From time to time we get a call from a prospective client who has a bright idea about a product or service they want to launch and wants to know how we can help.
Very often these people are extremely enthusiastic about their idea. Absolutely nothing wrong with that. In fact they will probably not succeed without a great deal of passion for their product. However, therein lies a potential problem. They can be so close to their idea that they will convince themselves there is a huge market out there clamouring for their product or service. They will use extremely well-thought out arguments and refer to renowned success stories to explain to me (sometimes to the point of browbeating) why their idea should succeed. But I’m not the one who needs convincing!
In a recent survey of more than 100 entrepreneurs of failed start-ups carried out by CB Insights, they found that the number one reason for failure, given by 42% of polled start-ups, was the lack of a market need for their product.
Fairly obvious. If no one wants your product or service, your company isn’t going to succeed but many start-ups build things people don’t want with the irrational hope that they’ll convince them otherwise.
Now I know that dissenters of market research will hold up the late (and great) Steve Jobs as an excuse NOT to do market research. He famously claimed that “people don’t know what they want until you show it to them” when talking about the mobile phone. The problem is that for every successful billion £ company that started with a bright idea, there are numerous, seemingly great products that never take off.
Which is where the need to temper enthusiasm with real data and insights comes in.
Yes market research may appear to be time consuming and an unnecessary expense but not as much as rolling out a product or service to an untested market…..