( FORMER CHIEF ECONOMIST, BENGAL CHAMBER OF COMMERCE AND INDUSTRY)
KOLKATA, 25 JULY 2022
If you are a classic music admirer, you must have heard Jugalbandi. Jugalbandi between sitar and sarod. Jugalbandi between flute and sitar. Jugalbandi is fusion music . An organic blend of music which creates a new genre while retaining the purity of individual instruments. For a startup, the most important critical factor is product market fit. Will the product or service you have planned to market satisfy the marketplace? Will your product generate excitement, engagement and power to retain customers over the long run.
Will there be word to mouth spread? Will your product or service turn into a talk of the town blitz. A Simple way to know whether your product has passed the market fit is to observe a few metrics. You have downloaded your product in the market, you have spent money on advertising, mounted marketing campaigns , but what is happening?
Is the customer returning the call, is the sales cycle becoming short, is the media running after you?
These metrics are available to assess the product market fitness. Depending on the type of product or service a range of metrics are available like number of signups, rate of conversions and monthly recurring revenue. Is there any method available prior to launch? Any tool to test the concept? Any tool to assess the minimum viability of the product ? Indeed techniques are available. The high points of these techniques are customer interviews to identify the pain points and the solutionyou would like to provide. Is it in the positive loop?
Second, you also need a customer survey. This is required to statistically validate the results available from the interviews. Third, you could also use the internet and the web to test your idea. You could create a website displaying how your product is solving a particular problem. You could generate messages and watch how many replies you have received , capture their email and start talking to them.
Similarly, you could post a video about your product and watch your success rate. How many leads are coming and what is the cost of lead ? Another major task to test product market fit is to look at the target customer. Are you targeting a wide market or a narrow market?
If your choice is narrow, your customer focus is sharp. Then you have a host of advantages. You can create a story around the pain points and show how your product provides a ready solution. Moreover, once you are narrow focused, you can go into minute detail, add multiple features to your product. Consequently, you would be able to create a differential value to your product or service and be a
Once the process of product market jugalbandi is frozen, you can further test and develop a minimum viable product which will delight the customer. To ensure success of your startup, product market test is necessary but not sufficient. The entire exercise, truly speaking, is to develop clarity so that you can devise a business model which ensures the desired rate of return for the project in question.