Here are 5 simple ways to find out:
An entrepreneur will always be thinking of new ideas and improving on existing ones.
Eventually, you are going to land on that one idea that is, quite simply, extraordinary. Before you spring into action take some time to check out these 5 points which will give you a good indication of how successful that idea is likely to be.
On the face of it, competition can be off-putting but think of it this way; if there are a lot of people competing in the market there must be a lot of potential and opportunity.
The fact that there is already activity in this particular segment of the market gives you the ability to conduct research and look at how successful the competition is, what their strengths and their weaknesses are and which areas need work.
Basically, you can look at their journey and learn from it to give your product the edge.
If there is a stand-out problem that no one is tackling you should be asking yourself why. Is it that there is not much opportunity there?
You can easily answer that question by looking into whether users are making solutions for themselves. If they are, these people could well be your customers later.
Contact them and ask them what they need, conduct some interviews and make sure that what you offer goes a long way towards meeting those needs.
Is your new idea going to be something that your target buyer needs? More to the point, is it a 'must-have'? It is vital to make sure that your idea will solve a problem or need if users are to become your future clients.
Take some time to do your research – ask people if they are likely to spend money on your app or product, and how often they spend on similar products.
Sometimes you may see a solution already being used – can you improve on that? Will your idea make it more cost-effective and user-friendly?
Even if your product is much-needed and has been identified as such by users in the market place, this doesn’t necessarily mean that the buyers will stop using an existing solution that they are already familiar with.
You must make sure your product offers benefits that will grab their attention and make them want to change.
Adding features is one way to do this but you don’t necessarily need to go down this route. If you find there is a segment of the market that is under-served or has a specific set of needs, you could choose to target your product there.
Once you have established yourself in this segment you always have the option to expand into multiple areas of the market, using the first one as a way to validate your product to other potential customers.
Timing is everything. A well-research, well-produced, marketed and financed product is only part of the story. Hitting the market at the right time is the single greatest determining factor for success.
In fact, according to Bill Gross, an investor, and entrepreneur, timing makes up 42% of all the factors that make the difference between whether a startup succeeds or fails.
Even if all of the top 4 questions are covered, if you don’t have the money to turn the idea into a product your venture will fail. How will you raise the funds?
Will you be able to make a full-time commitment to this business? If you can’t do this, can you work part-time and still afford to fund it?
Again, research is the key. Knowing exactly how much you will need to keep the business going for the first two years means you can work on raising that money.
During these early years, the focus of the business will be on marketing and development so you need to make sure you account for more than just the cost of getting your product on the marketplace.
You must raise funds that will take you past the launch stage and be able to comfortably invest in developing several iterations of the product. This is the case whether you are customer-funded or funding the business yourself.
These are only the basic 5 checks and, of course, there are more. For example, you will need to look at market size, the solution itself, your background and how regulated the market is.
It may not be possible to check all the boxes but having a good knowledge base before you start will make success more likely.
You need to be flexible enough to look at what comes from the research you have done and respond appropriately. Does the product need to change to meet an identified customer need?
Having the funds to start means you can start to gain traction and then encourage further investment.
The key takeaway is flexibility. Do your research but always stay open to changing your product in the light of research and identify customer needs.
Use your funding to encourage investment and business partners to keep the project moving forward.