How hard is it to create a successful product? According to some studies, your chances of building a successful, revenue-generating product are only slightly better than your chances of being accepted to Harvard.
As a project or product leader, you’re ultimately responsible for building a great product. You need to do everything in your power to determine that you’re not only building in the most efficient and effective way possible, but also that you’re building the right product in the first place.
But how can you know for sure that you’re on the right path? (Without resorting to crystal balls and Tarot cards?)
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Validating new product ideas is one of the simplest ways to ensure you’re building something that users really need. The validation process allows you to get your ideas in front of real users early on and get a feel for how they’ll react to it.
Unfortunately, too many companies skip validation in the excitement of building something new. Yet unsurprisingly, focusing too much on what you’re going to build in the future takes away the chances of success for what you’re building today.
In this guide, we’ll show you how to find great product ideas, validate them with real users, and maximize your chances of product success from the beginning.
The importance of great product ideas (and where to find them)
In a world where everything is available at the click of a button, it takes a lot to stand out from the crowd. It’s not an exaggeration to say that for many organizations — especially tech companies — a fantastic product is the difference between life and death.
The most successful companies in the world create products that beat their competition by being innovative and customer-focused. Specifically, those products have a genuine market need, providing a way to solve problems or create new capabilities.
Take TikTok, for example. In a world saturated with social media, they made a new product to engage a younger generation of users in a fast, dynamic, and creative way. Even if you don’t use it, you have to admit that TikTok changed the social media landscape and forced massive incumbents like Instagram to scramble just to keep up.
Another great example is Apple’s AirPods. While wireless headphones were already an established product, users hated the design and opted for wired alternatives. Nowadays, AirPods are mainstream products, with 110 million pairs sold in 2020 alone.
But you’re not Apple or TikTok. So, how do these examples help you?
If you analyze them closely, both of these examples share the same critical elements of a great product. Here’s what we think separates a good product from a bad one:
|Good product ideas…||Bad product ideas…|
|Address a need. The best way to identify a great product is to fix a user's problem.||Add no value. Products that don’t help the user achieve something provide no value.|
|Have a story to tell, often providing context to the problem they solve||Confuse customers with their irrelevance.|
|Have a unique selling point (USP) that helps it stand out from the crowd of similar products.||Offer nothing new. There’s no point simply doing what someone else has already done.|
|Create positive emotional reactions from their users, be that happiness, excitement, or relief.||Are boring and unexciting for users, giving them no reason to engage with them.|
|Have profit potential for their organizations.||Have no commercial opportunity because users simply won’t pay for them.|
How to find great product ideas and develop “product sense”
Building great products starts with uncovering great product ideas. Luckily, “product sense” is something everyone can develop with time. If you’re looking to build your own TikTok or Airpods-level product, here are five ways you can start looking for innovative product ideas:
- Brainstorm within the team. The best place to start is to simply get together as a team and brainstorm some new ideas. Start by thinking about the pain points you have in life (relevant to a product theme) and go from there.
- Speak to your customers. Don’t be afraid to do the same with your customers. Simply asking them about their problems or what they’d like to do better/faster/more accurately may help you uncover a killer new product idea. For extra help, check out our guide to user research for product teams.
- Upsell & cross-sell. Take a look at your current products and see how you could create new spin-off products. For example, you could create a more premium upsell or a sideways cross-sell.
- Research upcoming trends. Keep up to date with current and future trends in your market to anticipate what’s coming next. Keeping your finger on the pulse is the best way to stay ahead of the competition and pick up on a killer idea before anyone else.
- Review old ideas. If this isn’t your first stab at coming up with new ideas, don’t forget to go back and review old ones. Look for hidden product idea treasure in your lessons learned or ideas from past sprint retrospectives. You and your company may be better positioned to kickstart an idea that wasn’t viable previously.
Over time, the best project or product managers develop a strong product sense capability. Product sense (also called product intuition or product judgment) is the aptitude to assess what makes a product great.
Product sense is a skill that takes time to build. As you cycle through more and more product ideas, you’ll develop an innate understanding of user pain points, how well your product can solve them, and the true profit-making potential of your product idea - skills that are critical to strategizing all stages of product development.
If you’re new to developing product ideas, here are some ways you can build your product sense muscles.
