Part of establishing product-market fit is establishing pricing-market fit, which is how willing are customers to pay for your solution. Although pricing is a number, it is more of a gauge of the value of your product to your customers. So, price research should be done throughout the early stages of a company not just done once around an MVP launch. If your product doesn’t provide enough value, it might be too late to make adjustments.
How do discover pricing? User research around pricing takes practice. You can’t directly ask a potential customer what they would pay for a product or specific feature. You can inquire about other products they use and listen for commentary about their relative value. If you are interviewing users instead of buyers, be warned that they likely don’t know the cost of the products they use. Proxies for price research include understanding thecharacteristics of the pain points. How severe is the pain point (e.g., time and effort)? If severe, what has impeded a remedy? How does the pain point compare to other pain points?
Asking abstract questions can be illuminating. It is fair game to ask how likely they would be to purchase your product given some scale. If you aren’t getting extreme opinions, then this might be a yellow flag for demand. Asking what features are most important is not likely to yield major insights. Create sets of a handful of features and ask users to identify the most/least important features of the set. This will provide a glimpse into the more valuable features and help prioritize development efforts.
While you are doing user research about potential solutions and pricing, it might help to learn more about the target market’s purchasing decision-making process.
Remember, you are creating the processes necessary for your business to scale. The size of the business — a lemonade stand, food truck, storefront — is less important than laying the foundation for the next phase of growth.
Part 1 of this series can be found here.
Part 2 of this series can be found here.
Part 3 of this series can be found here.
