Market validation is the process of testing and verifying your assumptions about your target customers, their problems, and your solution. It helps you avoid wasting time and money on building something that nobody wants or needs. But how do you decide what to do next based on your market validation results? How do you pivot or persevere with your idea?
Pivoting or persevering is the key decision you have to make after validating your market. Pivoting means changing one or more aspects of your business model, such as your customer segment, value proposition, revenue model, or distribution channel. Persevering means sticking with your original vision and strategy, and refining or optimizing it. The goal is to find the best product-market fit, which means that your solution solves a real and meaningful problem for a large and reachable market.
This reminds me of advice psychologist Adam Grant mentioned in one of his books - to embrace thinking like a scientist. As a scientist, you view your opinions more as hypotheses in need of validation. With that mindset, pivoting isn't weak or a sign you've failed, it's a sign you're progressing. This mindset is particularly valuable for entrepreneurs. In one research study, entrepreneurs that were taught to think like scientists brought in over 40 times the revenue as the control group!
In entrepreneurship, you need to persevere and pivot to your goals. It is vital to persevere and keep going without giving up but many times you do need to pivot in order to achieve your end result. Being adaptable is such an important trait to have as an entrepreneur. You constantly need to adapt to new technology, new ideas, and new obstacles. I love the quote- "write your goals in pen but your plan in pencil"
Pivoting is necessary because evolving is life. Everything changes and evolves. To persevere is the only option when your calling and purpose is the highest priority. I don't know how to quit my purpose because that sounds like death. God picked me to struggle, feel pain, and continually invent new ways to excel and turn a profit. I change the world because it is the only thing I know how to do. I'm not picking my calling based on trends or money--I do what burns deep in my soul. I do what I cannot die without achieving or expressing/manifesting each and everyday.
Before you can pivot or persevere, you need to analyze your market validation results and compare them with your hypotheses. You can use different methods and tools to collect and measure feedback from your potential customers, such as surveys, interviews, landing pages, prototypes, or minimum viable products (MVPs). You should look for quantitative and qualitative data that indicate the level of interest, demand, satisfaction, and willingness to pay for your solution. You should also identify the main risks and uncertainties that you still need to address or test.
Having brought 1,000’s of new parts into the world, I’ve found it extremely important to best understand as completely as you can the problem you’re trying to fix. Then understanding who you think needs this solution. Having messed this up many more times than I would like to admit determines success or failure. Once you have a solution It is critical to understand the 4 P’s (Marketing Plan) Price, Product, Promotion and Distribution. Then create a business plan to see if it cash flows, CRITICAL to be HONEST to the point of UNDERESTIMATING sales and OVERESTIMATING expenses to see it it still cash flows. Passing these milestones, then test, test test the product for market acceptance for price and performance! Prayers are good!
Getting feedback through surveys and interviews is a great way to determine customer satisfaction. Always remember that even though they may like your product/service doesn't mean they will purchase.
A mentor of mine once told me - "No amount of customer feedback surveys, interviews, or likes matter. The only thing that matters is when someone swipes a credit card." In other words - the ultimate measure of market validation is when someone is willing to pay your for your product or service. People parting with their $$ is the ultimate measure of market validation!
When deciding whether to pivot or persevere, there is no definitive formula or rule, as it depends on your context, goals, and criteria. Generally speaking, you should pivot if your market validation results indicate that your assumptions are wrong, your solution isn't solving a real or important problem, your market is too small or inaccessible, or your revenue model is not sustainable or scalable. Conversely, you should persevere if your market validation results show that your assumptions are valid, your solution is solving a real and valuable problem, your market is large and reachable, and your revenue model is viable and profitable.
Your decision of whether to pivot or persevere is dependent on several factors, including: 1. Your state of mind - do you still believe in your original plan? - are you tired, frustrated and don't have energy to continue? 2. Your resources - what assets do you have now and how can they be best deployed? - what support can you reasonably expect to get in a short period of time? 3. Trends - are trends positive or negative for your current direction? - what have you learned about user behavior? - what technology is missing that is necessary for your success? 4. Plan - can you articulate concrete next steps and SMART goals? - what are your alternatives? Answer at least these questions and the answer should become much clearer.
This is a common internal battle for many entrepreneurs. So many times, it can be difficult to admit that you need to pivot because you feel a personal attachment to your product/service. Knowing when to pivot is understanding your mistakes and using that for your future product/services. If you are leaning towards persevering then you need to think about- what are some things that I could be doing to better promote my business.
If you decide to pivot, you need to identify which aspect of your business model you need to change, and how. You can use frameworks such as the Lean Canvas or the Business Model Canvas to map out your current and desired state, and brainstorm alternatives. You should also communicate your pivot to your team, stakeholders, and customers, and explain the rationale and benefits behind it. Then, you should repeat the market validation process with your new or modified assumptions, and test them as quickly and cheaply as possible.
This all comes down to how drastic you are trying to pivot. When you are going through a transition, it is important that everyone understands the end result and that everyone is on the same page. Make everyone see the final vision and understand your motives behind this change.
Execution generally involves a "soft pivot" or a "hard pivot". Either approach should be communicated to stakeholders, but pivoting doesn't mean you have to completely overhaul everything. If you're not having much luck with your current target market but have a thesis about product-market fit in an adjacent category, you can "soft pivot" by tweaking the product roadmap a little and focusing efforts on the new market. A "hard pivot" often requires going back to basics and overhauling the entire product roadmap, the current team, and/or the Total Addressable Market (TAM).
If you decide to persevere, you need to focus on improving and scaling your solution, and validating your growth strategy. You can use tools such as the Value Proposition Canvas or the Customer Journey Map to understand your customers' needs, pains, and gains, and design better features and experiences for them. You should also monitor and optimize your key performance indicators (KPIs), such as customer acquisition, retention, revenue, and referrals. Additionally, you should seek feedback and support from your mentors, peers, and investors, and learn from your successes and failures.
Keep God first... and remember God is love. If you don't think you need God or love now, wait until it hurts a little bit more. You will feel pain--everyone does. Remember the why, and remember who you're doing it for. You owe you!
If you have decided to persevere, here are some things you should keep in mind: - Have I done everything that I could to make sure this business is successful? - What are some ways that I should improve? - Who do I know that has a similar business and how have they been successful? - What is some of the feedback I have received from customers and how can I use that to improve?
Pivoting or persevering is not a one-time event, but a continuous process of learning and adapting. To do this successfully, you should be aware of common pitfalls such as pivoting too often or too late, persevering too long or too soon, and being biased or stubborn. When pivoting, make sure you have enough evidence that your current approach is not working, but don’t wait until you run out of resources to do so. When persevering, make sure you have enough evidence that your current approach is working and that you have validated your core assumptions and found product-market fit. It’s also important to be open-minded and objective when analyzing market validation results and not let emotions or ego interfere with your decision. Be willing to listen to feedback and advice from others and don’t be afraid to admit mistakes or change direction.
This can be hard for entrepreneurs as we can take feedback on our products/service very to heart since we have invested so much time, energy, and money. Whether you are pivoting or persevering it is best to remove the emotional aspect and try to think it through strategically. This is a lot easier said than done and this is where having a mentor or a consultant can come into place. Having someone that can look at at business holistically and analyze it can be extremely beneficial.
As entrepreneurs, being decisive is such a vital trait. Whenever I have to make big decisions, I always like to think them through and sleep on them and not make quick decisions on the spot. Sometimes it is best to soak it all in and then make a decision instead of making a quick decision and then ending up regretting it.