You’ve got a great business idea, so what now? Shell out on business cards, buy a load of equipment and spend thousands on your website, a graphic designer and inventory? Maybe you should spend some time to validate that business idea to see if it really is that great.
What is business idea validation?
Validating is a way of checking to make sure that your idea is a good one, or not as it may be. When validating your business idea or maybe just an aspect of your business like a logo or a new product, you are going through a methodical process. I’m sure you have processes for other aspects of your business or will do, so it makes sense to check if your idea could be a winner. If you were selling t-shirts, you would do some calculations and make sure you found a supplier that would sell you the t-shirts for a price that meant you could make a healthy profit.
If you don’t validate you are really just hoping that you’re doing the right thing without knowing for sure. By having a proper validation process you will not only increase your business’ chances of success but also give you the confidence that you’re on to a good thing.
If you don’t validate your business idea, you could spend hours and hours of your time and spend lots of your hard earned cash on an idea that is a dud. Don’t be that person.
If you’re reading this article, it’s probably because you’ve got a business idea, or three, that you want to pursue. You might be really excited about it and want to dive in or you might be on the side staring at the drop below. Business idea validation can give you the confidence to go for it!
I am going to go through different ways to work out if your idea is a good one, needs a bit of tweaking or if its back to the drawing board.
Friends and family
This should probably be your first call. Just send out a quick email or Facebook message to your mum, your dad, your partner, everyone one you went to school with, your postman – just everyone you know!
OK well, you don’t need to send it to everyone. You should prioritise people you know who could be interested in your idea and also people who are going to be honest about this. Send out enough of these messages until you have, let’s say, about 10 really good responses from people. See how it goes, if you’re getting a lot of instant negative feedback, then you might want to rethink your idea.
There are definitely good advantages to this approach, but also drawbacks to it. If you ask your friends and family for feedback, then you are going to get it. Beware that this feedback might not be completely honest, as your friends and family care about you (hopefully) and would not want to be overly critical and hurt your feelings. Here is an example email you can use and feel free to tweak it where necessary;
Hey *insert friend’s name*,
I am thinking about setting up a *made to order fruit juice recipe/video production service/your business idea* and would like to know if you think it is a good idea. Here are some of the details (change these to suit);
- I would send you fresh fruit and veg to you with a recipe once a week for a juice a day
- You could buy a blender from me
- You could choose different recipes
- How much this would cost
I know this might seem a bit daunting, so if you could answer the following questions, I would owe you one! 🙂
- What do you like most about my product/service?
- What do you like least about it?
- What changes could be made to make the most of what you liked and improve on what you liked least?
Do you have any other nuggets of feedback on my idea for me?
Owe you a bunch
And then wait for the responses…
One approach I learned from Noah Kagan at App Sumo is just to do a quick sketch of your on a scrap piece of paper, a napkin or maybe a drawing app on your phone. Then send that sketch to people and ask them what they think.
Whatever they say, take it with a pinch of salt and definitely seek validation for your business idea in some other ways. One way to break through this barrier on whether your friends and family are being completely honest is to ask for a presale.
If they sound really enthusiastic then ask for the money! That will soon separate those who are really interested and those who aren’t!
Now at this stage, you are unlikely to have a completely finished product or service to offer, so let them know that and give a conservative timeline on when you can deliver on your presale. This I learned from Noah and Bryan Harris of Video Fruit.
Keep the people, who have committed to your idea by putting down some sort of payment, in the loop about your progress and be totally honest about where you’re at. Remember these are the most important people, they are your first customers so treat them well. If you think it’s going to take longer to have your product ready then let them know. Better still you can have them involved in the development of your product or service!
If you haven’t heard about Reddit before, now’s your chance! Reddit’s slogan is being the ‘front page of the internet’ and it does a pretty good job of living up to that. It’s an incredible online community that is self-moderating and is home to the good, the bad and the ugly of the Internet.
Reddit users post things they find interesting, funny, informative and so much more. These posts can be text posts, images or usually links to websites. When somebody posts something, Reddit users have the chance to vote it up or down and also comment on the post. Posts that receive a lot more upvotes than downvotes will be bumped up and receive more exposure. If a post receives lots of downvotes then it will be removed. The Reddit community will have spoken.
It’s difficult to do Reddit justice, so I reckon you should all go and check out Reddit.
Reddit is split into lots of different subreddits. These subreddits are focused on a subject or niche, and there are subreddits for pretty much everything! There’s a subreddit on news and people post and discuss the latest news and a subreddit called ‘Showerthoughts’ where people post thoughts they had in the shower.
Know your subreddits
I should probably say that Reddit and its subreddits are quite a fickle beast. Each subreddit will have its own rules on how you can behave and what you can post. I would advise you to check out the subreddit that is relevant to your business and idea and just see how it works and what the vibe is.
I think it’s just a good idea to go to Reddit set up an account, start using it, find subreddits you’re genuinely interested in and start becoming one of the community. Do the same with your target subreddit, if you haven’t already.
You should be careful not to ‘promote’ too much as this is often not liked by Reddit users, so you might have to introduce your idea by way of contributing to somebody else’s post. For example, if somebody was asking for help with video editing and you wanted to start a video editing business, then that would be a great opportunity to respond to the post or comment and introduce your services. You could just stick in a link to your website if you have one, but I think you would be better off inviting people to Private Message (PM) you if they are interested.
There are some subreddits that allow you to promote your product or service and are worth a try but they are often swamped by other people promoting their stuff. Some of these subreddits include,
- ShutUpAndTakeMyMoney – you can post any product you are selling, as long as it is not generic i.e. like a t-shirt with a different design posted on it. You also need to build up enough ‘karma’ to post there. That means you have to have built up your karma by getting enough upvotes on posts you have submitted in other subreddits.
