Today let’s talk about the theoretical grounds of product development. If you missed it, last week we published a big article on the basics of this approach (click the button) There’s one more thing we’d like to cover.
One of the key features of product development is hypothesis testing. It’s crucial when we look for a new business niche or figure out the direction of its development.
Our experience shows there are four levels of hypotheses: market hypothesis, marketing, product and team one:
1. Market hypothesis
We research the market: its size, shares, growth factors, etc. The data helps understand whether this market sphere is even worth the trouble of winning it. Also, we get information on the audience’s needs and figure out a way to cover them.
2. Marketing hypothesis
The previous level gave us a growing niche to conquer; now we need to understand what to sell there and how to do it. This hypothesis is about finding the perfect marketing mix and the key message that would bring sales growth.
Conversion rate optimization during the product development process is a way to further experiment and develop the product. Marketing efforts bring the clients; clients provide data on whether the product delivers values to customers and brings profit to the business.
3. Product hypothesis
Earlier we found a potentially profitable market and the first customers. Now it’s time to scale this experience. This means we need to change the customers’ behavior. This hypothesis cannot be fully outsourced to the development team; delivering value is always a collaborative process.
4. Team hypothesis
Creating hypotheses is not enough. The business needs to find sources of competence, i.e. a development team that knows how to test hypotheses. These people can facilitate the product development process, because they are skilled at this and can dive into the business’s activity fast.
Who is in charge of forming hypotheses?
At JetStyle, we believe that it is irrelevant; it can be either the client or the developer team.
The biggest challenge is the testing itself, along with making valid conclusions and assumptions, and integrating new features into the business process. The ultimate aim is to ensure speedy growth of the client’s business.
Get in touch if you have other questions about product development or you want to discuss whether this approach can be used for your business. Sign up for a free consultation via firstname.lastname@example.org