We love talking through new product ideas with our clients. We thrive when we help facilitate discussions with our clients and support them in strategic thinking about the challenges their product is solving and the basic needs of their target users. In particular, we talk through a lot of ideas for two-sided marketplaces.
A two-sided marketplace is a platform that has two distinct user groups which provide each other with network benefits. These type of communities are great because they not only connect the two user groups but they allow for their goods and services to be transferred more easily, reducing friction compared to other options that are available. An example of this could be a platform that connects available dog walkers with individuals looking to schedule dog walks throughout the day.
In saying that, there are a few variables that should be thought through to best determine how to support these audiences, and what scale the business will need to function to be successful. By understanding these variables, you can establish sound targets for our first product release, and identify when your product will be generating revenue that can power the business and future product iterations. In order to share what we have learned at Borne and the product ideates, we will discuss points that we refer to when working with companies in the early product development stage. At a high level, we work together to think through the basics: user needs, platform goals, competitor differentiator, and success metrics.
Our team do not have to have all the information on day one necessarily, but spending some time thinking through these variables and identifying where we need to learn and expand goes a long way toward making sure we are building the right product for your target users. A perk of this approach assists in building a larger picture and begin to put together the full landscape for investors. This week on The Launch Base podcast, we discuss the importance of realistic projections based on your MVP so having a rounded picture of your product would greatly benefit your product and investment journey.
Build your foundation
To get started, our team will spend some time discussing with you the origin of your product idea, what information is known about competitors, target users, and the overall market. Just remember, it is not critical to be an expert but there are some benefits in thinking through the pain points, industry, and players in the space to help understand where your product fits in.
Specifically, when building a product that has competitors in the space, it is important to think through how you can set your product apart. It will not be possible to build the entire product your competitors have spent years developing, but it is important to determine what tasks could be done better:
– How did you come up with your product idea?
– Who are your competitors?
– How would your product fit in the competitive landscape?
– What team knowledge do you have in this space?
– What assumptions could you be making?
– Does your product idea introduce workflows that work cheaper or better/ a mix of both?
Understanding your users
The beauty of a two-sided marketplace is providing value to two distinct audiences and permitting them to reach each other effectively through the platform. Understanding what drives and challenges each audience helps us establish a priority for the feature set.
Your product should help both buyers and sellers reach their desired outcome in a way that is better than existing options. For example, your product platform could allow your users to complete a transaction quicker, be easier to use and give them higher confidence in the outcome. An additional benefit of building out this marketplace is that both groups can tap into a larger pool of options. Buyers are able to connect with more sellers, and sellers have more options available.
So it is now important to ask the question, “Who are your two customer audiences? (Seller and buyer) “
You should ask yourself the following questions for each audience:
– What research have you done with your target audience?
– Do you have access to these communities?
– What are their pain points?
– How are they working through these pain points?
– What is motivating their behaviour?
– What are the expected frequency of transactions?
– What is the ideal seller/buyer ratio?
– How will you keep them coming back to your product?
Now that we have a sense of who you are building the product for, we can use that knowledge to layout the prioritisation of your product features. It is easy to get swept up in the excitement of all the possible features. But take a breath for a second. At this early stage, it is important to determine what will have the greatest impact balanced by development and design effort.
Completing critical thinking and prioritisation exercises like this enables us to outline a roadmap that uses your initial investment wisely and gets the most out of an MVP. Thinking through specific prompts helps us uncover our riskiest assumptions to bring into a product design sprint. This will also be helpful in thinning the tech stack for MVP by leveraging third-party solutions to get something into the hands of your users, sooner.
– is the most important to your user audience(s)?
– brings the most revenue into your business?
– supports engagement and re-engagement?
– supports user audience growth?
– sets you apart from competitors?
– needs to be custom-built?
Laying out the basic inputs goes a long way in determining what target audience size we need to be successful as well as ensuring the value proposition is sound for both audiences. So determining if the effort and the potential cost of being on your platform is lower than the value they will receive?
Are you looking to talk through your product and ways we can support you?
Drop us a message and we will be in touch!