- Regularly talk to your customers. This is crucial as you need to get close to the customer to understand what they need. This is where empathy comes in to help you feel the pain that problem causes day-to-day.
- Observe customers using your product. If you’ve got an established product in place, take the time to observe how customers use what already exists. This will provide valuable insights into what works, what doesn’t work, and what’s missing.
- Reverse-engineer popular products. While you don’t want to copy other products, to develop product sense, reverse engineer popular products to uncover what makes them so great. Those little nuggets of information could help you move forward with your idea.
- Network with other product leaders. Become the apprentice of product sense masters by sharing knowledge and networking within the community. Ask experienced peers what they look for in good and bad product ideas.
- Balance data and opinion. When assessing a new product idea, balance off data and opinion to get a rounded view. Products need to be functional and spark positive emotional reactions, so consider both when assessing an idea.
Market validation: 6 steps to validate your new product idea
Finding great product ideas is only half the battle. Even if you have the world’s best product sense, it pays to push your ego aside and validate your ideas with real people. Whatever you do, don’t just jump into development.
Here’s a six-step process you can use to nail market validation and ensure your product idea is as good as you think it is.
1. Write down your goals, assumptions, and hypotheses
How can you sell an idea to your customers if you’re not clear on it yourself? Writing down the goals of your product is the first step in market validation. Be sure to also include any assumptions and hypotheses that underpin your product strategy to test those later on too.
How to do it: The easiest way to do this is to ask yourself a range of questions about your product. These could include:
- What is my product?
- Who are the users, and what assumptions have I made about them?
- What problem does my product solve for the user?
- Are there any dependencies on customers using my product?
- What differentiates my product from others on the market?
- What does my product need to be successful?
- How will my product generate revenue? What does it need to make a profit?
- How will I scale the product?
- How will the product be marketed?
Remember to use those around you to help answer these questions. It’s always good to have multiple perspectives to get rounded answers.
👀 What it looks like in action:
Sarah is the product owner of a CRM system called InsureManager, a tool specifically designed for insurance brokers. Sarah wants to launch a new sub-product that integrates with customers’ website forms to capture inquiries automatically and pull them into the CRM.
Sarah sits down with 3 other team members to brainstorm the goals, assumptions, and hypotheses of the product idea.
Everyone agrees it’s a great idea that saves users time and effort. This automation would separate them from competitors and could generate money as an add-on to the core product via a subscription fee.
2. Align the product idea with your business strategy
Great products are one of the single most important aspects of a successful business. But businesses don’t just sell any product. You need to ensure your idea aligns with the business strategy to get endorsement and support to take it forward.
How to do it: This step is all about stakeholder management. It’s time to pitch your idea to senior individuals in your business who will approve it and sponsor its creation.
There are many templates out there for crafting your pitch, but we like to use our own free Planio Product Strategy template. This one-page document helps you clearly present how your product aligns with the market, user needs, and business goals.
👀 What it looks like in action:
Sarah puts her idea onto a product vision board to show off the value, positioning, and potential. Sarah then presents the board to the Innovation Director, John.
John likes the product idea and agrees it aligns with the business strategy of ‘Automation by Default.’ John agrees to sponsor the new sub-product and provides Sarah with funding for initial market research and three months of a development team’s time.
3. Assess the size of the market opportunity
To take your product idea to the next level, you need to assess the size and opportunity of the market. Ultimately, this is where you’ll find out whether your product will survive commercially and its likelihood of making a profit.
How to do it: This stage is all about research. You’ll want to gather as much information as possible to determine the size and shape of the market.
To do this, dig into the competitor landscape, including the current market share distribution. As well as focusing on the present, look out for future trends in your sector to identify any upcoming changes that could help or hinder your products' success.
👀 What it looks like in action:
Sarah finds out that the Insurance CRM market is worth $500m in the US, with InsureManager only taking 8% of that share. She also finds data suggesting only 54% of insurance brokers use CRM systems, meaning there’s an opportunity for growth in the sector.
Sarah also chats with the Sales Director, Karen, to get her views on the commercial opportunity. Karen tells Sarah about an upcoming legal change that requires all insurance brokers to hold electronic records of customer inquiries.
4. Stress test the concept with real users
Now that you know you have a viable product, it’s time to validate the idea with real users. Whether you’re launching a completely new product or building on an existing one, you must confirm your users’ needs before committing any significant investment.
