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Finding Product/Market Fit for Enterprise Apps

  • by Shantal Erlich
  • Posted June 5, 2017
  • APP MARKETING

The enterprise app world tends to be a tough one to crack.

For starters, it’s never easy to create an enterprise-grade product. They are inherently expensive and are required to meet exacting standards.

Secondly, you need a very convincing story as to why any enterprise should now buy into your new app. Enterprises tend to be like large, slow-moving machines. Even a seemingly small change can involve a lot of hours and money spent on not only the product, but any setup and training.

For these reasons, one of the most important things you can do before investing a whole lot of resources into developing a new app is to establish clear product/market fit. There are many horror stories of failed apps which didn’t put the time into finding the right fit in the first place.

Here’s what enterprise apps should consider:

Establishing Product/Market Fit

The classic interpretation of product/market fit states that you create a product which is meeting a need and solves a clear problem for the user. Engineers often think of it in terms of delighted users, plenty of word-of-mouth traction, and a sleek product that is a joy to use.

There’s a lot more to it when you really dig down. You might think of your product as the app that you build, but to the target user, what is it really? To the client, it’s not really that thing you build, but the benefits that you sell.

“People don’t want to buy a quarter-inch drill, they want a quarter-inch hole.” – Theodore Levitt

So what is it that you’re really selling? That’s what a true fit is going to come down to. For example, if you sell an enterprise grade CRM, you could say that you’re selling better relationships, easier management or quicker timeframes. Whatever it is, it has to be compelling to convince an enterprise to go through the process of introducing a new app.

Know your market – get our quick research tips here

Your Market

It’s obviously very important to think about the end user of your app and how it will be helpful for them, but in the case of enterprise software, who are you actually “selling” to? Most often, the person who is in charge of the purchasing decision is not in fact the end user, so when considering your market, you need to think about the purchaser and their preferences.

Even Facebook isn’t really marketing to their end-users. Who is it that they make their money from? That’s right, the advertisers. Therefore, this is their real market.

An enterprise level CRM app isn’t being purchased by the customer relations or sales teams who use them, but by a head of department or General Manager. Your product/market fit is about selling that “quarter inch hole” to the person who needs their team to drill them.

What are their goals going to be? For most enterprises they will include things like:

  • A tangible return on investment.
  • Low-friction to implement.
  • Ease of use going forward.
  • System continuity over time – no excessive bug problems.
  • Streamlining of current processes.

Finding Product/Market Fit

Before you invest time and money into developing a new enterprise app, a wise course of action is to do some research to determine whether you will have a good product/market fit. There are a few different strategies and preferences for doing this, but the most important thing, no matter which methodology you subscribe to is to begin with the “market” (the purchaser) and the end user in mind.

Adam Wisniewski wrote about avoiding building a product that nobody wants for AgileThought. He suggests beginning with three questions just as a baseline:

  1. Do I understand the problem my customer/client/user faces?
  2. Is the problem prevalent or large enough for people to need a solution for it?
  3. Does the proposed product or service solve that problem?

If you can answer “yes” to these questions, it doesn’t necessarily mean you have product/market fit for sure, but it is a great start for further research. Product validation is an important step and might consist of activities such as surveys, focus groups and interviews of target customers.

Lean_methodology

Will “Lean” Methodology Work?

One of the key differences between enterprises and smaller, scrappier startups tends to be that the larger companies can’t afford to take the “fail fast” approach that a more agile startup might be prepared to take. You’ve already got a reputation that you need to protect, you’ve also probably got a chain of approvals to go through which means you can’t just go from a napkin drawing to development in the space of a few days.

There are still aspects of lean methodology which can be applied to create a more effective enterprise app.

Firstly, lean methods begin with the customer too – what is important to them and how will your app address those things?

Secondly, you can map out the flow and value stream for your app as any lean startup would. This allows you to “trim the fat.” Which features are not adding essential value? These are the ones to slash first, so that you get down to a core offering that is based on critical need.

You might try testing an MVP by launching internally or choosing a small segment to beta test with first. These things are still doable within an enterprise environment, allowing you the space to be more agile.

Common Product/Market Fit Mistakes

The aim is always to establish a clear product/market fit prior to app release which will lead to throngs of enthusiastic users, but the ultimate proof will always be in obtaining actual paying customers. There are countless products which have been launched following extensive user surveying and testing, only to flop spectacularly. Sometimes, what the customer says they want and what they are prepared to buy just aren’t the same thing.

That being said, you can at least be as well-prepared as possible by understanding some of the common mistakes companies make when it comes to product/market fit:

  • Not spending enough time talking to the end user. Some enterprises have spent more time talking to product owners and internal stakeholders than the people who will actually be using the product.

  • The established need is not burning enough. Companies have other priorities before they get to whatever it is you’re solving. This might also be the case if your product is just too “niche.”

  • You’re not distinct enough from key competitors in a large market. If this is the case, you may grow some users, but the wider market already knows about the competitor products and they won’t be buying if you don’t have some kind of clear advantage. You’ve got to know and understand competitor products too; some categories are becoming very crowded with options.

  • Not considering the purchasing processes of your market. Many enterprises have people employed whose job it is to negotiate with vendors. If your delivery mechanism doesn’t line up with how their procurement department purchases, you won’t have a fit.

What are the best ways to research your market? Get our quick guide here:

Have You Found a Fit?

Finding product/market fit for enterprise apps should be taken as a process. Most enterprise developers can’t afford a “fail fast” approach so need to have done the work early to identify their market and create a product which keeps their brand reputation intact.

Part of the challenge is that you need to understand what exactly it is that you’re selling and who you’re selling it to. Most of the time, the end user is not the purchaser of an enterprise app.

Establish a clear need, know your market and importantly, know where you fit in terms of any competitors. Product/market fit isn’t an exact science to establish before launching, but research beforehand will help.

Building an enterprise app? Koombea can help. Talk to us today about how.

 

Shantal Erlich Digital Brand Coordinator

Digital marketing professional, focused on social media strategy. Passionate about content creation and building relationships in the digital space.

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