Product-Market Fit: Lessons from a Product Manager
I’ve been on product teams for a long time, helping transform rough ideas into real products and bring those products to market. I’ve honed some great techniques for validating products and want to share them with you in my new book Find Product-Market Fit Faster: Lessons for Product Managers.
In this excerpt from the book I give an introduction to the concept of “product-market fit” and the steps that product managers can use to iterate ideas, validate concepts, and make rapid decisions about what to build.
Products launch, products fail.
For some products, it may take years to find a fit in the market. And it’s often during that time products fail. They fail to see traction in the market, and the startup runs out of cash.
I’ve been a part of product teams for almost 20 years now. During this time, I’ve helped transform rough ideas into real products and bring those products to market.
Thanks in part to practice, and in part to mistakes made along the way, I’ve honed some great techniques for validating products. This technique is the process I used to quickly iterate ideas, validate concepts, and make rapid decisions about what to build.
This validation process will hopefully help you determine who your customer is, the value proposition for your product, what features to build, how to price the product, and how to talk about the product with potential customers.
By far, my best piece of advice for product managers and entrepreneurs setting out on their journey to product-market fit is this:
Make better mistakes faster and fail as early as possible.
It may seem like counterintuitive advice. But I can assure you, it works. In fact, it was with this mentality that my co-founder Greg and I were able to create a rapidly-growing SaaS business with thousands of happy customers.
As part of this guide, I’ll share our story at ProductPlan. I’ll share examples of the real lessons we learned as we validated our market, got our product built quickly, and eventually found product-market fit.
What is Product-Market Fit?
Before I start, let’s get on the same page about what I mean by product-market fit. You’ve likely heard about the magical product-market fit that startups aspire to — the so-called ‘holy grail’ for products and businesses alike. There are a lot of different ways to define it. Here’s how I like to think about it:
Your company is selling a product that solves a problem for a market segment, and you’re selling it in a repeatable way.
- Solving a problem.
- For a defined market.
- For customers who are willing to pay for solving it. • And selling to them is repeatable.
Bonus points: Finding a model that is cost-effective to acquire customers. Can you gain customers for less than what they pay you?
While this sounds like more of a mature company, my experience shows that you can find product-market fit earlier, and begin to reduce the risk of failure even before you build the product. This book focuses on the early stage work you can do to better assure product- market fit.
I’ll also add that you’ve probably found product-market fit when you’re no longer pivoting significantly. While experimentation, market expansion, and change are essential, you’re no longer implementing wild gyrations of the model to make the business model work. You’re not saying, “We got this wrong, let’s try another market.” Or, “If only the product had this feature, then people will buy.”
A lot of companies will continue to revolve on revenue models and value propositions. They’ll ask themselves these questions:
- How should they talk about the product?
- Who are the customers that they should be approaching?
All the while just hoping, okay, one day this is going to click. Well, when you stop doing that, and you find something that’s repeatable, then you probably have found product- market fit.
That can happen fairly early in the process and this is how we did it at ProductPlan.
The Process for Finding the Fit
Here are the tried and true steps I used:
- Start with the end in mind.
- Be a seeker of pain.
- Make your best guess.
- Find patterns of pain with customer discovery.
- Validate the Minimum Sellable Product.
- Find repeatable economics.
You can read more about the steps in the book. And if you have experience with finding product-market fit, I’d love to hear your stories!
