When you become an entrepreneur, it’s usually because you’ve fallen in love with an idea. They believe ‘this will work’ so much that you will likely bet your life savings on the idea and your ability to make it happen.

It is a difficult decision and we all often encounter more examples of failure than success, which makes it harder to go down that road. For example, when I started my business – I kept failing. But every time I failed, I’ve learned something, and that “learning” helped me build a $ 250,000 business.

I want to share these insights and practical experiences that will help solve complex business problems, achieve sustainability, and ensure growth.

Essential for a product evaluation

When you create a product, you need to determine the essence of your product and its function.

Every product is based on solving market problems that your competitors couldn’t solve, and your product is a better and more efficient solution to that problem. So the one problem that the product solves should be the core, and the rest of the solutions should be the feature of your product.

You will often see products that solve many smaller problems and bring them together into one core offering. It’s a different way to build a core, but the first way is considered to be much more efficient and sustainable.

Understand the product-market relationship

When you offer a product to the market, analyze its strengths and weaknesses from a market perspective or, to put it simply, from the perspective of the target group. If the product uniquely fits into the puzzle of your market need, then you have reached the state of nirvana ‘Product market fit.‘It is the degree to which a product meets strong market demand.

Now you may have the following questions – how do you rate your product? And how do you achieve a product market fit?

How do you rate your product?

Assessing your product market fit is not a simple yes or no answer; it’s an elaborate, open-ended question. First of all, you need to analyze and understand to what extent your product meets the market needs or how efficient your product is for the market?

To determine the answer, we have two theories – Kunal Shah’s Delta-4 theory and the 10X rule.

Kunal Shah’s Delta-4 theory

When evaluating the product, you should consider three aspects:

1. quality of the product

2. speed Access to your product

3. costs to use the product

If you get a 4 point difference in the marketplace on any of these three aspects, you have created irreversible change for your audience. It means that people are no longer resorting to the old methods / products and it will stay with you for a long time, at least until someone else makes a 4 point difference.

You can measure the difference through market research, talk to your users, and collect surveys. For example, if the average rating for your product is 4 points higher than the current product, you have achieved a Product-Market-Fit.

The 10X rule

When you bring a product in the market, you create a core value proposition ten times better than the previous version. If you succeed in this 10x better model, the product will support the market and redefine the market itself.

Before you can determine if your product is a 10X, you need to determine the metrics that will be used to rate your product. These metrics are unique to each market and the products currently available in the market. But three broad categorizations can help you with this process –

• Usage: The actions your customers take to show they want to buy the product
• Activation: The point at which a customer first pulls real value out of the product.
• Engagement: The extent to which a customer continues to gain value from the product

Much of your product and its marketability are specific to the market sector you are in, but the bigger picture will give you direction to go one step further.

Why do you need a product market fit?

To achieve a product-market fit, measure how your product fits in the market and give you an insight into what you need to do to make it more effective and efficient for the market.

When you reach or start moving towards a product market fit, your life becomes much more manageable. You will quickly acquire customers; Not only will you attract paying users, but you will also support investors. It is like reaching “nirvana”.

When your product speaks for itself, you get more referrals, more customer loyalty, and most importantly, the return on investment is much higher than the cost of capital.

The bottom line

Most of us think that reaching a product market fit is like reaching and exceeding a level. But on the contrary, it is a process. You need to keep working on solving the right problems and always being relevant in the market.

It’s a constant journey of approach, risk-taking, and development. Yes, development! Remember, your audience is evolving every day, their demands are growing and your product has to match their development and fulfill their wishes. This is the only way to become relevant and to retain the customers you have won through the journey.

Being an entrepreneur is not limited to delivering what your audience needs today, it sees the future and invests in the ideas that will solve tomorrow’s problems.