Test Your Ideas and Potential Demand – Make The First Sale Early!

This is a guest post by Dr Mark Simon. Mark is a Professor of Entrepreneurship at Oakland University where he teaches undergraduates, MBAs and Executive MBAs. He also has a lot of practical experience and have started many businesses.

It’s very easy for an entrepreneur to come up with an idea for a product or service and become excited about the “possibility” of making large volumes of sales.  However, this excitement often translates to overestimation of desire for that product.

Sure – You understand your own idea and may be able to see potential value in it for other consumers.  But do your consumers see it?  Do they recognize the value in your product the way you expect them to?

One of the best methods to test the perception of your product in a given market segment is to attempt to make some early sales before making a massive investment on marketing.  This can be accomplished via several approaches, though two popular means are direct contact and internet exposure:

Direct Contact – Personally contact individuals or companies that fit your target market and attempt to sell your product.  You can quickly gain reliable information about the market’s reaction and may discover consumer objections and questions that you weren’t originally expecting.

Internet – Thanks to the simplicity of online auction sites, such as eBay, you can quickly list your product and see if it is well-received (or even noticed) by consumers.  If you’re a little more internet savvy, you may want to consider setting up a very basic website that focuses on selling your product and see what kind and how many orders it generates.  You can also use Google Adwords – a friendly pay-per-click advertising service – to draw attention to your site through online advertisements that are linked with specific keywords you are interested in testing.

You may be tempted to hire other individuals to attempt the actual selling process, but it’s very important that YOU, personally, do the selling.

Why do YOU, as the entrepreneur, need to be the person doing the selling?  For a few key reasons:

  1. You understand your product better than anyone else.  If potential demand exists for your product, you have a higher likelihood of finding interested customers if the product is presented by the individual most knowledgeable about its uses and benefits – which is YOU.
  2. Hiring other people to sell your product may result in disappointing but misleading results.  Assume you have an employee attempting to sell your product and he/she has difficulties finding interest among consumers.  Were potential prospects really not interested?  Or did the employee fail to deliver a good presentation of the product?  You’ll never know for sure, because you weren’t there and you couldn’t rely on your own perceptions!
  3. As you find interested buyers while selling your own product, you gain credibility.  You may be pressed by prospects for evidence that your product is desirable and valuable to its target market.  Your own testimony will appear far more credible if you’ve personally sold your product to other individuals or companies.  When asked if “people are buying,” being able to list examples of customers will be far more effective than merely giving vague, yet optimistic expectations for demand.

Therefore, when attempting to gauge consumer’s desire and appreciation for your product, try to make some early sales and analyze your target market’s reaction.  You can use both online and offline methods of selling your product or service; however, make sure that YOU personally conduct the selling process.

For more information on testing and analyzing start-up ideas, you can read “The Balanced Entrepreneur” and visit my blog:  http://www.thebalancedentrepreneur.com/Mark_Simon_Blog

Dr. Mark Simon, Ph.D.

www.TheBalancedEntrepreneur.com

 

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