How to Validate a Software Product



Agile Product Development

A big risk of creating a new software product is building something no one wants; something no one will pay for. You could spend a lot of time and cash only to realize some fundamental flaw in the product that prevents it from ever becoming a success.

This problem is especially troubling if you intend to release a product that doesn’t have any equivalents in the market, or a product that intends to disrupt existing markets.

Fortunately, you don’t have to release a product blindly. With product validation, you can confirm whether your product has a chance to be successful. Sadly, many organizations skip this step because it requires resources of its own.

In this article, we’d like to talk about what product validation means and how to do it.

Why You Should Validate Your Product

When you develop new products, you’re forced to make a lot of assumptions. If too many of those assumptions are wrong, you’ll end up with a product that no one wants to use or buy. Countless failed products are based on whatever their creators found interesting, rather than a solution to a real problem.

Identifying incorrect assumptions early is the only way to protect yourself. If you catch your bad assumptions early enough, you can pivot to give the product a better chance. Or, in the most extreme cases, you can abandon the product, thereby saving yourself time and money.

Validation is the process of testing those assumptions. It forces you to expose the product to real users to determine if your idea is any good. Ultimately, validation will help you resolve three assumptions:

  1. The problem - Is there a genuine problem customers are facing that needs to be solved?

  2. The market - Are enough customers willing to pay for the product?

  3. The product - Does the product actually address the problem?

Validate a software productImage: Mind the Product

You may think you have a great idea or great technology, but self-validation is flawed. You can’t rely on your own intuition, even if you’re familiar with the market, industry, or customer. You will always be too close to your own product to think objectively about it.

Validation is especially important if you intend to raise VC money. Venture capitalists want as much information as possible that shows the product will be successful and that their investment is safe in your hands. If you can show evidence of validation to investors, you’ll get better reactions and (possibly) a better deal.

How to Validate a Software Product

Remember, validating a product means determining if there’s a problem to be solved, if there’s a market big enough to support the product, and whether the product addresses the problem. You should resolve all three assumptions before starting development.

There are plenty of validation strategies that will help you understand those assumptions, but only four that are impactful.

Step 1: Talk About Your Idea Openly

One of the biggest mistakes product creators make is to keep their idea to themselves. Being secretive deprives yourself of valuable feedback and blinds you to those early roadblocks that other people can see clearly.

For instance, let’s say you have an idea for a social media app. Your first validation step is to speak to someone who knows the space well. This could be someone who works in social media tech, a social media marketing agency, or the owner of similar SaaS. There’s a good chance one of these people can explain some challenges you might face.

Share your idea with everyone. Ask them questions. If someone tells you the idea is stupid, don’t dismiss them. Instead, find out why. Use their feedback to refine your idea. The more you share it, the better it will become.

Step 2: Find and Explore Similar Products

Many people think it’s best to have no competition, but that’s not quite accurate. Existing products that address the same problem as your idea mean someone has already spent the time and money to validate your four big assumptions.

Furthermore, similar products give you an opportunity to study what they’re doing right and what can be improved. If you’re developing a CRM SaaS, for instance, you could look through the complaints people make about your competitor’s products to find ways to create an advantage.

If you can’t find any products similar to yours (addressing the same problem), that could be a sign that there’s no market for your product.

Step 3: Setup a Landing Page and Waiting List

Your next step is to resolve those assumptions by finding real users. “Uh, my product doesn’t exist yet,” you’re probably thinking. “How do I get users?”

It works like this: You build a landing page (or a whole website, if you have the resources) devoted to your product, including a “sign up” button. When they click the button, you tell them that the product is in closed beta right now, but you’re happy to add them to the waiting list.

For instance, trading app Robinhood created a simple landing page for their product before it was available. Email subscribers were used to evaluate interest and create a ready-to-go audience for launch day.

Validate a software product

If you already have an audience (traffic to your website, a social media following, email subscribers, etc.), you can ask them to sign up to the “new product’s” waitlist. But if you don’t have an existing audience, you’ll have to pay to bring interested people to your page. Use paid search and Facebook ads to drive traffic to your landing page.

You can use the waitlist to learn more about the audience, their needs, and the market. This is a big opportunity because these people are struggling with the problem so much that they’re willing to click an ad, read a landing page, and sign up for a product that isn’t available yet.

Reach out to these people with email content. Ask them to reply to your questions. Request time to interview them if you can. They will validate whether your upcoming product will be any good and they can help guide your product development. They’ll say things like, “What I’d really like to be able to do is…” or “I wish I could find a product that…” That’s invaluable!

Will people really go so far for a product that isn’t available? Yes, if the problem is painful enough for them. People will offer all kinds of free feedback, advice, and support if they think you’re working on a solution for them. (The whole crowdfunding industry relies on this phenomenon.)

Step 4: Pre-Sell the Product

The other three steps we mentioned are important, but true validation comes from people actually paying for your idea.

If you don’t think a waitlist is enough validation, consider actually pre-selling the product. Obviously, selling a nonexistent product is much harder than collecting email addresses, but the feedback is more valuable. If a customer is willing to pay money for a product that isn’t available, that’s a pretty good signal that you have a product that addresses a problem and a market that will receive it.

When you pre-sell your product through a landing page or a website, just make it absolutely clear to potential buyers that the product isn't available yet. You could end up with a lot of unhappy people if they expect to start using the product right away.

Alternatively, you can validate your products by reaching out to specific people and organizations who would get the most value from your future product. Explain how you understand their problem and how your product will address it.

Keep in mind that people expect to get something in return for their willingness to pre-buy your product. Sweeten the deal by offering discounted pricing, priority customer service, extra features, or whatever the potential customer finds valuable.

Going Forward

There's no method of product validation that's 100% accurate. There will always be people who will promise that they will buy the product, but never do once it's available. You will even run into people who pre-buy the product and then cancel once it's released.

But validation is a key part of the development process. If you skip this, you risk wasting time and effort building a product that nobody wants to buy. It's better to test your assumptions as early as possible so you can pivot or abandon the product if necessary.