If you are thinking about how to start a business, there are two ways. The first and the correct way is to find out whether people need a product and how much they are willing to pay for it. The second and dubious way is to develop a product, launch sales and hope that someone buys it.
Obviously, the first method to set up a company involves a substantial investment of your time. But it’s better to do this before you invest even a dollar in your project, so that later you don’t suffer because of money spent, wasted time and unfulfilled ambitions.
The Three Easiest Questions
Asking yourself these questions can save your business from failure. This fast way of testing ideas will help you quickly understand whether you are on the right track or not. Just ask yourself:
- What problem does my idea solve? (If your business does not solve a problem, nobody needs it)
- What is unique about my idea? (What sets you apart from hundreds of people like you in the market)
- Am I ready to give up everything and work for the good of my idea? (This is important. If you are not fully committed, then the plan isn’t for you)
How to Test a Business Idea at Low Cost – Practical Steps
The best way to test how effective a business idea is to follow the Kickstarter model. At the initial stage, you don’t have to think about how to make a business plan. Even more, you do not need a team, office, company registration, taxes, and millions of other costly difficulties to start a small business and sell before launch. You need to first sell your product, then release it. You have to be consistent and remove one risk after another.
Find an Audience Interested in the Product
The biggest risk when you want to start an eсommerce business is the demand for the product. If people don’t need it, or if the market is already full of similar offers, and you didn’t think of anything to stand out, you will waste time and money on development.
If you want to start an online shop, ask yourself: who will buy your product? Your main audience can consist of housewives, students, parents or a combination of groups. At the initial stage of the study, the number of audiences can be large – gradually, unprofitable groups will be screened out by themselves.
However, it is important to hit the target at least once, because in the future you will create targeted advertising for the most profitable groups of users. In fact, you are not testing the product itself, but how people relate to it. If you make a mistake with the audience, you will risk each sale of a product, and the test results will be incorrect.
In order to find out how to sell your product and whether it is in demand, you will need a landing page and advertising campaign.
Create a Promo Page to Run a Small Business
The idea to create a landing page for a product or service that doesn’t yet exist is taken from Eric Rice's classic work The Lean Startup. In it, he talks about how to check the viability of ideas.
The author doubts and checks every emerging idea. Testing an idea, in his opinion, shows not only how much the audience is interested in your product, but also whether they are willing to pay as much for it as you plan. You need to make a successful business, so remember that the customer is not just the one who is interested in your product, but the one who pays for it. Therefore, when you make a business website, you simultaneously test the seriousness of the intentions of potential customers.
The interesting thing is that customers of any online store see only photos, specifications, and reviews. They do not know for sure whether you have a product or not. So why not let them assume that you have it without investing a dime in it?
Therefore, before selling a finished product, you need to make the simplest landing page. On the landing page, you just need to describe the product and put a “Buy” button. This method will help you determine how many people are willing to pay for your product.
For a clearer picture, you can make several landing page options, changing the cost and main features of your product or service. Only once you process the analytics will it be wise to create a prototype. The author of the methodology calls this principle: "First ask – then do it.”
Easy Steps to Create a Test Landing Page
- Select a site builder. You can safely choose cheap or even free site builders. You can create the basic functionality of the landing page without even paying a dime.
- Landing page creation. Follow the intuitive instructions for creating and designing blocks. Enrich your page with unique content and photos.
- Give detailed contact information. The more ways to contact you, the better. Indicate phone number, email and social media links as well as working hours.
- Connect widgets. Connect the widgets "Online Consultant" or "Callback" to the page. With their help, you can increase the number of applications from potential customers. Usually, site designers already have ready-made widgets for pages.
- Sell your business with targeted ads. The Google AdWords test ad campaign is needed to quickly get traffic to your landing page. If you know that your audience is quite active on social networks, it also makes sense to run ads on Facebook or Instagram.
- Analyze the indicators. If the page continues to be quiet, then either you have configured the advertisement incorrectly, or there is no demand for this product or service. If the goods are not available, you can tell customers that the next delivery will be after some time, and write their data to the “waiting list”.
But how can you start an online business if you have no goods but already have orders for them? It’s as easy as pie. You can arrange delivery of the order through intermediaries. And if they refused, you simply note for yourself that there is demand and the availability of goods for immediate purchase is important for this market.
If during testing you receive applications from customers, you can order goods and begin to provide services. If there were no calls and requests, then most likely there is no demand for this product or service and it is not worth starting a business. It may be worth looking for an audience in other places such as social networks, instant messengers or offline events.
If you already have a ready-made (and preferably tested) business idea, share it with us and we can implement it for you.