- William Auwines
Product-Market Fit: Know More Here!
Product-Market Fit: Know More Here!
Every company will always try to create the best products to sell to the market. The rationale is that the best product will be able to attract more consumers so that the product sells well in the market. The more it sells well, the more profits the company gets.
However, does everything rely solely on the product alone? Not. A good product is made according to the quality or quantity of the product and also considers whether the product is in the market you want to sell. With these market considerations, it is hoped that the products sold will not only sell well but also be sustainable.
The compatibility between the product and the market is called product-market fit. Let's read this article further to find out more about product-market fit.
What is Product-Market Fit?
Product-market fit is a condition when consumers in the market targeted by the company buy, use, or disseminate information about the products sold by the company. These activities are conducted in enormous quantities so that the products sold are profitable in a sustainable manner.
According to Marc Andreesen, venture capitalist of Andreessen Horowitz, product-market fit can be interpreted as "looking for a good market with a product that can meet the wishes of that market."
Product-market fit is one of the fundamental processes that all businesses must take. Without it, an enterprise cannot make plans to grow the sales of products. A product can fail to attract consumers in the market if there is no qualified product-market fit.
How to Calculate Product-Market Fit?
Since the measure is about consumer behavior in the market, there is no definite measure in measuring product-market fit. However, Andrew Chen, a venture capitalist, suggested that several indicators show whether a company is heading towards achieving a product-market fit.
Does the consumer segment indicate they will move to the products that the company sells?
Does the consumer segment that refuses similar products have a desire to try the effects that the company sells?
Do consumers accurately associate the company's products with the right and competitive offer?
Do consumers understand the unique differences and values of the company's products?
How do the company's product metrics perform compared to other companies' products?
Based on these indicators, several quantitative and qualitative measures can be used to determine the achievement of product-market fit. Quantitative measures include NPS score, churn rate, growth rate, and market share. Meanwhile, qualitative measures include word of mouth and frequent calls from the media or industry analysts.
Find Your Optimal Product-Market Fit Here!
Product-market fit is a key to successful marketing. With it, your startup will become a profitable and sustainable startup. Do you want to reach it? Send your pitch deck to us!
Achieve product-market fit with Kolibra as your partner!