Will my product sell?
I have been engaged in a email exchange with a young entrepreneur over the past couple of weeks. I met him at the C100 Accelerate TO event. Like any good CEO, he was trying to get exposure for his company by pitching it to senior execs and investors in attendance. I gave him some coaching which he followed up with an email. He recently pitched a new product concept by email and asked for my opinion. After responding, I thought it may be valuable to others so here it is:
"I am not sure it matters whether I like your solution or not, since I am probably not your target market and may not have the perspective to assess the viability. Here are some questions you should be asking yourself that may help you answer the question of product viability.
- What business problem are you solving for?
- How big a pain is it? What will people pay to solve this pain?
- Are you selling a product that is analogous to a "Vitamin" or "Medicine"? People will pay more for medicines when they are sick and will have more urgency to buy.
- How big a market is this? Is it a pandemic, a common cold or a rare disease?
- Who gains the benefit, who has to do work to get the benefit, and who has to pay for the cost in order to get the benefit? Are these aligned? I have seen situations where there is benefit to the senior management and they have to approve the cost so these are aligned. But, the workload has to be borne by the employees who get no benefit, so they avoid doing the extra work and the system fails. The classic example is sales forecasting systems. The benefit is better sales forecasting for management. The cost is a productivity hit to sales people who have to do all the extra work of data entry for no benefit so they resist or only enter the minimal data.
- If you are using partners as a channel sales strategy, you must answer the question: "What is in it for them?". For them to take on a distraction of partnering with you, they have to see a net benefit that is critical to meeting their goals and that they may not be able to obtain without you.
You also need to be careful in not creating a chameleon company. I understand you have a flexible platform but if you develop different solutions for different business problems, you risk confusing the market and particularly investors, about what you are doing. You also risk looking like you have a solution looking for a problem."