How to Test Your Business Idea Before Launching Your Online Business

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Ever since the internet revolution of the nineties, businesses have been keen to build a website and grow online.

With practically everyone turning to the internet for their every need, it’s never been a better time to start your own online business. But not every business idea can be a success.

Sometimes, no matter how much you believe in your online business idea, it just doesn’t work. Which is why testing business ideas first is so important.

In this article, our experts have laid out the steps you need to follow to test your online business idea before you launch, ensuring you’re on the right path to success.

Market Research and Validation

Before you launch an online business, you need to understand the market you’re planning to operate in. Enter: Market Research.

Identifying Your Target Audience

To test your business idea, you need to identify your target audience. Think carefully about who you think will be your ideal customer. The best way to identify your target audience is to create your ideal customer persona, listing attributes such as age, gender, interests, location, and needs.

Without a target audience, your business idea is doomed to fail from the start.

Analyzing Market Demand

Next up, you need to analyze the current market. Is there demand for your product? And if there is, is that demand already being met by other brands? Without demand you’re going to have a hard time getting your business off the ground.

Google Trends is a great way to work out whether or not people are searching for what your business will offer. If search volume is low, it might be time to go back to the drawing board. High search volume, however, suggests your business idea has legs!

A Google Trends graph showing results for people searching for personalized dog collars
Google Trends is a great way to find out how many people are searching for terms related to your business idea.

Validating Problem-Solution Fit

Problem-solution fit is the idea of identifying a problem and offering a solution. For example, the founders of Airbnb identified a problem, expensive hotel rooms and a surplus of spare rooms in people’s homes, and provided a solution, the ability for people to rent out their spare rooms at accessible rates.

Your online business needs to solve a problem for users… even if they don’t yet realise it’s a problem. Ask yourself, what can you add to a users life? What problem will you solve for them?

Minimum Viable Product Development

A minimum viable product is a version of your product that contains just enough features for customers to use it, in order for them to provide feedback to help progress your business idea.

Minimum viable product development is a key step in testing business ideas.

Defining Your MVP

To define your MVP, think carefully about the essential features of your product and what can come later.

Remember we mentioned Airbnb earlier? When the brand first launched they did so with an MVP: a simple website featuring listings, images, and the ability to book. Additional features such as enhanced search and Airbnb experiences came later once they had intel from customers.

Building a Prototype or MVP

Next, you need to build your MVP. Remember, your product still needs to be viable. It’s no use creating a website with loads of half-finished features. Instead, you need to focus on building a site with completed core features.

Another MVP example is Spotify. The music streaming giants first offered the desktop version, where users could stream music for free, before developing the app that requires users to sign-up to access ad-free music, unlimited skips, etc.

The MVP here, the desktop version of Spotify, was 100% viable and worked fully — it just didn’t have the additional features yet.

Gathering User Feedback

The key part about developing and distributing an MVP is to gather user feedback. You can use this feedback to inform the next steps of your product creation as you work to create your final, finished product.

But how can you collect user feedback to refine your business idea?

  • Interviews and user surveys
  • Focus groups
  • In-app surveys and questions
  • A/B testing
  • Analytics

Getting Online

Once you’re confident that your online business is ready to be put to the test, it’s time to get it online!

Get a Website Set Up

One way to prove whether or not your idea has a chance to take flight is to build a website for your online business.

There are a lot of free website builders in the market right now, such as Wix, GoDaddy, and Square Online that will help you get started.

It doesn’t have to be super good looking, either! We’re looking to test an idea quickly, not submit a website for a beauty contest.

Create a simple product description page, create a few diagrams or pictures of what you want to sell, and include an “add to cart” button which leads to another page.

This other page is what you’ll track to see if people are actually clicking on the “add to cart” button.

Or you could solicit potential customers to submit their email addresses in the website to receive further information on the products. This email function could be a simple contact form which is usually included as a built-in feature on website builders.

Track Your Data

After you have the simple website up and running, don’t forget to insert Google Analytics or some sort of website tracking to it.

Google Analytics is an excellent way to see how many people are visiting your website and where they’re clicking. It’s free, and all you need is a Gmail account.

Advertise Your Idea

Next, place some ads with Google. This is the easiest and fastest way to get your idea out into the internet to gauge how people may react.

Google Ads will show up in Google’s search results page when people are searching for keywords that are relevant to your idea. In any case, you’re the one that selects which keywords visitors have to type in before your ad will show.

This is a very simple test method and you can often yield good insights and information very quickly in a matter of days.

Google Analytics will track what your visitors are viewing on your website and how long they’re on each page for.

