What is Product-Market Fit?

There are various contributories that help an enterprise succeed and join in the competition. Foremost among these is Product-Market Fit. But what is Product-Market Fit? Why is it important for startups? In this article, you will find all you need to know about Product-Market Fit. 

What does Product-Market Fit mean? 

Product-Market Fit is the acceptance of a product or a service that is provided by an enterprise, by target customers and the procurement of the needs of the market. In a nutshell; it could be summed up to settling the gap of the market by a product. 

The importance of Product-Market Fit for Startups 

When Product-Market Fit is achieved, while startup succeeds, the customer becomes more loyal. Because for a startup, the best way to stand out among its competitors is; to find needs that yet do not have the solutions and to produce these solutions. The customer, who buys the product or the service, appreciates the enterprise for meeting the missing needs among its other competitors and by recommending the product or the service, positions the enterprise in a higher place in the market.

In order to stand out from competitors, it is of utmost importance that the Product-Market Fit research is carried out, observed closely and that the enterprise plans its steps in accordance. Enterprises, which achieve Product-Market Fit, simultaneously enhance their customer volume and their success rate. 

4 Effective Steps to Achieve Product-Market Fit 

In order to achieve Product-Market Fit, taking some of the steps more cautiously is crucial. These steps are: 

1) Determining Target Customer

Identify who makes up the target customer base of the product or the service that you have developed and find a way to meet with this target customer. While you can do this conducting various surveys, tests or using social media channels or you can also work with agencies who provide these services. 

2) Analyzing Competitors

Once the target customer is determined, competitor analysis begins. During this analysis, the focus is on to what degree the customer is satisfied with the product or service provided by competitors or similar companies. Thus, gaps in the product or service that is provided by competitors, which do not necessarily fulfill the expectations of the target customer are determined. 

3) Developing Products and Services in Accordance with Needs 

In this step, decisions over what a startup needs to put in action to stand out from competitors and to increase its preferability are made. In accordance with the needs of the target customer, seeing what kind of other values can be added, the product or the service can be developed.

4) Receiving Feedback 

Once the revisions and improvements on your enterprise are completed, the last step would be to receive feedback from your target customer. Successful entrepreneurs point to 2 critical questions that should be answered. The first of these questions is: “Would you feel the absence of this product/service if it disappeared completely?”. If at least %40 of the target customer replies positively to this question, this implies that your project is receiving positive feedback and will meet the customer needs of the market. 

The second question that should be asked is: Whether or not the customer will recommend the product or service to another person. Customers who not only stay satisfied but share their experience with other people will help improve your enterprise and is a solid proof that you have achieved Product-Market Fit.

In this article we talked about why it is important to achieve Product-Market Fit and some important clues. You too can apply these clues provided to stand out from your competitors and strengthen your place in the market with products and services that meet customer expectations. For more content on entrepreneurship keep following BTM!