How to do it: There are a range of tools and techniques project and product management can use to get real-life customer feedback. Here are some examples:
- User interviews
- Focus groups
- Social media listening
- Customer feedback analysis
Whichever method you choose, it’s all about understanding the user’s pain points and validating that they think your product idea can solve them.
👀 What it looks like in action:
Sarah starts by interviewing several InsureManager’s super-user customers. She asks them about how they currently use the system, their problems with capturing client data, and how they feel about the new product idea.
Sarah also engages an external market research agency to help her validate the product idea in the wider market. The agency creates a survey that’s sent out to 2000 insurance brokers across the US.
General feedback is good, with many existing users complaining that manual data entry is a daily frustration. External survey responses also indicate that this feature could help potential customers comply with the upcoming legal changes.
Even if you have the world’s best product sense, it pays to push your ego aside and validate your ideas with real people.
5. Create prototypes, mockups, and concepts
It’s now time to bring the product to life by creating real, interactive prototypes and mockups. Here you want to take the product from being an idea to something that users can actually see and use. This helps further validate the concept of your product and its value.
How to do it: In the software world, this is where UI/UX wireframes, no/low-code prototypes, and test sites come in.
The key here is to create something that can simulate the product without investing a large amount of development time. Users need to interact with these prototypes to test the concept and validate it works in practice.
👀 What it looks like in action:
Sarah gets her development team to build a low-code prototype of the website forms sub-product. The UI developer focuses on creating a feature for users to connect the CRM to their websites.
Once created, Sarah and the team go back to their super-user network to test the concept. Users like the prototype, remarking how easy it is to set up and that the website data looks as expected in the CRM.
6. Build, test, and iterate your MVP
Congratulations! You’ve finished the bulk of your product validation, and it’s time to start your development. In the spirit of good agile project management, remember to iteratively build your product roadmap based on continual feedback from your users.
How to do it: As you move into your development, it’s essential to keep track of everything using a central agile project management tool. This is where tools like Planio can help, bringing task management, team chat, document storage, and sprint planning together all in one place.
To ensure you develop the best experience for your users, use techniques such as smoke tests, A/B testing, and usability testing to maximize your product’s value.
👀 What it looks like in action:
Sarah leads the development team forward as they create the first version of their sub-product. They decide to develop on two weekly sprint cycles, testing the new features with a sample of super users in product showcase sessions.
After four sprint cycles, they release the first version to the world, marketing it as a $4.99 per/month add-on to the core InsureManager product.
Don’t get stuck in these product validation black holes
The process of coming up with and validating new product ideas isn’t overly complicated. Yet, it’s still something that most product leaders struggle with.
Unfortunately, there are several reasons why you might be struggling to get your product ideas off the ground. As you go out there and come up with new ideas, try to recognize and avoid these common pitfalls:
- Fear of failure. People are scared to put their ideas out there as they’re afraid of criticism.
- No psychological safety. Linked to failure, many organizations don’t cultivate psychological safety, leaving employees to worry about the risk of punishment or humiliation.
- Lack of executive buy-in. Many great ideas fail to launch as they don’t have the right buy-in or sponsorship to push them forward.
- No compelling company vision. A good product is only as good as the company it lives in. If the company has no direction, it’s impossible for the product to thrive.
- Follower syndrome. In many ways, it’s easy to be the company that copies the competition. Organizations with that mindset are more concerned with keeping up than trying to set the pace themselves.
Ultimately, don’t be afraid to take a good idea forward. It’s much better for an idea to fail quickly than for you to invest energy in it behind the scenes, only for it to fail later on.
The bottom line: Validate before you build
Coming up with new ideas is easy, but creating a market-winning product is much harder.
Most products fail because they don’t fully validate their idea with their target audience, jumping straight into developing something that simply has no value.
Too many companies skip validation in the excitement of building something new.
As a project or product manager, you’re on the hook if your product doesn’t succeed. But like many things in project management, if you follow a simple market validation process, you can align your product, business, and customers behind a single idea.
Don’t make things harder on yourself. Use a project management and planning tool like Planio to keep all of your product ideas, progress, and knowledge in one place. Planio combines features for task tracking, knowledge management, and team chat to make it the perfect platform to set the foundation of a new product idea before the ‘real’ work begins.
Build better products today. Try Planio free for 30 days!