The Road to a $100M Company Doesn’t Start with Product — Brian Balfour

To expand into these concentric layers, the product typically needs to change to maintain the strength of market product fit. 

Sometimes moving into these segments of a target audience are an iteration. Other times, they require much bigger changes. Understanding how big of a change is required starts with a deep understanding of the audience’s problems and motivations. 

2. THE MARKET EVOLVES

At the same time, markets don’t sit still. That means the markets with which you have strong Market Product Fit will evolve over time. 

For example, think about the shift from web to mobile. Facebook was one of the companies who successfully made the tough transition. Sheryl Sandberg has said that to do this, the company didn’t ship new features for a whole year just to make sure they nailed this market transition.

Signals Of Market Product Fit

If Market Product Fit isn’t binary, then how do you know if you have Market Product Fit? There has been a decent amount written about this, but most of it doesn’t reflect reality. 

With almost everything, you need to combine qualitative measurements with quantitative measurements with your own intuition. We trick ourselves when we only look at one of these areas. It’s a lot like trying to get a full picture of an object with only a one dimensional view. 

How do we combine qualitative, quantitative and intuition indicators to understand how strong of Market Product Fit we have?

1. QUALITATIVE

The typical starting point with measuring Market Product Fit are qualitative indicators because they are the easiest to deploy and require the least amount of customers and data. 

To get a qualitative understanding, my preference is to use Net Promoter Score (NPS). If you are truly solving the audience’s problem, then they should be willing to recommend your product to a friend. 

The biggest downside with qualitative information (vs quantitative) is that it carries a higher probability for generating a false positive result, so take it with a grain of salt. 

2. QUANTITATIVE

There are two quantitative measures to understand Market Product Fit: Retention Curves and Direct Traffic. 

In 2013 I first spoke about how flat Retention Curves indicate Market Product Fit. So I won’t rehash those points here.





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