So you have a great idea….or so you think. How can you quickly get an idea if there might be a market for your idea or product? Tradition says you should start writing a business plan and work through that. While I still think there is great value in going through the business plan process, there are some great tricks to test your idea that don’t take too long, but might give you some idea.
1. Google Search Terms: Have a look and see how often people google the key words to your idea or business.
2. Amazon.com Magazines: Look and see how many magazines are in your market and how often they are published. Chances are if the is only one or two and they are quarterly, might not be a great market.
3. Craigslist or Kijji: These are some of my favourites for a product or service. Put up an ad and outline what you are selling. See if people actually email you. Simple way to see if there is interest. Not like you have to provide them any info or service, but get an idea if there is a demand.
4. Competition: Its not necessarily a bad thing. Chances are if there is no one in the market you are looking it, it might not be that great of a market. Just make sure there are not too many in your market.
5. Quick Break-even Analysis: Think about how much you can sell it for and what it costs. Thats your profit on each unit or service provided. Now figure out how much you want to make per week/month/year. Divide that amount by the profit per unit and get an idea if this is something you could make money in and if its reasonable. This is often where a number of business ideas get stopped, you need to be able to make a reasonable amount for your effort.
6. What is the Revenue Model? Its one thing to come up with a great idea, but is this something people will pay for? Some “successful” companies like facebook are still trying to figure this out. How can you make money off of this idea. There are a lot of things on the internet that everyone expects for free, so make sure you think, is this something people will pay for?
7. Google Adwords Campaign: Have a look in the google adwords tools to see how often words in your area are searched.
8. Ebay: Try selling your item there. If you are thinking of selling the same item, search “completed auctions”. This shows you what people have actually paid for the item. There are lots of items I see on ebay that are for sale at a high price that most people will not purchase. You can gain a lot of info from ebay if you are selling a product.
9. Ask around: Go to competitors or prospective customers and get their thoughts. Find out who they buy from now, or if they would want something like you are selling. Often, if you just ask employees, they will tell you way more than you should probably know! Could find out great resources, current prices that customers pay, or might give you info to suggest a new and/or better? You never know.
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