November 28, 2023

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Determine Your Business Idea’s ‘Market Need’ With These Top Strategies

Whether your business is still just an idea or you’re in the research phase, it’s never too early to think about determining market need. It’s essential to figure out what consumers need from your product and pinpoint a target audience.

However, there are many ways to effectively determine market need for your particular product or service. To help you do this, eight members of Young Entrepreneur Council explain some specific strategies for uncovering the need for your idea. Follow their recommended tips to complete this essential part of your business research.

1. Identify Solvable Problems

Don’t overthink it. Too many “ideas” get stuck at the starting gate and never turn into a reality because of overthinking. I’m the founder of six different companies, and every one of them has been built on the same concept: identify a problem I can solve that people are willing to pay me to solve. Not every idea will be the next Uber or Facebook, and if you spend your life trying to do that, you may end up disappointed. My businesses have not been unique. I haven’t developed any proprietary tools. I’ve consistently been able to leverage or build off of existing systems and build a better mousetrap. There will always be someone willing to pay for expertise, and if you can identify those areas and capitalize on them, the market will gladly pay a fair price for a quality experience. – Frank B. Mengert, ebm

2. Talk To Potential Consumers

The only thing that matters is whether customers want to buy your product—so talk to customers. To validate whether they would buy your product if it was built, try and get some form of commitment from them. For example, get them to commit to being a beta user, say that they would spend X amount of money on it if you built certain features or, ideally, say that they would pre-pay to become a beta customer. If you can get strong commitments from early customers, you know you’re on to something. If you’ve had a lot of conversations but you can’t quite get anyone to commit, maybe you should rethink your idea. – Ashwin Sreenivas, Campfire

3. Follow The VC Dollars

One of the best ways to identify a substantial profitable business opportunity is to look at where venture capital dollars are going. VCs push money to areas where help is most needed. If you see growth capital going into one area, you can bet that business ideas involving that will be very good. Otherwise, you are wasting time solving too small a problem. Additionally, and of equal importance, you need to talk to the customers. Let the market tell you where to go; don’t lean on your own brand. – Kevin Marcus, Versium Analytics, Inc.

4. Google It

Do a Google search. What question would a potential customer type into Google to find a product or service like yours to meet their need or solve their problem? That’s the question you should type into Google. The search results will help you determine if the need is generating a large number of inquiries and if any other companies are already fulfilling that need with a different product or service. Don’t stop there. Think of different questions people would ask to find a product or service like yours and type them all into Google. Look at the related queries that Google provides at the bottom of the search results page. Dig deeper. Visit the results pages and see what people are talking about and what products other companies are offering to meet their needs. Then, offer something better. – Jonathan Prichard,

5. Get Feedback From Others In The Industry

Talk to people in that field and industry. Some ideas are brilliant; others are terrible. You will really want to figure out which one yours is before investing time, energy and resources. Absorb feedback from others. Change and edit your plan as needed. The worst thing you can do is think you know it all and fall flat on your face. Opinions and feedback are free. This is your best tool in determining if your idea is worth pursuing or if it still needs some fine-tuning before it is ready to release. – Mary Harcourt, CosmoGlo

6. Get Involved In Your Target Community

The easiest way to find out if there’s a market for your business idea is to get involved in the community you would like to enter. I suggest spending time in relevant social media groups. You could start new conversations, comment on existing posts or even conduct a survey. Write down what you learn during these encounters and use the data when planning your product and website. For example, let’s say you want to create a new email marketing software. Everyone in your social groups says they want to see more segmenting options, so you can safely assume that this feature would do well if you included it with your software. I believe this step is crucial to your success because you have to meet and exceed customer expectations if you want to thrive in a crowded industry. – Chris Christoff, MonsterInsights

7. Consider The Competition

Look for a competitor for your business idea. There is always a competitor; if you think there is no competition, then your idea is not a business idea yet. After identifying your competitor, analyze their sales trends, their market and their flaws. This will give you an idea of whether your product will be accepted in the market and what the possible sales trends for your product will be. It is important to do this early on because you will learn what not to do in your business. Someone’s failure or success strategy can be a cheaper learning lesson for you. It will allow you to adapt your idea and strategy to a way that works practically as opposed to what you think will work. – Kripa Shroff, AK Multinational LLC

8. Leverage A Focus Group

Conduct a market research focus group. You can do it on your own or employ a company. That way, you’ll find out from normal, everyday people if your business idea will actually gain traction, and the feedback will be honest and valid. – Andrew Schrage, Money Crashers Personal Finance