Using Iteration to Find Product Market Fit
Updated: Sep 18
Ever seen a company pour years and fortunes into a "grand vision" only to watch it crumble like a stale cookie? Big companies do it all the time. They get so caught up in their own brilliance, they forget to check if anyone else actually wants what they're building. It's like baking a five-layer cake when everyone's suddenly gone gluten-free. Awkward.
Think of Airbus, building the especially large A380 while the market was migrating to smaller, more efficient planes. Or Navdy, a navigation company, trying to sell us a $799 heads-up display for our windshields. Turns out, most folks are perfectly happy with their phones or GPS and the device didn’t stay on many windshields. A little market research before diving headfirst into production might have saved them a few bucks (and a whole lot of embarrassment).
The moral of these stories? Rome wasn't built in a day, and you won't become a billionaire overnight either. Even Netflix, the streaming giant we all know and love, started with DVDs. Remember those? They iterated, they adapted, they conquered. They didn't just burst onto the scene with streaming and original content.
That, my friends, is the power of iteration. It's the secret sauce to finding product market fit (PMF).
So, what exactly is this PMF?
Think of it as the sweet spot where your product perfectly scratches an itch for a specific group of people. It solves a real problem, not just one you think exists. And when you hit it, things start to happen. Customers flock to you, stick around, and even tell their friends. Fundraising gets easier, your business grows, and you can finally afford that sports car you've been eyeing.
PMF is measured by the "40% rule". If 40% or more of your customers would be "very disappointed" if they couldn't use your product anymore, you're in the PMF zone. Congratulations!
Why is iteration so crucial to find PMF?
Well, for starters, it lets you test the waters without betting the farm. You don't need to build the Taj Mahal right away. Start with a lean-to, see if anyone wants to hang out in it, then upgrade to a bungalow, and so on. This way, you avoid expensive mistakes like Airbus's A380 or Navdy's windshield woes.
Iteration also keeps you nimble. The market is a fickle beast. It changes, it evolves, it develops a sudden craving for kale smoothies when you're all about the bacon double cheeseburgers. By iterating, you can keep up with these changes and make sure your product stays relevant.
How do you actually do this iteration thing?
Form a hypothesis: What problem are you solving? Who are your ideal customers?
Do your homework: Talk to potential customers before you build anything. Find out if your hypothesis holds water. This makes your first iteration more likely to hit the mark.
Validate, validate, validate: Get feedback on your prototype, your MVP, your early version. Don't be afraid to ask the tough questions. Ask yourself "what would need to be true about this product for it to be a success" and test those aspects.
Refine and repeat: Based on the feedback, tweak your product, your marketing, your everything. Then, go back to step 3.
Read more about how small steps help the Ironman achieve their goals here
Why is iteration hard?
Iteration is fueled by customer feedback and despite the proven power of iteration, many still find themselves paralyzed by thoughts that make them feel they don’t need the customer feedback. Here are some common excuses as to why people don’t get feedback and what they really mean:
1. "I already know what my customers want." (aka The Assumption Excuse)
What it means: The owner is relying on their own biases and assumptions rather than actual data. They're afraid of being proven wrong or having their vision challenged. They might be in love with their idea and unwilling to hear criticism.
The problem: Assumptions are dangerous. What you think customers want and what they actually want can be vastly different. This leads to building the wrong product, wasting time and money.
2. "I'm too busy building the product." or "I'll talk to customers later." (aka The Procrastination Excuse)
What it means: Talking to customers can be messy, time-consuming, and sometimes discouraging. It's easier to stay in the "safe" zone of development, where progress feels tangible. They might be afraid of discovering a fundamental flaw in their product early on. Perhaps they think it is a reflection on them (it is not)
The problem: Building a product in a vacuum is a recipe for disaster. The longer you wait to talk to customers, the more time and resources you risk wasting. You could be building something nobody wants. Customer feedback should be integrated throughout the development process, not just at the end. Early feedback is crucial for course correction.
3. "My product isn't ready yet." (aka The Perfectionism Excuse)
What it means: The owner is afraid of showing their "unfinished" product to potential customers. They're chasing an unrealistic ideal of perfection before getting any feedback. They may be worried about negative feedback damaging their ego. Perfection is "unobtanium" in the product development world.
The problem: Perfection is the enemy of progress. You'll never know if your product resonates with customers until you put it in front of them. Early feedback, even on a rough prototype, is invaluable. An MVP is supposed to be imperfect.
4. "I don't have time/resources for customer interviews." (aka The Avoidance Excuse)
What it means: The owner might underestimate the value of customer feedback or believe the process will be difficult so prioritizes other tasks, often less important ones.
The problem: Talking to customers is one of the most important things you can do in the early stages of your business. It's an investment that pays off exponentially. There are many low-cost ways to get customer feedback - it doesn't have to be hard. A reframe of your thoughts regarding the value vs. the cost may be beneficial.
7. "My target market is too broad/niche/hard to reach." (aka The Difficulty Excuse)
What it means: Similar to the Avoidance Excuse, the owner may feel overwhelmed by the prospect of finding and engaging their target audience, but this is often an excuse not to start.
The problem: While finding your ideal customer can be challenging, it's essential. Start small, focus on a specific segment, and use creative methods to reach them.
8. "I'm afraid of negative feedback." (aka The Fear Excuse)
What it means: The owner is worried about hearing criticism about their product or idea. They might take it personally.
The problem: Negative feedback is actually valuable. It helps you identify weaknesses and improve your product. It's better to hear it early than after you've invested significant resources.
In short, most excuses for avoiding customer interaction boil down to fear: fear of being wrong, fear of rejection, fear of the unknown. Overcoming these fears and embracing customer feedback is crucial for achieving product-market fit and building a successful business
The Takeaway:
Small steps with iteration are the keys to building a successful product or business. Although it may be more difficult or time consuming, iteration helps you ensure your product meets market needs, you spend your money wisely (no new sports car just yet!), and you keep abreast of market needs. Embrace the power of iteration, overcome your fears of rejection or being wrong, and your wallet (and your sanity) will thank you.
Comments