How To Validate Your Business Idea In 5 Steps
In this post, I’m gonna share how you can validate your business idea or product idea with the 5 steps I always take to validate any new course idea or product idea.
This month, I was chatting with a friend of mine who is also an online entrepreneur. I wanted to validate a business idea to create an online course about turning your services into an infoproduct, and decided to validate this idea with a joint-challenge.
The validation was a success.
In just a few hours, we sold 10 tickets to a 2 hour masterclass on creating, launching, and marketing an infoproduct (that didn’t exist yet), and generated $300 in revenue with a quick landing page that was created in less than half an hour.
So what are the 5 steps to validating a business idea?
#1. Choose Something That You Have A Real Passion In
First, choose your business idea wisely. Maybe you have an idea right now but you aren’t sure if it is worth going ahead with. The fact is, not all of your ideas will be great business ideas. I wish I could say that all of my ideas were million-dollar idea, but honestly most of my ideas are dumb.
The best business ideas are ones that you have a true interest in. Something that you can talk about for hours at a Christmas dinner is a good indicator of your level of interest in this topic. I personally only build a business around something that I actually enjoy because I’ve launched products that I’ve no interest in and they never turn out well (I get bored or burnt out because I was doing something I did not enjoy).
For example, I could talk about running an online business, entrepreneurship, and marketing FOR HOURS (just ask my partner), so naturally that has become my business.
Another way to test if you have a true passion about this topic is to see if you could actually write a 1,000 word article about this topic, and a list of 10 – 20 possible article ideas around this topic, and actually ENJOY doing so. Sure, maybe you can churn out 20 different 1,000 words on scented candles, but would you actually enjoy sharing and writing about this topic?
#2. Get Feedback From Your Target Audience
Once you’ve decided on a business idea, you’ll want to get early feedback from your target audience. Note that I said “target audience”, not just any random friend or supportive family member who is not your target audience.
You’ll want to reach out to closest connections first. Again, those you reach out to have to be in your target audience, so no mom or dad unless they are your actual target audience.
In this instance, I would only reach out to friends who are current business owners offering services. For example, I have a friend who is a relationship therapist who would benefit from learning how to turn her knowledge and services into a digital product.
When you’re reaching out in social groups and forums, don’t become that spammy person that everyone hates. The goal is to start a conversation and get feedback, and not to sell to anyone yet.
You’ll want to post an open-ended, genuine question without a link to your landing page, a form, or asking people to do something other than commenting.
#3. Analyse Feedback To Create A Better Product Than The Existing Solutions
After gathering all these feedback, you’ll want to pull out insightful comments that will ensure that your product has a competitive advantage over existing solutions.
What do your target audience really think about your product or business idea? What did they like? What did they not like? What could be improved?
#4. Create A Quick Landing Page That Accepts Payment Or Email Subscribes
The quick landing page that we put up for our validation. Notice how we did not spend too much time on the design.
After getting feedback and analzying the feedback, it is time to quickly put up a landing page that accepts payments or email subscribes. I want to caveat here that I always recommend pre-selling over email subscribers, because nothing validates a business idea or a product idea faster than people opening up their wallets for you.
There are multiple ways that you can create a landing page, but I use ClickFunnels to create most of my business idea validation landing pages. So far, it is the fastest and easiest way for me to quickly put up a professional-looking landing page, versus getting my developer involved.
Remember, at the business idea validation stage, you don’t want to spend time building a full website, creating the actual product, creating an app, designing beautiful images, and all that. You’ll want to move as quickly as possible and at the lowest cost possible.
That said, don’t just create a “Coming Soon” landing page to collect emails. You won’t learn anything about those email subscribers, except for the fact that they liked the sentence or two you wrote. Plus you wouldn’t know exactly what they’re looking for, or even the reason why they need the product.
You’ll also need to decide on a price point that helps you to achieve proof of concept goal. You need to remember that at this stage, your goal is not to make a ton of money, but rather to validate your business idea.
#5. Time To Evaluate Your Validation!
The final stage of this is to evaluate the outcome of your validation. If you’ve reached your predetermined number of sales or email subscribers, than congrats! The real work now begins.
But if you did not get the results you wanted, it is time to digest all of the feedback you’ve received determine the possible reasons why not many people wanted the product.
I hope you found that 5 steps on validating your business idea valuable. I’ve also got a free 4-day email course that has more information about validating your business idea.
Do you have a business idea or product idea that you’re thinking about but unsure of launching? Will you be validating the idea with the 5 steps mentioned? Let me know in the comments section below.
Chrys was bitten by the entrepreneurial bug at an early age. By age 27, Chrys has started and ran two online businesses. Chrys now runs Chrys Media, a company that runs online conferences for online entrepreneurs.