Know How To Make More Money Tomorrow? The Problem of Product-Market Fit

It’s possible to be in business for years and still not truly know what you’re selling. The entrepreneurs behind these businesses are constantly creating something new to sell. They’re riffing off old ideas, inventing new ideas out of thin air, and pivoting to new segments of their market to stay afloat. These businesses are always struggling—even when they’re making good money. They feel uncertain about their courses of action, unable to plan, and uncomfortable with the sustainability of their companies. The real problem? It’s product-market fit. "Product-market fit" is when you find a product that the market really wants. Eric Ries, father of the Lean Startup movement, says product-market fit is "the moment when a startup finally finds a widespread set of customers that resonate with its product.” Or as Budget Nerd founder Mark Butler told CoCommercial members, when the yesses start to outweigh the nos. Now, just because you feel constantly compelled to create something new to sell just to stay afloat doesn’t mean you haven’t found product-market fit. It might mean you’ve ignored it. Or, it might mean that you have found a core group of customers who would buy anything you create but that none of the things you’ve created yet appeals to a sustainably sized market. Let’s examine both sides of this product-market fit problem: 1) You haven't found product-market fit yet. You're flitting from idea to idea, not finding much traction, but also making some money so you stick with it. But sticking with it turns into stucking with it. Your business is stagnant. You're working harder than you need to. And you see no way to start making more money. What’s worse: your business has gotten more and more complicated every year. There are 5, 10, or 20 things you could sell but none of them are really contributing in a meaningful way to your bottom line. You know your can always hustle for more sales and more revenue. You might even have some customers that love everything you do—but any attempt to reach a broader market has failed. Getting your offer into the right hands has just never come easy. You might be glad to know that the solution isn’t to create something new… again. The solution here is to take one idea and work with it long enough to actually figure out what is going on. Just because an idea doesn’t work straight out of the gate doesn’t mean it’s the wrong idea. And just because you’ve failed to reach a bigger market doesn’t mean you can’t. It’s just that every time you start up a new idea, you lose most of your ability to determine what was working—or wasn’t—about your previous idea. Choose something you’ve had some success with in the past. Then decide on 1 change you want to make to that offer (the format, the positioning, the messaging, the scope, etc...). Form a hypothesis about the result that 1 change will make (more customers interested, less time selling, less hands-on delivery, etc…). Finally, test your hypothesis by selling your offer. Once you’ve sold it, decide whether you’ve proven your hypothesis or not. Then form a new hypothesis and test again. I recommend at least 3 iterations of any idea before you scrap it or pivot. Some offers that have gone on to make millions have required many more iterations than that. 2) You've found product-market fit and, instead of sticking with it and learning how to accelerate your revenue based on that offer, you went off and made something new... ...again... and again... and again. This is the real killer. As my old boss would say, "You snatched defeat out of the jaws of victory.” Here’s the thing: this scenario doesn’t look much different from the first. Your business has grown more complicated, you jump from offer to offer, you’re always creating something new. But where this scenario is different is that, at some point, you said: “Wow! That was easy, I wish they could all be like that.” The reason you stuck with creating new things is likely because you have a fear of sticking to one thing, doubling down on what you do, or doing the work to reach people you don’t already have a relationship with. But until you do all of those things, you’re going to spread yourself and your business too thin. In this case, the course of action is to identify the profitable, marketable product you already have and start paring back the rest of your business model so that all of your resources can be directed toward that offer. Your team is focused on it, your free capital is focused on it, your marketing efforts are focused on it. The solution isn’t to do more or create more (this is rarely if ever the solution, actually). It’s to do less and create less. This can be incredibly uncomfortable for a creative person. The trick is to find the art in growing the business—and trust me, it’s an art Bottom line: Unless you're feeling free & easy with your business and know exactly how to make more money tomorrow, you're likely finding yourself in one of those 2 scenarios. So what's going to be your next move?