Ideally, what you’d like to see is if the visitors are clicking through to the “add to cart” page which suggests that they have some intention of purchasing, or if they’re emailing you to ask you for more product information.

Test Budget and Commitment

Your total test budget and commitment could look something like this:

  • Website cost = Free
  • Time to set up website = One day
  • Google Analytics = Free
  • Google Ads = $50 (depends on how competitive the search terms are and how much data you would like to collect)
  • Data analysis = a few hours

Of course, you can use your own creativity and execute variations of this test, but the test concept in itself is quite simple and it’ll provide you with clues and indications as to whether your business or product ideas have any potential.

Keep it simple, and your potential rewards could be limitless! Looking to sell software? Have a look at our guide.

Conducting Surveys and Interviews

Conducting surveys and interviews is a great way to test business ideas and understand how your target audience will respond to your new online business.

Crafting Effective Surveys

To get the best responses, you need to craft an effective survey. To do so, some of our top tips are:

  • Define the purpose of your survey
  • Make every question count – don’t ask questions you don’t want or don’t need to know the answer to
  • Keep it short and simple – don’t create a survey that’ll take hours to complete
  • Speak your audience’s language – avoid technical jargon and complicated questions
  • Ask targeted and open-ended questions –  avoid anything that’s too closed or biased
Homepage of Survey Monkey website showing sign-up CTA's and a survey example
There are loads of tools you can use to create online surveys such as SurveyMonkey.

Organizing Customer Interviews

Undertaking customer interviews can be a great way to gain a deeper understanding of your target audience, their desires, pain points, and how they behave online.

To conduct unbiased interviews be sure to select a broad range of customers to talk to, avoid interviewing customers who all fall into the same demographic groups.

It’s also a good idea to create an interview script before you get started, listing out the questions you want to ask. Stick to 10 questions or less and avoid closed questions that limit the answers your interviewee can provide.

Top Tip: Diversity is key when collecting customer feedback. Break up your target audience into different demographics and speak to as many people as possible for the best results.

Analyzing Data and Making Decisions

When it comes to testing your business idea, data is your best friend.

Collating Collected Data

Before you can analyze your data, you need to collect it all in one place. Depending on the methods you’ve used to collect your data, you may have multiple different data types to work with.

The most common way of collating data together is to input everything into a spreadsheet, allowing you to accurately compare and contrast your results.

Identifying Patterns and Trends

Once you have all of your data together you can begin to identify patterns and trends. The patterns and trends you look for will be unique to your business idea but some common things to look out for include:

  • User end-point – what part of your website is losing users?
  • CTAs – which CTAs are getting the most clicks?
  • Pain points – are there similar pain points for multiple customers? Can you provide a solution to these?

You can use the trends and patterns you spot to help modify your product moving forward.

Assessing Feedback and Insights

You need to assess your feedback and insights to determine if your business idea is viable.

Although it can be tempting to focus solely on the positive feedback, often it’s the negative insights that can be the most valuable.

Assess any areas of your business idea that aren’t quite working and use the feedback collected to create an action plan for improvement.

Pivoting vs Iterating

Pivoting and iterating are often confused as the same thing but they’re not.

Iterating is all about making small changes to your business idea. For example, creating a new iteration of the original concept based on your user feedback.

Pivoting, on the other hand, is a total change to the product or service that you’re offering.

Knowing when to pivot and when to iterate is crucial for long-term business success.

If your user feedback has highlighted new areas of product development or new problems your business could target with minimal work required, it’s time to iterate.

If your testing has flagged up major problems with your business idea that are going to result in big changes and a lot of effort, you’re going to need to pivot to something else.

Testing Business Ideas: Summary

Launching a new business is exciting! Often it’s the result of months, even years, of planning and hard work so you want it to be a success. That’s why testing out business ideas is so important.

Not only does testing a business idea allow you to see whether or not there’s a market for your product or service, it can also open you up to new ideas or ways to improve that you haven’t even thought of yet.

By following the steps in this article, you’ll be able to determine whether or not your online business idea has the potential for success.

Be sure to let us know in the comments the results of your testing – we’d love to hear how you’re getting on!

Written by:
Black and white headshot of Lucy Nixon smiling at the camera
I’ve been a content writer for Website Builder Expert since 2021. Through almost a decade in the digital marketing industry, I’ve built up knowledge on everything from growing ecommerce businesses to building websites. I love breaking down tricky topics into digestible and engaging content for readers. Breaking down the jargon and uncovering the best platforms, tools, and strategies, I’m a meticulous researcher who’s committed to providing our readers with tips and advice that’s tried and tested.


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