- ForHire – Reddit users, called Redditors, can post jobs for other Redditors to do or can offer themselves up for hire. Most of these jobs can be worked from home, given that Redditors are from all over the world.
- DesignJobs – just like ForHire but is focused on design jobs like graphic designers.
There are loads of other subreddits just like these that you can go and check out. Reddit is such a popular website that even quite obscure subreddits can have quite a large community.
I challenge you to have a look at Reddit and see if people are interested in your business idea and let me know how you get on.
I have made a conscious effort to keep these ways to make money online to be as low cost as possible, but a little bit of money can go a long way if spent wisely.
First, let’s explain paid ads a little bit. In the real world, companies pay for adverts on big billboards next to busy roads and adverts during TV programmes. These companies are paying for the chance to be in front of you and get your attention.
Online, the same thing is happening. There are websites that a lot of people visit and these websites can make a lot of money placing adverts. Some of these websites make it very easy to buy advertising space and get your product, service or message to website visitors. Some of these websites I am talking about include;
I am going to talk about Google and Facebook because I have had experience using them in the past.
Google is obviously a highly used website by millions of people all over the world. You may use it several times a day, pretty much every day. It might be your homepage. You might have got to this post from Google.
When you are searching for something on Google, you may have noticed that alongside the search results, there are some paid adverts. So whilst some of those results are there because Google thinks they are the best results for your search query, some people have paid Google to be placed in such a favourable position. They are placed there because of Google Adwords.
I would definitely recommend you have a go using Google Adwords because you can get a £75 voucher to spend on ads when you spend £25. Claim your voucher here when you set up your account and spend £25.
So how does Google Adwords work?
First, you have to set up a campaign. A campaign is a set of adverts that you have grouped together to pay for at one time. The main things you need to decide are what are you going to call your campaign and how much do you want to spend a day.
Make sure to set this carefully. More importantly, don’t let your ads run for too long if you’re not gaining any value from them because they can keep running and cost you more and more money. The lesson here: keep an eye on your ads running.
After you have set this up, you need to decide what keywords you want to target for your ads. Let’s say you want to sell yoga mats made out of cork or set up a pop burger bar in South London, then maybe you would look for keyword phrases like ‘cork yoga mats’ and ‘burger bar Clapham’, respectively. You might want to think of a few variations for your chosen keyword phrase.
Also, you need to write your ads as well. There are quite a few variations for you to choose from. You can have a text ad, an image one or a video. Either way, the main idea is to say or show something that is relevant and appealing to people searching for your keyword and get them to click on your ad.
We need to direct people somewhere, so we can work out how interested people are in our idea. We will come on to how we do that in a minute.
I am in no doubt that if you are reading this post online then you must know how much time many people spend on Facebook. That makes Facebook a great place to have your advert shown, especially as people spend so long on Facebook and click on lots of different pages per visit. Google Adwords works because you place your ads for relevant keyword phrases. Facebook obviously works differently. Facebook has a lot of information about its users and that means Facebook users can be targeted based on their interests, location, age, gender etc.
To start on your own Facebook adverts, head to Facebook Business.
The set up is similar to Google Adwords but you have to decide which Facebook users you want to show your advert to. Like I said earlier, you do this by choosing different demographics, such as age, location and interests. Have a think about the person who you would like to reach. If you want to set up a CrossFit gym in Manchester, then you would select people who live in Manchester and had selected interests related to fitness and CrossFit and maybe were in related Facebook groups as well.
Again, you’re spending your own money on these adverts and you want them to work for you so get as much information and leads out of them. Run tests with them to see what works and what doesn’t and be careful not to spend too much money on ads that aren’t providing any value to you.
I could talk for longer about paid adverts but now it is best to discuss where we are going to send people who click on our ads to.
One page website to capture emails
The adverts we’re going to set up are going to have just enough information to pique people’s interests. Once they click on your ad, they will be sent somewhere where you capture contact details from these interested people.
There are a number of ways to set up a one page website. I have heard people talk very favourably about Leadpages. Leadpages are known to convert visitors very well into customers. I have set up a free WordPress site, with a domain name I’ve bought and then put a contact form on one page and directed visitors to that page.
There are two services I use to capture contact information and they are Sumo Me and Mailchimp. I could talk at much more length about these two, but the most important thing is to use them to capture the information of interested parties and then you can ask for feedback on your idea and lead that into making them your first customers. You can also add a contact form with WordPress.
Mailchimp embedded form on a WordPress website.
Sumo Me is a suite of apps for your website and some of those apps collect email address for you. One of my favourite apps is the Welcome Mat, which you may have seen on this site. You can decide what message you would like to put on your Welcome Mat. Have a think at what would intrigue somebody about wanting to know more about your idea. You might end up trying a few different messages out.
Mailchimp is an email marketing service where you can send out emails to those on your email list. They also have contact forms you can embed into your web page. I would embed the form into your web page and then write a message about your idea and why your website visitor should sign up to learn more. You could add some images and maybe a video, but I wouldn’t put in too much writing.
If you are wondering how you set up a website in minutes, you’re in luck.
There are free versions of both of these services and I recommend you try them out.
Hopefully, you will have found some great ways to validate your business idea from this guide. These methods will shoot down any bad ideas you have and you can do it all for free and certainly no more than £25. So for free and within a day or two after an hour’s work, you can determine if your business idea is a keeper or not. That’s certainly better than spending months and months along with hundreds, possibly thousands, of pounds on a business that’s a dead end.
If you’re just starting out with setting up your own business then I would recommend using Reddit and your friends and family to start, before trying out paid ads as that be a bit more complicated.
There are other ways to validate your idea and find your first customers that I can discuss in the future.
Hope you found this post useful and let me know what you think about it.
In short, test out your business ideas and let me know how you get on!