Making What You Want Can Be Sound Product Planning

2022-09-27 original Startups

Product planning can broadly be organized into two approaches: the “market analysis type” and the “needs-first type.”

This method observes market trends, breaking things down into how many people want what kind of thing, and how much business opportunity exists given that supply-demand balance, and so on. This is widely understood as a very common approach. With this method, pricing and which markets to enter become very clear, and it’s easy to build a strategy, so most companies adopt this approach. A major advantage of this approach is that it’s highly reproducible and can easily be extended or applied elsewhere, but it has the drawback that anyone doing it will arrive at roughly the same result. (In other words, competitors reach the same conclusion too.)

This is the approach of “just make what you want, no matter what!” It seems reckless at first glance, but it actually contains a lot of insight. “Does a truly solitary eccentric even exist?” Everyone is influenced by the market. Information now overflows both in the streets and on the internet. There’s no avoiding contact with it. Even someone who thinks “I’m a solitary eccentric” is, to some degree, subject to information bias from popular trends, reputations, friends’ opinions, advertising, and so on. So you could think of it the other way around: someone who believes “I’m an eccentric” is precisely the kind of person who can propose something “just slightly off from normal,” which may let them get ahead of rivals and increase the chance of creating something that matches market needs.

Someone once made this comment about online posts and slander: “After all, it’s just the view of one in 10,000 people. But Japan alone has 100 million people, so it’s possible for 10,000 of those one-in-10,000 people to gather. If 10,000 people gather, you really can’t ignore them anymore.” This was a comment about what’s known as “2channel.”

Interpreted positively for product planning, this means that even a proposal that not a single person inside the company (out of, say, 10,000 people) agrees with might still have 10,000 supporters out in the wider world (100 million people in Japan alone). If there really are 10,000 users out there, whether it becomes a business is just a matter of how you approach it. Take a global approach, and you might draw in even more people.

Today there’s a very effective way to prove this kind of “needs hypothesis”: crowdfunding. “I desperately want this myself, but I’m not sure if there’s really demand in the market, and if there is, how many people would actually support it—so why not try crowdfunding first?” In recent years, using crowdfunding as part of this kind of research has become very common.

This is just my personal view, but I feel that plans built through the needs-first approach have a characteristic that market-analysis-type plans don’t: the central figure, the proposer, rarely has their spirit broken. Market analysis simulations often produce different results just from slightly tweaking the initial conditions. But a personal feeling of “this is what I want!” rarely changes. When you show a plan to various people, they often find fault with the analysis method or approach. You might find yourself thinking, “Ah, maybe that’s true.” But if you stay honest to your own feelings, it doesn’t matter what others say. I think the needs-first type more often manages to carry an initial concept through consistently.

It’s difficult to argue which is better or worse, but if there’s one thing I can say, it’s this: strongly feeling “I want this!” or “I want to make this!” doesn’t actually happen all that often, so that feeling is something you should treasure.

The content of this post is an excerpt (original text) from the following book. If you’re interested, please get a copy.

The Shape of a Happy IoT Startup

Originally published in Japanese at https://clazytech.com/2022/09/1218/. Translated with LLM assistance and reviewed before publication.