Are you excited about your new product idea? Do you believe that it will revolutionise your industry? Before investing time and resources into product development, take a step back and validate your idea with real customers. In fact, a lack of proper validation is the number one reason for product failure.
Let’s take a look at one of the best examples of a Perth-based business that tested their idea with real customers before investing in product development – Openn. Their vision was to create a more transparent process to sell houses, where buyers could see what other buyers were willing to pay for a property, and sellers could see what buyers were offering. To test this concept, they employed some of the most basic tools available – SMS and paper.
During the idea validation phase, they sold houses by scheduling bidding processes. Each buyer wrote down their bid on a piece of paper, signed it, and SMSed the agent. The agent then forwarded this to all bidders, and the process continued until the final bid was placed, and the property was sold. This straightforward approach yielded successful results, with numerous houses sold along the way.
Openn’s journey didn’t end there. They went on to develop an online sales platform that now facilitates billions of dollars in property sales. However, their success didn’t happen overnight; it resulted from customer testing, product validation, and learning. Five years later, Openn is listed on the ASX with a market cap of circa $50M.
Key lessons from Openn’s success story:
- Validate ideas with real customers before product development.
- Simple testing with basic tools can be as effective as software development.
- Utilise landing pages, surveys, and customer interviews for validation.
- Prioritise learning and problem discovery in the initial phase, not just development.
Remember, employees are your customers too; validate improvements in internal systems before diving into product development.
At Horizon Digital, we value idea validation’s importance and have assisted numerous businesses in the process. If you’ve successfully validated your idea, we offer free advice on implementing a rapid validation process. Contact us today!