If you’ve ever found yourself asking the classic ‘Should I? Shouldn’t I?’ about your new product idea, you’re not alone—many new product ideas spring from random bursts of genius rather than methodical planning.
It can be scary to pull the trigger on your new ideas without some degree of certainty that they’ll be winners, and as many eCommerce sellers know, the fallout from a poor product choice can be painful.
Obsolete inventory can add an extra 25% onto your business goods cost, and unsold inventory costs the US economy an eye watering $50 billion every year. Combine this with the fact only 40% of product ideas make it to market and of this amount just 60% turn a profit, and it’s clear to see: product selection is no joke.
While killer product ideas can have your brand inducted into the eCommerce hall of fame and provide a steady revenue source, the opposite is true for failed products. Wasted time, money, and dreams become your reality, not to mention the immovable stock which rubs salt into your wounds.
But with the right strategy, you can ensure product success every time. And you’re not alone. In this post, we’ll share the step-by-step process you need to validate your ideas before giving the go-ahead (knowing you’ll succeed).
Need some cash to fund your next big idea? Explore our funding options.
Before you dive head-first into research, take a quick reality check to see whether launching a product is possible right now.
Ask yourself:
If, after crunching the numbers and looking at the eCommerce funding requirements, you realize you have to shelve this project for now, that’s OK.
It’s a matter of ‘when’ not ‘if’. So, keep a new product ideas list, save money, and work toward securing any additional capital you need.
On the flip side, if you determine you can go full-steam ahead, it’s time to get down to business and answer a fundamental question:
Which funding option is the best for my launch?
Your answer will depend on a variety of factors like your current revenue, liabilities, and goals.
For example, if you’re launching a spin-off product to extend your already successful range, a cash advance is a solid option. You can use the sales from your existing products to fund a new one.
However, if you’re launching a brand new product with no related sales history or successful track record, you’ll need a larger cash outlay to get your product off the ground. In this case, eCommerce working capital funding is just the ticket.
Want to find out which eCommerce funding is best for your business? Explore your options today.
Once you’ve got some potential product ideas down, it’s crucial you take the time to really lean in and define your new product from start to finish.
To better understand the market you want to enter, and position yourself for maximum success, start off with these simple questions:
It’s vital you uncover the exact factors that set your product apart before investing any cash.
Here are a few areas to consider:
Don’t have customer personas? No problem! Check out this handy guide by Hootsuite and learn how to make your own.
Now that you have a clear idea about your products and target audience, it’s time for some research. But not just any old research—you’ll be nosing into your competitors’ business.
But first, a warning: competitor analysis can be a long, hard slog—so, brace yourself and think of the long-term pay-off if it feels repetitive and boring.
To kickstart your competitor analysis and reveal winning products in your list, here’s a step-by-step process to follow:
To know what you have to beat, find out who your top 5 direct competitors and 5 indirect competitors are. Plug their names into excel or a table for easy referencing later.
Okay, not really. The goal is to find out what their money makers, customers, and strategies are so you can effectively differentiate in your product launch.
For example, you can:
Put the following questions into the same excel or table housing your competitors’ names. Then go through your list for each company, and ask:
💡Pro tip: Sign up for competitor newsletters ASAP to get a better idea of how they position their brand. By the time you’re ready to launch your new product ideas, you’ll have a backlog of copy, design, and campaigns to use as inspiration.
This next one is a goldmine so don’t skip it.
Look into competitors’ customer reviews to find out what people are saying about their products. This will help you find ways to improve your new (and existing) product ideas.
Look on reputable review sites like Trustpilot and Reviews.io, your competitor’s store, and any other shops or platforms they sell on. Just be mindful of fake reviews and disgruntled customers, which can skew the data. If you’re not sure how to spot a phony review, check out this awesome post by Which.
The last tactic is to find a few up-and-coming brands that have recently launched a product similar to the one you intend to launch.
This approach will help you determine how they’ve altered the product to fit their customers and how they’re performing as newbies in the market.
Remember, when building an eCommerce business, the goal isn’t to reinvent the wheel. Instead, take what’s working and enhance it to get the most reward for the least output.
These snippets of info from competitor brands help you find similarities in their growth strategy and pointers on how they stand out. You can then use this information to optimise your product development and launch processes.
Another part of your validation strategy is to source analytics and look for patterns that confirm your assumptions.
Here are some of the best analytic tools to use:
52% of people worldwide believe brands should act upon the feedback they receive, so customer feedback is essential to tweak new product ideas to suit audience needs.
If you already have a loyal customer base, you’ve lucked out—there are few recommendations more accurate than those delivered straight from the horse’s mouth (aka your raving fans).
Use these relationships to your advantage. Ask your audience things like:
You can conduct social listening casually by posting a survey on Facebook or posting on Instagram. Alternatively, you could host focus groups or get help from a market research firm to run surveys and interviews.
By following these steps, you’ll soon have a good idea of whether your new product ideas are headed for the top spot or destined for the trash pile. Plus, you have some great points for your product page copy and marketing if you decide to launch any products.
Whether you’re launching a new lead magnet, promoting a pre-sale, or funneling traffic to a particular product, a landing page is the ultimate sales pro you want on your team.
Here’s how to create an unbeatable landing page:
If you have a little more time, set up a social media page dedicated to the niche you serve in, and build a community of like-minded people.
Here’s how:
Going social will ensure you have an audience already in place when you launch your next product. If you’re curious about how to quickly build your niche social media site, check out this helpful guide by Niche Pursuits.
There are two things every entrepreneur hates: wasting time and wasting money.
Don’t be like those unfortunate sellers who believed the promises from customers, friends, and family that they would show up and buy on the day of your grand launch.
Avoid costly let-downs by asking your audience to put their money where their mouth is and show their approval by dropping their coins before launching any new product ideas.
Pre-sales won’t only offer you the validation you need to charge forward with your new product ideas, they’ll also give you a healthy cash injection to help fund your launch. Sweet!
Intuition, calculated risks, and fearlessness feature heavily in every entrepreneur’s path. Yours is no different. After you run the numbers, do your qualitative research, and triple check your results, it’s action time!
Don’t get caught up in analysis paralysis because the truth is no matter how much you research, sketch graphs, and talk to existing customers, they’re all assumptions until you get out there with your new product ideas and see what the market actually says.
Once you’ve done your market research and competitor analysis, follow these three crucial steps:
These steps will ensure you lead your product development with facts, so you can serve your customers better than anyone else and avoid wasting resources.
No matter what you sell online, no one wants to invest in a dud.
Your hard-earned cash should fuel your progress, not wreck it, so it’s crucial you take the time to scope out your market before throwing cash at your new product ideas. Even if you’ve been in a niche for years, a lot can change in your field without you noticing if it’s not your main focus.
When you take the time to validate your new product ideas, it helps you build faith in them. Plus, your research and plans can help secure your eCommerce business’ even further into the future.
So, be patient with yourself on this journey and try your best to avoid emotional attachments to any new product ideas, as this can cloud your judgment. Now, put your boots on the ground and start holding your ideas to the fire!
Ready to stop dragging your feet and finally launch your new product ideas? Find out more about our eCommerce funding options.
