Product/market fit means being in a good market with a product that can satisfy that marketMark Andreessen
The major reasons related to product-market fit are No market need(42%), Poor product(17%) and product mistiming(13%). At least 72% of startups face one of the product market-related issues directly, making it the primary reason for startup failures.
How to get the market right?
You want to see some amount of competition or existing players in your business. If none, deep research needs to be conducted as in why the opportunity being perceived by you is not being exploited yet. Often times, there are several not so obvious challenges which might render your product/ service not useful or execution too difficult.
How to get the timing right?
You want to see some competition or players in a similar space but the presence of a large number of similar competitors with no differentiation is a sign of a mature market. This is an indication of late arrival to the party and product will need to have considerable differentiation in either product or how it is being serviced.
How to get the product right?
Product development is an iterative process beginning with the customer. Enough time needs to be accounted for in the plan to ensure that tweaking etc needed for fit is made available for.
- The core concept or prime feature needs to find sufficient traction before further updates and enhancements.
- Core idea needs to be simple(KISS) and useful, eventually with time and customer behaviour understanding, enhancements and updates can be released.
- Feature release should be agile in making, with constant updates. Waterfall approach can be avoided.
- Stay in constant touch with the customer base, it’s not where you start but how fast you iterate and adapt is what’s gonna define the product’s fit.
In a specific B2C business case where users didn’t have to pay to use, the stickiness of a product can be measured using their ability to commit time. The blue line indicates new users and the orange line represents returning user’s count. Had product-market fit been achieved, the orange line would have risen along with blue-line. The business below is still a pre-product market fit. Returning user’s metric is being used to judge for product fitness.