What is Product Market Fit and Why Should you go through this process before starting a business?

In the recent years there are so many businesses started that, the number of businesses started in a particular year are more than the total number of businesses in the history of the world.

The business world has become complicated and so has the world. Economies are changing, people’s habits are changing. Countries like China and India are growing at a rapid pace, and a lot of middle class is moving to a higher middle class and so on.

Normal people don’t keep up with these changes and aren’t really aware of the different classes in society. As an Entrepreneur, you should.

A product market fit is when you figure out that the product or business that you are creating has a validated market around it. In simple terms, a lot of people are willing to pay money to use your product or service.

Why is this important?

It’s extremely important to go through this process because you don’t want to be building something that people are not going to buy. Just because you build something, it doesn’t mean people are going to buy it.

So how do you get to product market fit?

• Use the Google Keyword tool to find out what people are searching for and search for keywords in your space. If there are a lot of searches, then you get an idea of whether there’s demand for it.
• Test your product with over 100 users and see if you are able to form patterns around how people are reacting. Ask them the following
  • Do they understand your product’ benefits?
  • Will they make a purchase?
  • Will they tell their friends?
• Create a landing page and drive traffic to it and see if people are purchasing or transacting. Are people converting or are they dropping off? This will give you an idea of whether your product is needed or not.
• Go to dedicated forums for entrepreneurs, app developers and ask people for feedback and their honest opinion. Ask them how you can improve the service and if they add value to it.
• Create mockups of your web app or mobile app to show it to people and run it by them and see if they find value in it.

As an entrepreneur it is a must to attain product market fit before you build a product, hire a team, spend money on marketing or raise money.