Millie Marconi is an avid startup enthusiast and the co-founder of KnowGood Digital, a reputed data-driven digital marketing agency for socially-minded businesses. Marconi is the agency’s Head of New Business and helps ethical businesses find their competitive advantage using evidence-based digital marketing efforts.
The founder of multiple businesses, she knows first-hand the ‘agony and ecstasy’ of running a business and offers readers this simple test on how to quickly validate their business idea: commercially viable, or hobby?
The era of the #bossbabe, #girlboss and #ladystartup has encouraged more and more women to roll up their sleeves and embrace the exciting (but daunting) role of being an entrepreneur. And why shouldn’t they? Pursuing your passions and starting your own business is more attainable than it has ever been before.
The decision to be your own boss and start a business venture comes with caution.
It’s easy to get suckered into the dreams of fame, fortune and fulfilment, but forget the critical first step: is the idea actually commercially viable?
A nice idea is all well and good, but if your assumptions are wrong and the market doesn’t want it, you don’t have a business. And when things don’t go as planned, that dream can quickly turn into a nightmare, putting significant strain on your relationships, mental wellbeing and health.
Without demand, you have a hobby, not a business. Unfortunately, a hobby isn’t going to pay back investments and bring in an income that supports you. But luckily with the help of some digital tools at everyone’s disposal, you can easily test your idea first, before launching your business.
Validating your idea
Data is about to become your new best friend. I know data isn’t sexy, and the importance of data and analytics is sorely missed in the #bossbabe starter kit, but it is critical in pushing aside assumptions and introducing evidence.
For any new idea, I always suggest starting with Google trends. Very quickly you can plugin keywords that relate to your idea to get a good indication of interest. If you want to take this a step further you can also use Google’s keyword planner to get actual volumes on how many times people search for these keywords in different geographies and even how competitive they are.
This exercise will give you a rough indication of market size and whether it is growing.
If the market for your business idea looks promising, you can then use technology to test it. Whilst there are innumerable ways to test a business idea, the approach I like is to build a simple landing page website, that encapsulates the idea succinctly.
You don’t need to get bogged down into building the perfect brand or getting everything just right.
This exercise is about bringing the idea to life in the quickest way possible. You should also install digital tools like Google Analytics and Hotjar so you can analyse how potential customers interact with your site.
It’s then a case of putting a small test budget towards ads – be they Facebook or Google, to drive some traffic to the site. What you’re looking for are signals from your potential customers that the idea is a goodie. Things like click-through-rate from ads, time spent on your site, and sign-ups or pre-orders all provide you with various data points in making an informed decision about the market interest. Based on these insights, you can make an evidence based decision about your idea’s potential as a business.
Now of course, even with the strongest of signals, it doesn’t mean your new business is immune to failure as there are a lot of moving parts that need to align to create a successful business.
Testing will ensure that your ‘good idea’ has the reinforcement of hard evidence, giving you the best chance of success.
As an advocate for women in business, I wholeheartedly encourage more women to pursue their business dreams and look forward to seeing more and more women founding evidence based businesses in the future.