For the Internet, it’s been a wild year of tremendous growth followed by dramatic declines. The end of each year is always a time of reflection and planning for the future. Recent turmoil in the Internet industry has left many people ready to abandon ship and find work elsewhere, while others are looking for another online opportunity that will propel them to a new level of success.
The rough road that many dot-com companies have traveled is most likely a leading indicator of a general economic decline, which makes it extremely difficult to predict success anywhere, let alone online.
So, what’s the key to spotting potentially successful ventures early on?
Find a Need and Fill It
One of the most important keys to entrepreneurial success is to find a need in the market, then look for ways to fill that need.
Innovation usually occurs before the market has recognized a need for the innovation. However, many entrepreneurs with technical backgrounds tend to focus on creating answers to questions that have yet to be asked. This makes it tricky to test the concept for a new product before investing years of development and marketing. On the other hand, bringing a product to market without testing the concept means you risk starting a venture that no market will sustain.
The balance between innovation and being too late to a particular market requires a combination of recognition of a genuine need and persistence.
Years ago, some executives thought desktop computers would never be viable. Yet, about 10 years later, companies found they couldn’t do without them because they meet a genuine need for easier access to processing power.
Like other successful innovations, the web was born out of a need to make it easier to share formatted documents with people more quickly. Then marketers found that the web could help meet a long-standing need to accurately target marketing messages. Corporate executives and their IT departments saw that connecting a web server to legacy data processing systems could help solve a critical problem — the backlog of application development projects.
It’s clear that success comes when you find a need and fill it.
Many Internet entrepreneurs thought they were filling a need when they launched their dot-com companies, only to find that the market didn’t think there was a compelling need. This is why a web site that allows people to bid on used consumer products can succeed but a site that allows people to bid on airline tickets struggles.
Because consumers had been looking for something better than a traditional yard sale to turn unwanted items into cash. However, they had not been looking for a way to guess the lowest price that an airline would accept for a ticket.
Listen to People Complain
So, how do you spot a genuine need?
Look for obstacles that keep people from accomplishing specific tasks. Listen to people talk about what frustrates them. By doing this, you learn first hand what they really need and, better still, what they might potentially buy. The more people articulate a specific need, the more you confirm the validity of that need. These informal meetings can also help you define the market for the new product.
So, if you’re thinking about becoming an entrepreneur, remember that when you’ve found a need, you’ve found an opportunity.
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