The idea validation is all about verifying the idea on the basis of 3 parameters.
- Desirability – Do product to be built will be desirable for customers to address their existing needs or problems.
- Viability – Will customers be willing or can afford to pay to solve the need or the problem? Is there a sizeable market for business viability
- Feasibility – Can the product to address the need be built in the most optimal and economical way?
There is a fourth parameter to idea validation that most of us miss is timing – WHY NOW? WHY NOT EARLIER? Along with validating the idea on the parameters of desirability, viability and feasibility, Product Manager has to validate WHY IT IS NOW THE RIGHT TIME to invest on productizing the idea. Understanding WHY NOW is critical to ensure that the new product is neither too early nor too late to the market.
Timing new product – Why now?
During validation phase of the new product idea, the larger discussion that needs wider attention is to figure out the right time to start new product development or the focus is more towards understanding why it is now the right time to develop the new product. Timing is one of the most critical factors that can determine the success or failure of the product. Product Manager, therefore, has to answer the most pertinent question – WHY NOW? Why it is now the right time to translate the idea into a full-fledged product, so (s)he can ensure that the product is not too early or late to the market.
Discussion about timing is not very critical if the idea is fulfilling an already existing need addressed partially or fully by competitor products successfully. In such a scenario, the focus will be more on ‘How Differently’ is the idea addressing the need. When Mark Zuckerberg created Facebook, MySpace and other social sites are already in existence. MySpace is pretty famous at that point in time. So the question would have been how differently Facebook should/would be built to succeed against competitors. I am not sure whether Mark Zuckerberg has done any competitor analysis and it is not significant for this discussions. What is important is that timing might not be very pertinent if the idea has already been addressed by competitors.
There are 2 types of needs that essentially require an idea to address them
- Dormant Need – These are needs that are in existence since a long time (but unaddressed so far) and the recent improvements in technology or increase in economic status of the population or any other factor would have made it either feasible or viable to address the need. These kinds of needs can be either known to customers or not recognized by the customers.
- Emergent Need – There are needs that have either emerged or will emerge because of the existence of certain drivers.
Therefore for any Product Manager to effectively respond to WHY NOW? I am fundamentally relying on 2 parameters
- What changes in technology, socio, economic or other related factors make it either feasible or viable to address the dormant need
- What are the drivers triggering the emergent need or rather what drivers will germinate a need in future?
Identify drivers making it feasible or viable to address the need
- Availability of reliable sensor has paved way for lots of IoT use-cases such as smart parking, intelligent health monitoring etc.
- When it was not financially viable for banks to establish branches in rural areas, the emergence of mobile banking extended the reach of banking services to rural people at an affordable cost.
- E-commerce enabled the possibility of selling less of more niche products and still make profits (Remember long tail coined by Chris Anderson). Further E-commerce facilitated the creation of a marketplace to bring buyers and suppliers much closer than ever before.
A closer look at the above example will clearly indicate that there was always a need to bridge the gap between buyers and suppliers, e-commerce has facilitated to shorten the gap. With an increase in the number of cars, parking was always a hustle in most of the big cities; IoT has facilitated the possibility of the smart parking system. Rural population always had banking needs to either receive money from their wards living in faraway cities or lend money for their farming activities. Only mobile banking has made is feasible to extend the banking services to the rural population.
In this scenario, identify jobs or products or services that did not exist 10 years ago. How would someone explain the sudden emergence of new products or services had it not been for the existence of any dependent drivers? The emergence of new disruptive technologies always spawns new needs. They create a wave giving rise to new allied products or services.
- The rise in smartphones has created a need for Apps.
- Increase in demand for sharing and uploading videos has created a need for better video optimization techniques for better transmission of video over IP networks.
- The proliferation of more network connected devices has spurred the need for additional addresses, resulting in the creation of IPv6.
- Had it not been for the availability of high-speed internet connectivity and proliferation of handheld digital devices to take video, YouTube would not be successful.
- Increase in population of elderly people by a factor of 2X in the US by 2030 will definitely create needs for old age-friendly products or services.
Technology need not be the only factor contributing to emergent needs. Regulation and economic status can also contribute to emerging needs
- Increase in demand for more power and inability to meet the demands would create the need for alternate energy energy-efficient products.
- Depletion of portable water would create the need to derive alternate sources for portable water
- Increase in per capita income increases the spending power of consumers thereby leaving lots of money on the table to be grabbed by anyone providing irresistible services or products. Per capita income is a critical factor to watch while launching expensive goods of services.
Identifying whether a need is dormant or emergent and identifying whether an environment is conducive to build a new product can help Product Manager decide whether it is now the right time to start productizing the idea. If the timing is not appropriate, then there should be a possibility for an organization to preserve the idea instead of discarding it. The idea could later be bought to life when an environment is conducive to the idea to prosper.