Don’t let anecdotes run your business
Don’t you love the excitement when you land a brand new deal? The company is a big player in a market you never addressed before. Your current product does not do what they need but with a few extra efforts from the development team, you could. This is too good to pass up. The sheer excitement of having found the next big market for your business…
One deal does not make a trend
Entrepreneurs should never let anecdotes run the business. Yes these one off deals can be exciting and very profitable on an individual basis. But does this mean that you just entered a new market. As an example: if you are building a software for architectural design and it happens that one dentist purchases your solution, does this mean that you can stat selling to the dentistry industry? Of course not. While this is an extreme example, anecdotes do not make for real market trends – or new market opportunities.
Can you repeat more than once
Ok lets say that you truly believe that this is a new trend or a new market, how easy would it be to sell exactly the same solution to more than one customer? If you can actually do this many time, then great; perhaps you have stumbled into a new market. If you product needs to have new features for each new potential customer, then you are blind being led by a blind. Step back from the excitement and try to be realistic on your ability to repeat a deal many times without requiring extra product development work.
Adjusting a product to a new market
So if you can’t really repeat the anecdote that easily, you need to evaluate if this is a market you want to enter. This is where Product Validation is a key element in determining if you are on the right track. IF you are able to define a feature set and competitive positioning that will allow you the successfully build a product for more than one customer, then maybe it’s worth the time to investigate.
But in my own experiences, anecdotes are usually just that – nothing more. So you should set a limit on the number of anecdotes you try to nail in a given time; even better if you decline to steer away from your plan. Of course, some people might just call this FOCUS.