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The "Review the Market" Lesson is part of the full, Guide for Launching Your Next Big Idea course featured in this preview video. Here's what you'd learn in this lesson:

Paul discusses the importance of market research. The process includes broadly defining your niche in the market to determine your particular audience for the type of app or product you are creating. Targeting too broad of an audience requires a more substantial marketing effort and reduces the likelihood of success.


Transcript from the "Review the Market" Lesson

>> With that in mind as we dive into the first section, which is about reviewing the market really, because you can have this brilliant idea and you can have this really great concept. But actually it can be quite hard if it's already a very crowded market in order to distinguish yourself.

And I could give you a real example of this, that I was working recently with a guy that had built a VPN for people. And it was a really good VPN and it was very, very fast and technically really, really good. But the VPN market is so crowded and with other players that are just pouring millions into marketing in order to increase brand awareness, he just wasn't able to compete with that.

And of course with VPN, a lot of it comes down to trust. Do you think that this is going to be a VPN that is going to keep your data safe, is well known, isn't some corn or something. So that brand awareness was really important. And no matter how great his app was, he couldn't compete with what was going on in the market.

Yeah, go for it, Mark.
>> Jesse online says, this so far sounds exactly what I've been trying to figure out. I've had many ideas I know would be great, but no clue how to review the market, understand my audience and how to really market in the slightest.
>> Yes, perfect.

Great, thank you for that. That's encouraging. Because I was beginning, when you create these workshops, you think, they're actually people that are trying to do this and you get stuck in your own head. So that's really nice to hear. Thank you. Okay, I'll keep going then, that's encouraging.

So why do we wanna do the market research? I mean, I think most of us know that market research is a good thing. It's a thing you're supposed to do, but maybe you're a little bit kind of woolly about kind of the real aims here. Cuz you've got to know your aims before you go in.

I'm not a fan of doing things just because you're supposed to. If you've watched my course on user research and testing, I go on about, well, don't just do testing because that's what you're supposed to do. Do testing because you're trying to get to a particular objective or learn something in particular.

And the same applies here. We need to know why we're doing research. So the first thing is. We need to define our audience, right? Market research provides a deeper insight into the exact niche that we wanna target because we're terrible at that. Example that I've used before in other courses is I wanna create a task gap, right?

Because I don't like the existing task apps. Now that's gray and you might have a unique idea and angle on doing a task app, but a task app could be aimed at a professional project manager that's gonna want one set of things. A stay-at-home mom that's gonna want another set of things or a busy CEO that's gonna want another set of things.

So you have to really be clear on who your audience is and we're gonna do a whole section on that in a minute. But secondly, doing your market research enables us to define the offering, get a clearer picture about exactly what we're gonna build initially. Because again, what happens is we have all these ideas going around in our head, or I could do this, or I could do that, or I could do the other, and that's overwhelming.

And so we end up just picking the things that we're most excited about, which may or may not be the things that other people are excited about. So we need to have a better idea of what actually is worth creating and market research helps us do that. It also is a bit of a kind of wake-up call, really, to knowing what else is going on in the market and identifying some challenges that we'll face, because you will face.

I remember building an app once and I honestly believed that there was nobody else doing it, right? And that this was a completely new thing. And it was only, as I started to talk about it publicly and put it out there, people started to go, you mean like this?

And it's like, yeah, do and then somebody else goes, you'd be like this other app. And before I knew it, there was three or four other apps that did exactly what I did. And it was like, no. And it's not like I hadn't Googled, but it wasn't enough.

And also it helps us to establish our strategy. It'll help you to know how you wanna get to market and how you're gonna reach people and all of those kinds of things, because the scary truth is that out of those 90% of companies of startups that fail, 42% of them fail because there's no market need.

Now, no market need is a bit of a vague term. I mean, what does that mean? But basically it means not enough people bought the thing, right? Or there wasn't enough demand out there for it. So the big question is, well, how do we do this? How do we approach our market research?

