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Is there a market for your product idea?

Date: Oct 29 2018
Is there a market for your product idea?

So you think you have come up with the latest must-have product. But who will want to buy it and how much will they be willing to pay?

It’s one of the most crucial steps in any start-up’s journey – validating that there will be sufficient demand, and at the right price, for a new product.

But how do you begin to figure out exactly how big a market there really is, to ensure it is a business idea worth pursuing and one that may attract seed investment?

Conducting marketing research

Firstly, you need to define your target market. If you haven’t already done so, then make sure you think about who your end user is likely to be. At this stage, you may need to rely on making some educated assumptions, which you can then tweak and enhance as your market research progresses.

Friends, family and colleagues will typically be the first participants in any start-up’s market research. They are free, accessible, and often very enthusiastic. These groups are often the first source of feedback that a start-up entrepreneur receives about their product idea and can end up shaping the direction that early prototypes take.

But feedback gathered from these participants should be treated with caution, as they are likely to err on the more positive side and to shy away from spilling any cold hard truths. They may also not be your end target market, or likely early adopters of the new product.

What is really needed is a robust test for market demand, if you are to move your product idea forward – especially if you’re planning to give up the day job in the process.

Unless you have sufficient cash reserves to self-fund your market research, then you are going to have to roll your sleeves up, get out there and start talking to your target users. If you have the budget, then focus groups are a popular method for gathering qualitative data from a target market.  However, when bootstrapping your market research, you need to be a little more creative with your methods.

5 top tips for validating a market without breaking the bank:

  1. Grab a clipboard: You can’t beat face-to-face interaction with your target market. Bring a sample, make a simple questionnaire and start talking to your target users.
  2. Piggyback on existing groups: You may find that your target users already have groups of their own, such as online forums, physical support groups or more informal get togethers in coffee shops or hobbyist events. Tap into these networks and groups.  Get friendly with the organisers and use their members as early sounding boards.
  3. Product crowdfund: Provided you can get your prototype to the point that it can be filmed in use, then consider creating a teaser video and using a product crowdfunding platform such as Kickstarter, Seedrs or GoFundMe to get interest from your early adopters. The benefit here is that you are asking people to part with their money, and so the validation achieved at this stage is hugely indicative of what you can expect if you go out to the wider market.  Also, users of product crowdfunding sites are typically very engaged, early adopters and willing to give honest feedback.
  4. Talk to a wholesaler: Most product sectors utilise the services of intermediaries of one sort or another, be it wholesalers, rep groups, or distributors. These intermediaries are often sector specialists and will have their ear to the ground. They’ll know what products are launching in the next 12 months, and at what price points, and could give you some valuable insights into the likely demand you can expect.  Who knows, you may even get an order, or letter of intent from one of them!
  5. Go to a trade show: It’s a tried and tested part of the marketing toolkit and can quickly immerse you in your particular market sector, helping you not only identify competitors but also validate price points, packaging expectations and marketing collateral that you may need to launch. It also presents an opportunity to talk with wholesalers and distributors who will typically be exhibiting there, to get some early indications of interest from them.  You can often attend trade shows as a visitor for free, or for a small fee, to avoid the hefty cost of being an exhibitor yourself.

What should I do about protecting my intellectual property (IP)?

A word of caution here, before you go out into the big wide world talking about your new product idea. What steps have you taken to adequately protect your idea and the intellectual property you have created?

Much of this will come down to whether your product can be patented, or have its designs registered.  If so, then you should take steps to protect what you have developed before talking to anybody.  You can utilise Non-Disclosure Agreements for a few initial conversations, but realistically this will hold up your research and it’s much better to put some initial protection in place first.

There are some fantastic resources available for start-ups that cannot afford to immediately engage the services of a patent attorney. For example, at the British Design Fund we have a partnership with ACID – Anti Copying In Design.  ACID is a not-for-profit trade association that offers its members advice and guidance on safeguarding their designs and intellectual property.

The British Library also offers free 1 hour IP clinics for start-ups looking to get some advice on how to commercially protect their ideas.

Got an interesting product?

If you have a well-designed product that fulfils a distinct need, or solves an important problem, then get in touch.  Applications for funding available through the latest British Design Fund are now open, and can be submitted here, or for more information email us using enquiries@britishdesignfund.co.uk.

If you are interested in learning more about how you can invest in future British Design Funds, then please email us using enquiries@britishdesignfund.co.uk

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