Revenue Enablement: Establishing a Good Product Market Fit
A Product-market fit is defined as a business's ability to create value in new or existing markets. When a business has a product that can be applied in many different ways by many different people, it has a higher probability of success. It doesn't matter if that business is a consumer product or a capital item like an aircraft.
It’s Simple: The products must be relevant, must be useful, and must solve a problem.
A successful business becomes scalable when it ramps up its sales effort, develop and implement a marketing strategy, develop and deploy product teams, develop new roles, and recruit new skills.
For example, if I had an excellent product for building shelters for underprivileged kids, and if I could apply this same concept and do it better than a more established market leader in the same market niche, we would have a perfect market fit.
What kind of products must a business have to be called a "good" business? Well, pretty simple, the products must be relevant, must be useful, and must solve a problem. The definition of a "good" business, therefore, becomes the one that can make more sales in the targeted market segment over its competitors, who has the most efficiently developed technology, who has the best management system, who can deliver new products on time, who has the most extensive customer base...the list goes on.
Market Definition of Product-Market Fit:
A market definition for Product-market fit is a potential market opportunity with a possibility of future sales growth. The Product-market fit has to be consistent with the business's resources and ability to exploit the market. A company can't sell the same thing in every market. If it did, it would fail to make any profit. If it sold the same thing in every market, it would become boring, repetitive, and pointless.
The concept of product development is how a company defines its product's market fit and decides on the right strategy for product development. Usually, a company first defines a target market, sees potential problems or challenges that the product might face, and then implements the right strategy to overcome or reduce those challenges. This is a long-term strategy that results in increased profitability and helps maintain and grow the company's base of customers.
Short-Term Iteration & Development:
The other way of looking at it is to look at product development as a series of short-term strategies that lead to market penetration, customer reach, and customer satisfaction. These strategies are implemented until the market is adequately saturated or until a problem is fixed, or a solution is made available. In many cases, companies use multiple strategies simultaneously to achieve these results. A product development company is usually involved in the process from the beginning to the end to ensure a successful outcome.
A company needs to determine its product-market fit by understanding the market itself. Doing this helps the company design a strategy to effectively address its unique selling points (USP) and eliminate any disadvantages or perceived problems in doing business. This includes determining who the target market will be, how competitive the product is, and what type of people are likely to be interested in buying it. A product development company can help a company to define its product-market fit.