Market research, yes, there are specialists who specialize in market research. And I'm presuming within this course, that if you're sitting watching a course like this, you're not trying to launch a product for, I don't know, Amazon here, right? This is you with your big idea and you're not backed with massive venture capital or a huge company or anything like that.

So you're not about to hire a market Rieseberg Search specialists. We wanna talk about stuff that you can do it yourself, not have a whole organization do. So the advice I'm gonna give is within that premise. So the very first thing I would encourage you to do is very broadly define your niche.

What that niche is, is gonna be kind of defined by a couple of things. Firstly, the type of offering that you've got, right? So obviously if you're creating a, I don't know, a recipe app, then it's not gonna appeal to people that never cook for themselves. So there will be some automatic kind of definition going on there.

But also you might wanna think about a particular audience that you want to initially focus on when you initially launch your product, okay? Now, I emphasize the word initially several times there and there is good reason for that. A lot of products or SAS apps or whatever we wanna call them could have quite broad appeal, okay?

A task app is a great example of that, there's pretty much all of us need a task app to some degree, okay? But don't get into that thinking to begin with and it's easy to do because you start getting excited and you go, these people would find it really useful as well and these people would find it really useful.

And that is a problem. You want to avoid going too broad with your audience. The smaller your initial audience, it feels counterintuitive. But the smaller your initial audience within reason, the increasing likelihood of success and I'll tell you why. You have a little pebble of marketing effort that you can put in, right?

You don't have a multimillion pound marketing budget. This is tiny little pebble, imagine that. And if you throw it into the ocean of everybody who might potentially be interested in your app, it'll disappear and it won't leave a ripple, right? But if you take that same little pebble and throw it into a tiny little puddle of a small group of people, it will create a lot of ripples and a lot of effect.

So to bring that analogy down to actually something practical is for somebody to express an interest in your product or service, they can't just hear about it once, right? If you're subscribed to front end masters which obviously you are if you're watching this, think about how many times you heard about front end masters before you paid.

The chances are it was more than once. You didn't just see it but maybe if you're flush with cash or your boss pays for it, right? But if you are paying for it yourself, the chances are you saw it and thought, that looks quite interesting. Okay, I'll come, and you go away and you think about it and then maybe you saw, I don't know, some other person you respect was on it.

Or maybe you saw an ad somewhere else, or maybe you saw a blog post that they'd written, or a social media clip or whatever else, and you heard about it a few times and then you thought that kept reminding you and then you bought, right? Or maybe, you heard about it and did buy it the first time because somebody recommended it to you, okay?

And all of that happens within a small community. So in other words, if Frontend Masters tried to appeal to everybody and had every kind of course in the world, it would need a massive marketing budget to reach all these different audiences all the place. But because they just focus down on developers, it means that they can make sure you've heard of them multiple times because it's a relatively contained group of people, which only go to so many places.

But secondly, there's a good chance that word of mouth will kick in cuz developers like to talk to one another or recommend stuff, so it amplifies your marketing message as well. So, does that make sense of why you wanna go in? Yeah, go for it, Mark.
>> Yeah, just comment that, people think that the Internet is broad so I should go, I can reach anybody, but really it's the ultimate like niche machine if you think about it.

It's like the more targeted, if you're like, I'm going after this very specific person because they have a very specific need. And I know that the better audience, you better the audience, the more you're able to speak to their very specific needs.
>> And you might think the audience is too small.

You might get into this mindset of like, well, if I just go for, I don't know, Ruby on Rails developers, that makes me really outdated. Is Ruby on Rails still trendy? No, it's all right. We'll go with Ruby on Rails there. If I just go, are there enough of those, but yeah, of course they're, right?

You can support business based on that. I should have gotten even more niche. Shouldn't I, really? Yeah, go for it.
>> [COUGH] We're hearing that Sam Altman would tell people at Y Combinator to now go for a large broad audience but instead find a select group of people who are passionate about the product that you are selling.

>> Exactly yeah.
>> They would help you do your marketing.
>> Yeah, and they really will. If you can get a small group of people that are really into it and you're listening to them and you're interacting with them and stuff like that, they become your advocates and they do a lot the hard work for you

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