How do you know if your product fits the market? Is this something you can measure? Entrepreneurs spend a lot of time in customer discovery research pursuing the holy grail of product-market fit. The journey to find it is so intense and draining that there is the temptation among many to get the pedal off the gas once product market fit validation is “achieved”. This could not be a greater mistake. Product market fit is not a static state.
There are many definitions on what it is, and they run over a spectrum. Someone may tell you that product-market fit exists if you have a product and service that people want, and they part with their money for it. You consistently sell your product and it slowly grows in market acceptance and makes your business sustainable and even predictable to some level. Now imagine a friend or co-worker telling you about a product or service they love so much that they recommend you use it, without you even asking. Isn’t that evidence of a stronger product-market fit? Products that get recommended by word of mouth grow in market adoption much faster. Now think about the product that a company can’t stock fast enough before it goes out the door, or for which you can’t hire salespeople fast enough. If you have a product or a service like that, you would know for sure you’ve got product-market fit, wouldn’t you?
Now ponder, what good does it do to know you have product market fit if you’re operating under this last scenario, which essentially confirms that you have it? I guess a better question would be: what good does it do to you to know this – after all the painstaking toils and failed attempts and dead ends and weeks and months of hardship you had to endure to get to this point? Knowing you have product-market fit by looking at a lagging indicator is good and everything, but, wouldn’t it be a thousand times better to be able to discover and measure a leading indicator of product-market fit, and by-pass or fast-track through a lot of the hardship?
Marketers that call themselves growth-hackers have devised ways of doing this. There is a general methodology, but in each case applied specifically. It would be wise for you to understand it, or the intent behind it, and it could make the difference between running a nice company that grows with its market, and a growth company that eats away at its market faster than the competition.
It all hinges around clearly understanding the motivations that lead your first customers to buy your product. Once you get initial customer traction, your capacity to obtain relevant actionable data from these sales can help you discover what the leading indicators are. One way to do it is by surveying these customers, and asking them how they would feel if they could not buy your product anymore. You could also ask them to tell you the feature they most like about it, and what feature would make it better.
Carving out the respondents with the highest negative reaction to losing your product (let’s call them group A) and understanding the main benefit they perceive from it, and cross referencing it to the respondents which do not have such a big negative reaction to losing it (call them group B – people on the “fence”) but that at the same time share the same main perceived benefit that those in A will lead you to discover the features that people in group B would like to see that would get them over the “fence”. These are the features that hold your group B customers back from truly loving your product. Following this general methodology would give you measurable metrics on product market fit, and a leading indicator on how to increase it.
For you to become a growth hacker, you should gather feedback from every customer in a systematically designed way. We have mentors at the Innovation Hub who can help you figure out these methods. Doubling down on what users love about your product (because you have measured it) while at the same time investing in the features that are slightly holding users back from loving it, will increase your fit to the market, drive adoption, and leave your less sophisticated competition trying to catch up to you.