Three Critical Questions for Entrepreneurs

By | Small Business

Whether you’re a consultant, an app creator, starting a store, or creating a physical product company, you are providing a solution to a problem.  On one hand, if there is no problem, then nobody needs a solution and you don’t have a product. On the other, if everyone has a problem you can solve, you have a great position to start from.

Entrepreneurs have to ask themselves these three simple questions:

  1. Is there real problem shared by a lot of people?
  2. Is there an urgent need to find a solution?
  3. Does your product offer a compelling solution to the problem?

On question one: you are not your customer; only your customer is your customer.  If no one else but you has the problem you’re trying to solve, you don’t have a product to build a business around. I’ve tried to mentor early stage entrepreneurs on this point, but I’ve found that many are so convinced that the problem their product is designed to solve is so prevalent that they don’t really have to find out if anyone else has the problem. They just assume there’s a huge pool of people just awaiting the arrival of the solution. You don’t know if have a market until you find out.

On question two: If there’s no urgency (degree of both frequency and intensity together), then a customer’s motivation to buy is low and sales might be tough, even if your target customer knows they have a problem. Making something that’s hard to sell isn’t smart. Urgency is a very important test to determine a) how motivated people are to purchase a solution, and b) how big the target market is. If you find that there are a LOT of people with the problem and they have a high degree of urgency to finding a solution, then you’ve really got something. If few people have the problem or there’s not enough urgency to create a motivated customer, you may have a serious obstacle to success.

On question three: You may find a wide spread problem and discovered there’s a sense of urgency to find a solution, but your product might suck.  Or maybe a competitor does it better, offering a higher degree of value perception. Unless your product offers a compelling value – one that creates a benefit perception that is much higher than the cost perception – you may have a problem selling it.

The only way to answer these questions is to ask potential customers, a lot of them. No matter how much you believe in your concept, it doesn’t matter unless other people do, too.  It’s called customer investigation and is a critical prerequisite for starting a successful business.

This article was syndicated from Business 2 Community: Three Critical Questions for Entrepreneurs

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