using. every day is day one learn from every customer for finding product market fit Product-Market Pivot: Fitting the Product with the Market Did you do your customer discovery interviews? You may have taken this advice from nearly every startup advisor ever and received an overwhelmingly positive reception during your customer interviews. But then you built it and… they didn’t come. You can push all you want to build customers the baseball diamond from Field of Dreams, but if they actually want to play football, then no one will use your product. Enter the product-market pivot. And we’re not talking about multi-purpose fields. A leading Colombia Phone Numbers List indicator of true product-market fit is customer pull, not your push. We’re not saying that you will never have to do marketing again if you achieve a fit. We’re saying that customers should be asking you for more products and features — you shouldn’t have to ask customers to use them. Product-Market Pivot Example In 2007, Justin.tv launched as a 24/7 reality show about Justin Kan. Justin and his business partner, Emmett Shear, were validated by a $50k investment from Paul Graham of Y Combinator and a significant amount of media coverage. Turns out, the market didn’t really care about Justin Kan’s every moment and would rather broadcast their own live streams. After a pivot to user live streaming and the subsequent product-market fit, Twitch was born and later acquired by Amazon for just shy of a billion dollars.2 Sometimes, as this story reveals, the market will tell you what they really want, and other times they’ll mislead you. It’s important you rely on usage metrics in addition to customer feedback. Never rely on customer feedback alone. quote from the anonymous customer on finding product-market fit Does the Market Recommend the Product? More often than not, customers are talking about you behind your back. The question is, are they singing your praises or talking smack? Many people advocate for measuring a Net Promoter Score (NPS) which is the result of asking users the likelihood they would recommend your company to a friend using a zero to ten scales. Unfortunately, the NPS can be a vanity metric. NPS is just another instance of relying on what users say, not what they actually do. The question remains unanswered: are customers actually recommending your product?
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