What is evaluating ideas and opportunities?
Evaluating ideas and opportunities in assessing and determining if what seems to be a good business idea is a real commercial opportunity. The process is excellent in keeping your focus on essential inventions and challenging your ability to turn raw ideas into opportunities.
Idea vs. Opportunity
Idea and opportunity are different terms. An idea is just a product concept that could make money, while an opportunity is a commercially proven time and situation to apply a source of income. The difference between an idea and an opportunity is whether;
● You can afford to develop it and get it to the market.
● Customers will buy it.
● You will make a profit from its sale.
● There is competition for the product.
How to Evaluate Ideas and Opportunities
In product management, business opportunities arise regularly. Deciding what is worth trying is a challenge. The process of evaluating ideas and opportunities comprises these simple steps.
Identifying Market Size and Demand
Market size is a crucial factor to consider when evaluating a business opportunity. Market research shows the need for a product in the market. Some product ideas sound good in theory, but they have no real need in the market.
Whether starting or expanding your current business, make sure the product is in high demand. You need to assess your value proposition and target market and understand your audience as they are your future customers.
Existing relationships with future customers save a lot of time and money. If there are no existing ones, then they must be created. Product management should run parallel to your audience’s needs, so you must learn as much as you can by developing healthy relationships with them. Interact with your audience to understand if your product idea appeals to them and how you can better it. This ultimately turns an initial idea into an opportunity to explore.
A prototype is a snapshot of the product that helps product managers make the next decision. Prototypes should represent the product idea, whether it is just a sketch on paper or a physical model. Product managers can obtain customer feedback and alter the design to reduce business risk.
A product idea would be less worthy if prospects are not willing to pay your projected price. Evaluate the risk vs. reward to determine how risky the opportunity is and if it is worth trying. Also, the market should be prepared for the incoming product. The idea may be great, but if consumers are not ready for the product, it may be hard to turn it into a successful business opportunity.
Releasing an MVP
A Minimum Viable Product(MVP) is a product version with a good set of key features. The main goal is to test the product idea at the lowest possible cost. It also allows product managers to monitor user interactions with the product and apply the knowledge to better the concept.
Going through evaluating ideas and opportunities saves product managers time and money. Is the idea a real opportunity? Sometimes the answer is no. This signals product managers to leave the concept behind and focus on developing the next great idea.