Product idea validation through an experimental approach

Most new ideas fail in the market — even if competently executed. — states the Law of Market Failure formalized by Alberto Savoia, innovator and entrepreneur, former Google’s Innovation Agitator and lecturer at Stanford University. It’s been proven by many research studies on the success (or failure) rate of startups, and it’s not big news.

Now, you might be wondering — what can be done to avoid said failure? Luckily, there are methods and techniques for Product Idea Validation, as we explained in the following article about our approach to the matter.

In addition to that, I wanted to talk about the term that, although it sounds similar to commonly used prototyping, seems to be rarely heard in the product development industry — that is: pretotyping.

Initially, the term “pretendotype” was coined by the aforementioned Alberto Savoia and was his way to describe what he learned from observing methods used by a number of innovators. Their natural approach to exploring product ideas was to pretend or imagine the intended functionality — hence the name pretendotype, later simplified to pretotype.

To sum up:

Pretotyping is a set of tools, techniques, and tactics designed to help you validate any idea for a new product quickly, objectively, and accurately.

The goal of pretotyping is to help you make sure that you are building The Right It before you build It right.

How does that work? Let’s take a closer look at some examples:

Pretotyping can help validate an idea for a single feature by using the “Fake door” method. You might have encountered it without even realizing it.

In a world of digital products, the fake door can take the form of a landing page, CTA button, in-app notification, pop-up, banner, or even a product video or ad. By measuring interactions with a fake door element, we can test the interest of potential customers.

Imagine you’d like to introduce a newsletter on your company page. By adding a fake door button, you can test that idea and gather feedback without actually writing a thing. This doesn’t mean that the button should lead to nowhere. Be honest with your users, let them know that you’re considering working on this feature, and thank them for their time. You may want to offer a small incentive, such as early access to the said newsletter.

Overall, it’s a good tool to test the waters before committing to costly development.

Pretotyping methods allow testing a whole business idea beforehand. Another example, one-night stand technique includes offering a sample version of your product or service on a very limited time basis to test if there is any interest before making any long-term commitments. Consider Airbnb as a primary example. To test their business idea, Airbnb founders created a simple website offering an alternative to hotel rooms: An air mattress + simple breakfast for $80/night (in their apartment in San Francisco) Surprisingly, 3 people signed up on their first night. That experimental approach leads to worldwide success.

So, how does one do that? Here are 5 steps to apply the Pretotyping methodology:

Step 1: Isolate the Key Assumption

A key assumption about your idea is the one statement that, if proven false, means the idea is not valid. You’re about to test that one.

Step 2: Choose a Type of Pretotype

There are many methods of pretotype. Choose the one best suited for testing your key assumption. Fortunately, Alberto Savoia shares a Quick Guide to Pretotype Types, that may come in handy here.

Step 3: Make a Market Engagement Hypothesis

Every experiment needs a hypothesis to prove true or false. Decide what result will mean success for your idea. It can be as simple as:

X% of Y will do Z

X% of monthly visitors will click on Newsletter Button

A solid hypothesis takes the guesswork and opinion out of testing.

​Step 4: Test Your Pretotype

Ah, the most exciting part — the experiment comes to life! It’s time to put your idea out there. Watch closely, and gather data and feedback.

Step 5: Learn and Refine

Analyze your results. What did you learn about the idea? Is the hypothesis true or false?

If the hypothesis is true — congrats, consider your idea validated, there are great signals that potential customers are interested and see the value of your product.

If it’s false — congrats as well, you just saved tons of money by not developing this idea in the first place, but chances are you learned something about your potential customers, and you’re ready to generate a bunch of new ideas.

Key takeaways

By taking an experimental approach to your ideas, you can start testing at the earliest stage of development.

Pretotyping methods are cheap and allow validating many ideas in a very short time, to help separate the good ones from the bad ones. Ultimately, pretotyping can mitigate the risk of investing in a project doomed to failure.

Fail fast and learn faster — with every quick experiment comes knowledge and inspiration for the next one.

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iteo is an international digital product studio founded in Poland, that helps businesses benefit from technology better. Visit us on www.iteo.com