How To Achieve Product-Market Fit
Ways to discover customer pain and build ideal customer profile early on
The joy of building products! It’s emotional because what started as an idea is now taking shape in reality. Like young blood, you feel an inevitable rush the entire time. A kick to make things happen, to hustle. It’s what fuels you and the others who share your quest to solve problems that bothered the world.
So, the question is — What bothers the world? It’s the struggle to avoid, reduce or eliminate pain.
Your product can only survive as a vaccine for that pain. It’s the only reason you exist.
The art of identifying pain and stopping it from happening is how you realize product-market fit. Whether you wish to be prescribed or be available over the counter, that’s on you.
So, let’s talk about how you attain product-market fit.
How to surf the market for opportunities?
To discover what hurts the most, get closer to the ones you’re in this business for — your ideal customers. Start by asking yourself the following questions:
- Who are these people who need your help?
- What problem do you solve for these people?
- How are they solving this problem right now?
- Why should these people care about what you’re offering?
- Where do these people hang out?
- What things do these people connect with emotionally?
Now, the purpose of these questions is to offer you a visual image of a person, group, or company that can benefit from what you’re offering as value. You need to have enough details about this person to sketch a portrait literally. Yes, demographics are important.
Blueprint to define your value proposition
- Think of one or a maximum of two things that you will either eliminate or amplify in the lives of the people you want to help.
- Chalk out a list of tools/activities that your potential customers use to relieve their pain right now. This exercise will bring you closer to their pain and their struggles.
- Understand how big the problem is which you’re trying to solve. — Ask why anyone would need your help? Is the problem big enough to become a deficiency in the future?
Know what you bring to the table for them and how you’ll add value.
How to read the behavior of your ideal customer?
Invest in knowing how these people network, from where they source their wisdom, and other places or people influence their decision-making.
The best way to answer these questions is to learn about their aspirations, understand what motivates them to show up for work and how they would like to be remembered.
How to understand problem-market fit?
To illustrate an example, let’s talk about Couchsurfing, a community of travelers worldwide.
Interestingly in 1999, Casey Fenton, a shy student, decided to travel to Iceland on a budget. He pulled out his college directory and emailed more than 1500 students, folks who lived in Iceland, to make this happen. Hitting them with one question — would you let me crash at your couch?
The response was overwhelming. It was that moment when Casey incepted the idea of Couchsurfing.
So, how does Couchsurfing realized its product-market fit? To understand, let’s break it into the questions which I discussed a while ago.
Founder in 2004, Couchsurfing realized that:
Their Ideal Customer Profiles are Backpackers, college or exchange students with internet literacy.
What problem they’re looking to solve? It is to travel for rich cultural experiences while minding the cost.
How is his audience solving this challenge right now? Maybe by emailing students like Casey did or asking people in their network to do the leg work for them
Where do these people hang out? Ideally, at college, international hostels, trip-advisor forums, cafes, and in the comment section of travel blogs and youtube videos.
What do they care about emotionally:? Human connection, learning new cultures, explore a different side of them, and saving cost.
Couchsurfing reached a million users in 2009. In 2011, they reached 3M users and raised $22M @ valuation of close to $150M.
In 2020, Couchsurfing had a staggering 15M users on the app.
Casey and his team realized product-market fit by first identifying their ideal customer and what value Couchsurfing adds to their lives. The validation startups tend to delay in the early days.
I recently ran a survey asking founders what they prioritize to attain product-market fit early. 44% said they prioritize building MVP. 44%! Only 11% said that they prioritize building ideal customer profiles, and about 7% said they prioritize sizing their market to attain product-market fit.
If we prioritize MVP before discovering our value proposition, then a startup failure rate of 50% in their first year is inoperable.
How to avoid the traps of bad product-market fit?
Peter Reinhardt, the founder of Segment, said —
“Be honest about whether you have a product-market fit or not. Because if you’re not confident, you don’t have a product-market fit.
You’re not one feature or one month away from achieving product-market fit, you either have it, or you don’t.”
He says this while emphasizing the role of pivoting your product or strategy based on the value proposition and understanding the problem-market fit. Defining the problem, the pain is critical.
The underlining thing here is that while product-market fit gives you the confidence to kickstart your engines. It doesn’t promise survival.
Insights into sizing your market, your competitors, and the way your customers make buying decisions can be invaluable to navigate out of tough times.
So, be wary of doing your due diligence on understanding the problem-market fit before going all-in.
Do share your thoughts on the subject of attaining product-market fit in the comment below.
