Want to make sure productization is a viable option for your business before you go all-in? Here are 5 methods you can use to validate your productized service idea.
Thinking about productizing your services but worried about taking the leap? Don’t be. Productization doesn’t have to be a risk and you don’t have to go in blindly.
You can – and should – ‘test the waters’ first and validate your idea before you go all-in. That way, you’ll have a better idea of whether it’s going to work out before you give up on your existing service model.
In this post, we’re going to be showing you how to do just that. Here are some different ways you can validate your productized service idea.
Spy on your competitors
One way to find out whether or not there’s a market for your productized service idea is to look at what your competitors are offering. Ask yourself this: how are other businesses in my industry doing it?
For example, if you’re in the graphic design space, look at some graphic design agency websites and see what kind of product packages they’re offering. Have they set up recurring fees? What’s included in each product package?
Try searching on Google for terms like “monthly graphic design service” or “graphic design subscription service”. You can substitute “graphic design” for your business type. (Learn more about productization of design services.)
If somebody else has had the same idea as you, it’s a good sign that there’s a market for it. If you can’t find another business already offering the same productized service, you’ve either struck gold and found a space with no competition (unlikely) or it’s just not a viable business model.
Ask your existing clients for feedback
The aim is to find out if your market cares about what you’re building, and one way you can get an idea of that is to ask your existing clients for feedback about your idea.
Speak to someone you’ve already worked with in the past who might be interested in your new idea and ask them for their thoughts. You can reach out to them via email, LinkedIn, social media, or even in person.
Take note of the feedback they give you carefully and use it to tailor your offer to exactly what your clients want. Don’t just ask them ‘would you have a need for my service?’, also ask them why. This will help to guide your decisions when coming up with your products.
For example, let’s say you’re a content writing service provider and your idea is to productize by offering a fixed-price package of 5 blog posts per month for a set fee of $1,000.
You run this idea by one of your existing clients and they tell you that they wouldn’t be interested as they rarely need more than 2 per month.
The takeaway here is that you probably need to reduce the number of items in the package. Maybe ‘2 blog posts per month for $400’ would have wider appeal.
Reach out to your ideal clients
An even better idea is to speak to the clients/customers you hope to sell to in the future. Start by asking yourself: who is my ideal client? Once you know, reach out to them and ask them for feedback.
The hard part is finding people willing to give you that feedback for free. One method you can use for this is what I like to call ego-baiting. Find ideal customers that are leaders in their industry. Consulting Success recommends using social media and Amazon eBooks to help you find potential contacts. When you’ve found some suitable candidates, send them an email like this:
I’m asking leaders in [industry] about [topic] and would love to feature you. I’m a big fan of your work in [industry] and would really value your thoughts. Do you have 5 minutes to spare to answer some questions for me?
Cold emailing like this might not be the best way to make sales, but you’d be surprised at how many people are willing to give you their opinion if you make them feel like an expert. You give them an ego-boost and in return, they help you to validate your offer.
Create a new landing page and test it with ads
If you’ve already had some conversations with folks and you think there’s demand, you can just get your idea out there straight away.
Create a new landing page on your existing website with your new product offer, then launch a paid ad campaign and track the results. If you don’t see the kind of ROI you expect, reassess your idea. If none of your traffic is converting, it might not be the right product/market fit.
Start small and only invest a small amount in the ad campaign at the start – you don’t want to waste a bunch of money only to find out the idea is a dud.
You could also use split testing to compare two versions of your landing page: one with your existing service model and one with your new productized offer. Which page is converting traffic better and making more sales?
Set up a new standalone site
In some cases, it might make more sense to separate your productized services from your existing service business.
In that case, you can follow the same process as above but host your landing page on a brand new standalone website instead.
Setting up a whole new website for a productized service idea you might not even stick with might seem like a waste of time and money, but it doesn’t take as much time or monetary investment as you might think.
Here’s the basic process that UX designer and researcher Shane Ketterman uses:
- Set up a basic landing page using a service like Launchaco
- Build a logo and use it in the page branding
- Implement a simple payment solution
- Launch your website
- Drive traffic using paid ads (Facebook Ads, Google Ads, etc)
- Look at your analytics and see what happens
Remember, this won’t be the final website, it’s just a testing site, so don’t waste too much time on it. We’re not aiming for perfection.
Your analytics can tell you whether or not your idea has some steam. If you’re seeing the numbers you want to see, you can go all-in. If not, take the site down, come up with a new productized service idea, and start all over again. Rinse and repeat until you find an idea that works.
If you’re still not sure whether productizing is the right choice for you, read our list of pros and cons. You might also want to check out our productization checklist.
Once you’ve validated your productized service idea and you’re ready to go all-in, you can start setting up your new business with the help of ManyRequests, just sign up for a free trial here.