21 Oct · 4 min read
The term “Product fit” is something everyone might have heard of but only a few truly understand the real meaning behind it. The path to product-market fit is not everyone’s cup of tea. You might often find founders who believe that they have found the right product/market fit when they don’t have. This is the problem that most of the founders start acting relentlessly without looking at what product needs to be built. It is all about the problems that ask for solutions and waiting to be recognized by the market making it all worthwhile. Now you must be wondering “What is Product Market Fit” and how would you know that your product is on the right path? In this article, we will explore several insights regarding product-market fit to help you make informed decisions.
Entrepreneur and investor Marc Andreessen referred to “Product-Market fit” as a “means of finding the appropriate market with a product that has all the capability to satisfy the market needs in his 2007 blog post. He further adds that “the customers are curious to buy the product as soon as you launch it in the market or you can also say product usage is growing just as fast as you are able to add more and more servers.” The entrepreneur also says that the life of a start-up is dependent on defining its right product market fit. Thus, separating the life of a start-up into two key stages:
Product Market Fit is basically the first and foremost metric that you need to meet to close all your important partner deals. Achieving the right Product-Market fit is highly important for your business or else be ready you to face severe consequences.
If we look at the wording of Alex Schultz, VP, of Growth at Facebook, says that the biggest problem that he observed with start-ups is that most companies face the belief of having the right product-market fit when they don’t have it. So, you must be wondering why achieving it is so important. Why do investors ask companies to present the proof of right product-market fit before making top-notch investments? And so on. These are some of the questions that hide brief answers that every company should strive for.
Before developing a product as per your wish, it is highly recommended to find whether your product resonates with the demands of the market or not. There is no sense to create a product that does not hold any demand in the market. It is good to come up with the MVP (Minimum Viable Product) to target the initial customers based on your niche. Following this strategy will help you get real-time feedback from customers depending on which you can further develop different versions associated with your product. To find the product market fit, try to target the market where people are dealing with genuine and real problems, and listen to them effectively. There are many big companies such as Netflix, Google, etc. that have got their product market strategy on point and made it big in their respective niches.
Achieving the best product-market fit varies from company to company. There are no special metrics that can depict if your business is heading toward the right product-market fit or not. In Dan Olsen’s Book, ‘The Lean Product Playbook’, the author focuses on a high-level approach that your company can adopt to crack the right code in six steps:
1. Identify your Target Audience
2. Determine the unsaid demands of the customers
3. Establish the Product Value Proposition
4. Build a Strategy to Develop Your MVP (Minimum Viable Product)
5. Develop a Version of the MVP Prototype
6. Test MVP with Your Users
Implementing the above steps to make strategic product-related decisions will help you head in the right direction with all the necessary information available at your end.
With all, that is being said and mentioned above, the key to identifying the right market for your product is no less than a gamble. But following a step-by-step approach will help you get half of your things done without putting a financial burden on you. Once you have found your product-market fit, you can easily optimize your product, hire experienced manpower, and ensure smooth investments. Congratulations, you have made it all that most companies fail to achieve just by doing everything step by step.