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Validate a Product Idea: A Step-by-Step Guide for Startups

Validate a Product Idea: A Step-by-Step Guide for Startups

Proper validation of your idea can make or break your business. This stage should be approached with due diligence, as failures are not uncommon and normally costly. On one hand, building an app may seem quite straightforward, when you look around and see how successful businesses in almost any field adopt their versions of the ‘mobile-first’ approach. Their applications are downloaded by more and more people across the globe. 

According to Statista, in 2018 there were 192.45 billion mobile downloads. To put it into perspective, in 2021 there were as many as 230. This growth will not stop for sure. On top of that, users are highly engaged when it comes to mobile apps. In 2020, the duration of an average session was as follows:

  • 5.5 minutes with banking apps;
  • 4.76 minutes with payment apps;
  • 21.19 minutes with casual gaming apps; 
  • 9.18 minutes for online shopping apps (we at HOUSE OF APPS like this figure very much);
  • 11.12 minutes for eCommerce marketplaces and classifieds (the same holds true for this statement as well). 

Finally, all those engaged users enthusiastically spend money on their applications. For instance, ‘gross consumer mobile app spending amounted to 170 billion U.S. dollars, up from 143 billion U.S. dollars in 2020.’

What could possibly go wrong on the playground like this? As business practice shows, unfortunately, quite a lot of startups do not validate an idea. Big mistake before the business even had a chance.

Why App Ideas Fail

To begin with, we need to lay it all out - most mobile app ideas either fail at the start or do not reach maturity, i.e. do not survive the first year. Exact estimates may vary. Back in 2015, SAP estimated that 78% of apps are routinely abandoned after the first use. As of now, Mobile App Daily offers a different perspective and says that only 0.1% of all launched applications succeed in achieving ‘commercial success in a one-year perspective.’ Finally, one of the Forbes contributors published the following evaluations:

  • When it comes to consumer apps, the average failure rate is roughly 99.5%;
  • As for B2B mobile tools, it is slightly better with a 13% success rate. 

What is hindering all those mobile development projects at the very beginning? Well, there are some estimates as well.

In a recent survey by CB Insights, the following frequently cited reasons were identified:

  • Insufficient capital, with 38% of respondents citing this problem; 
  • No real market demand for the product, with 35%;
  • Being outcompeted by rivals, with 20%;
  • Flawed business model, with 19%;
  • Legal and regulatory issues, with 19%. 

As you can see, the three highlighted points are inextricably linked to an improperly validated business idea. Here we'll talk about how we at HOUSE OF APPS validate a mobile app idea for a startup. We'll share a step-by-step guide to testing a product idea and share a few tips about how you can do it too.

Our Approach to Validating Startup App Ideas

Based on our first-hand experience and the experiences of the startups that we constantly interact with, these are the steps we would take for validating a product idea:

1. Identify a user concern that either hasn’t been resolved at all or has been resolved insufficiently. Your real-life need should answer to the three key questions:

  • What will be the practical and measurable benefits generated by your app for users?
  • What advantages will your app users enjoy in comparison to those who don't use your product?
  • Are there any similar products or services out in the market? If there are, how should your app take the user experience to a higher level?

The ways you can obtain this understanding can be:

  • Carry out interviews with your potential end-users. Just about10 interviews should give you valuable and actionable insights.
  • Use secondary source data to conduct desk research. While secondary data won’t give you a whole picture, it may provide a direction, additional thoughts on your product idea.

2. Measure the size of your potential audience. The market niche you intend to fill with your mobile app must be big enough for your business to sustain and grow. As for the metrics you need to take into consideration, we recommend looking into:

  • Gender identity
  • Age
  • Their place of residence (most apps are designed and built for large metropolitan areas, however, your target audience may differ)
  • Disposable income
  • Vertical

3. Next, you should focus on user personas and envision their contexts and the way they would use your app. Such personas represent various characteristics of your target audience. They are, so to say, your ideal (paying) customers. Each persona should consist of a clear understanding of their:

  • Pain points based on your initial assumptions and previously collected data;
  • Their core motivations;
  • User flows unifying them within a common framework.

4. Creating a customer journey map. This stage requires your increased attention. On the one hand, the pain points of your personas must be addressed in an end-to-end fashion. On the other - your app should be easy-to-use and intuitive, more so for innovative product ideas:

  • Map out user touch points;
  • Examine the actions users need to take to be able to reach their goals via your app. Each goal ideally must be two or three clicks away
  • Summarise user scenarios.

5. Shaping a Unique Selling Proposition. Identify whether you can formulate a unique, convincing, and easy to communicate pitch. As simple as it sounds - if your pitch stands out against competitors and appears persuasive, it  increases your chances for success.

6. Prototyping and user testing. This stage, i.e. crafting interactive prototypes is an effective way to save time and development costs and still be able to test your assumptions and identify potential problems. This is one of the key user testing stages for the product. Interacting with your prototype users are much better placed to provide a comprehensive feedback that can a) direct the idea validation for you startup and b) narrow down on features.

7. Building an MVP. Minimum viable product is a concept aimed at releasing a mobile app with the minimum critical features needed to test the reaction and willingness to pay for your product or service by your target audience. Once the feedback provided is received - hopefully, positive - be cautious with this one, to not fall prey to favourable interpretations, you can proceed with designing and engineering more advanced and resource intensive features of your mobile app.

If you have a product idea that you are passionate about, let us help you test your hypothesis and validate the idea of your product. Contact us to test your assumptions in a quick and cost-effective way and we'll help you release a successful MVP that brings your idea to life.