As we continue our series on Business & Entrepreneurship, it is essential that we identify and discuss common missteps that we see some entrepreneurs make.
Recently, one of our associates had the privilege of attending and satisfactorily completing an Entrepreneurship Essentials course at Harvard Business School Online. After doing so, new topics of discussion emerged around business ownership and moving a company concept into reality. (We certainly appreciate the experts at HBS Online for offering needed resources and challenging us to be better!)
So, what is the common misstep? … Drumroll, please… Early on, many entrepreneurs neglect to size their market prior to launching a business. It may seem unnecessary or a “waste of time” to conduct market research as an essential first step. However, doing such work on the front end of a company’s creation could mean expanded success on the tail end, simply because you took the necessary time to get to know your target audience.
It is important that you do not make assumptions about your potential customers. Doing so could result in misshapen strategies and marketing plans that miss the mark altogether. The ultimate result will be that your company has to revisit the market research step that was initially omitted — except at this point you’ve wasted money, time, manpower and possibly damaged your brand in the public eye.
Let’s take a step back. What is sizing the market, anyway?
Once you have identified your passion that you’d like to transform into your independent profession, you should then get a good grasp on your potential upside — or the possible gain in a business situation, transaction or deal. Instead of assuming that the world will love your idea simply because you do, you should instead figure out the total market size for your proposed venture. How many people will be interested in your product or service? Furthermore, of this group, how many people will actually buy or invest in your product?
The true answer to these and similar questions determine your potential payoff or benefits received. This is the best way an entrepreneur can gauge the value of his or her new idea or if the new business venture is worth launching. For a more detailed look at this topic, we encourage you to take the same Entrepreneurship Essentials course at Harvard Business School Online. The knowledge gained was invaluable!
But meanwhile, a word of advice… Creating and launching a business is a distance race, not a sprint. If speed is your only goal, skipping essential steps could come back to haunt your company later, down the road.
Do you have any good “early entrepreneurship” stories to tell? We’d love to hear them! Contact us today at 1-800-793-1391.
