An Entrepreneur’s Perspective: Why “Product-First” is the Winning Approach

Similar to the age-old dilemma, “Which came first, the chicken or the egg?”, many first-time entrepreneurs wonder which should come first, a product, marketing or sales?

The key to launching a successful startup is developing a product or service that people want to use — something that not only attracts customers, but also retains them. A product-first approach is a surefire way to achieve customer loyalty; it involves initially focusing time, energy, and resources on building a viable product, then testing it in the market. As a startup, your primary goal is survival, and emphasizing product development will help ensure that your business is part of the 50 percent of startups that survive past year four. There are a few distinct advantages to a product-first mindset. Let’s explore:

Great products attract great customers
People don’t talk about wanting certain companies to exist; they think about products they wish they had to fulfill a specific need or solve a problem. Apple is a classic example of a product-driven business. Steve Jobs’ team lead with a “build and they will come” mindset, creating the iPod before consumers knew that they wanted it. They then spent the time to market the product for what it was — an innovative new way to listen to music on the go. If you spend time refining your product — focusing on product architecture, functionality, design, and user interface — customers will come naturally.

A well-developed product will naturally attract investors
Let’s face it, attracting good investors isn’t easy. That being said, it’s a lot easier when you have a working prototype, not just a concept with a shiny marketing plan. A minimum viable product (or MVP) should be a very basic version of your product — just enough to show investors that your innovation works. Sales and marketing-first strategies can be hard to prove and expensive. With a product-first approach, you can focus on working to efficiently develop an MVP and refine it through user testing. Then, you’re also ready to hit the ground running when you get the additional resources you need to launch your business.

According to a study conducted by CB Insights, the number-one reason for startup failure is the lack of a market need for their product. By taking a product-first approach, you can refine your prototype to consumers’ needs before ever marketing it to the public.

Stay ahead of the competition by building early
The competitive nature of the technology industry makes it a risky place to market ideas without a prototype to back it up. If the product isn’t ready when you begin marketing to consumers, you run the risk of losing their interest before the product has even reached the prototype stage. By taking a product-first approach, you’re putting your money where your mouth is and can show consumers a near-market ready solution to their problems. In the inception stage of a business, it’s all about building your “beta” to prove your concept first.

A well-developed product will result in a clearer marketing vision
Marketing and sales efforts will be more effective later down the road if you build a product that satisfies the needs or solves the problems of your audience. You’ll have more collateral to create marketing materials, including testimonials, images, demos, and more. Without a product to show, you’ll be selling people on a concept alone. Having a product to display also improves brand awareness and word-of-mouth customer referrals. People are more likely to share a video of a working prototype than a video explaining the concept for a product that could be years in the making.

While there isn’t one cookie-cutter formula for launching the perfect startup, keeping a product-first approach in mind the will position your startup for market success and longevity. At the end of the day, a product-driven organization will employ business strategies that naturally attract customers and investors. It’s all about taking the first step to defining your approach and sticking to it.

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