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How to take a digital product from idea to reality
So you want to start a business and you think you have the perfect product idea. Before you start investing time and money in developing your product, it's important to follow these steps.
1. Getting the concept right
So you have this idea that you think will make you rich or fix a problem in society. How do you take it from a concept in your mind to the hearts of your users?
The first thing you should do is to organise your thoughts and WRITE down your idea(s) in a structured way.
There are many frameworks out there that can help you structure your thoughts, but in this guide we'll teach you our personal favorite approach: the user-centric approach.
What is the vision/mission of your idea?
Write down in one sentence the vision your idea is trying to achieve in the next 3–5 years. A great vision is something that is succinct, objective and grand.
A vision needs to be succinct and generate a visual image because good products are SIMPLE. If you can't describe a vision in one sentence, how will you pitch it to cofounders, investors and your customers?
The vision needs to be objective. After every milestone you should be able to come back to your initial vision and very clearly state whether you’ve gotten closer to that objective.
Your vision needs to be GRAND or a problem you truly feel passionate about, because starting a business and launching a product is the toughest thing you will ever do, and at every turn there are 99 reasons to give up and only one that keeps you going: that you are doing something grand and something that you're deeply motivated by.
We want to stress to you that at the conception stage of your product, you shouldn't fall in love with any detailed solutions, designs or implementation. You need to fall in love with your vision and the problem that you’re trying to solve.
A bad example of a vision
“I want to create the best supermarket with free delivery for groceries for the Cleveland metro area.”
A great example of a vision
“I want to make grocery shopping easy and enjoyable for Americans”
Who are your users?
The next step is to write down your perfect user and everything you know about him or her. Try your hardest to empathize with your perfect user and write down his or her name, age, occupation, race, culture, relationship status, likes and interests, motivations, typical day and so on. Next write down the main pain point you are trying to solve for the user.
Jasmine, 35, a married mother of 2, working fulltime as a marketing professional from Denver. She is motivated by the wellbeing of her family and most of all by the wellbeing of her two young children Zac (5) and Jamie (8).
She is a professional marketer but it is a means to an end. Her day starts early at 6:30 where she wakes up, cleans up, makes breakfast for her kids and husband. She makes sure the kids wake up on time, remembers to pack their homework, clean, dress and eat. She hurries them in the car and she takes them to school before going to work herself. She spends her lunch break thinking about what to cook for dinner, what’s left in the fridge, how Zac did at the spelling bee and whether Jamie forgot to bring his hat.
She finishes work at 5:30, but it’s never enough time to buy groceries, get home and make a healthy meal for everyone. She tries to get Jack her husband to buy groceries but he’s busy and doesn’t know what ingredients are needed. She rushes to the closest supermarket near her work because the supermarket near her home is further. She quickly buys all the groceries that she scribbled on a piece of paper and rushes home on the subway. After getting home at 6:30pm, she and Jack wash, cut and cook together, but she realises they are out of garlic.
From writing down a hypothetical day of your user, you gather pain points. From this very basic passage we are able to learn. Every pain point you write down here is an opportunity for your business.
Jasmine is time starved
She wants her family to eat on time
She wants her family to eat healthy and fresh
She wants to know what is left in the fridge
She has to remember what she needs to buy
She has to find and park her car
She has to carry the heavy groceries with her on the train
As you learn more about your users through empathy, quantitative research and qualitative research you will have more and more pain points you want to solve.
Keep in mind that the current solutions to the goal already solve many pain points that aren’t easily discovered here without further research. For example, Jasmine obviously cares that the produce she buys is fresh, but that pain point is largely solved and not an opportunity.
2. Determining the TAM (Total Addressable Market)
The Total Addressable Market (TAM) is the total possible market for your product or solution. There are many ways to determine this, but we like using the Fermi approach to this question. This involves estimating the biggest potential group of users and how often they will use the product.
Define the question clearly. Given our goal we can define it as, “How much money do people spend on groceries in the USA per year?”
Write the formula. Total amount (USD) spent on groceries per year = Dollar amount of food consumed per person per day x population of USA x 365. This is obviously a very big number in our example, but if your vision isn't grand enough this is a great litmus test for you to go back and think bigger. This exercise is done to ensure you have a grand enough vision, and not as a way to forecast your revenue. Therefore ballpark estimates and assumptions are encouraged.
Assumptions and ballpark figure. In this example we have to make an assumption on the cost of food in dollar terms an average American consumes. We could estimate something like $2 for breakfast (juice, 2 eggs, a piece of toast, some butter), $6 for lunch (meat, veggies, oil, condiments, etc.) and $6 for dinner (as above). The other assumption we're making is that we're able to source the groceries at this rate (the wholesale rate in this case).There are more detailed ways to break this down by writing sub formulas that segment your users (i.e. age, class) if you're targeting a more niche set of users.The next thing for you to do is to work out your ballpark estimate and validate it. In the example we provided: $Total amount = $14 * 325 mm * 365 = $1,660,750 Million USD or $1.7 trillion dollar market.
3. Examine existing solutions
Write down all the different options that your target users use to achieve the goal that they have. You don’t need to write down all the brands that provide solutions, but aim to write down the different models of business and any alternative solutions to your user’s goal. Scribble down the biggest pain points that these solutions solve (or benefits they provide to the user), and make sure you append that to the list of pain points you think of as you go through your competition.
In our grocery shopping example, it could be something like this:
Options for grocery shopping
Supermarkets (Cost, fresh, large variety, healthy)
Home delivered produce (on time, expensive)
Local markets (fresh, healthy expensive)
Home delivered meals (UberEats)
4. Designing your ultimate product
First of all, there is never an ultimate product as users and their needs evolve over time and as new technologies arise. But that doesn’t mean we shouldn’t aspire to be the ultimate product for this time for our target group of users.
Start by choosing a medium for your product. Is it a brick and mortar deli, is it a website or app or a health and food magazine? Next list out all the features your product could have and tie those back to the pain points of your target users. In our example it could be something like:
Shopping list page that recommends items based on healthy recipes
Shopping cart so users can save items
Home delivery that is always on time and ensures fresh groceries
Tracking feature for each family member's requests or favorite recipes
Feature allowing recipe sharing between friends
Ability to link to smart fridge and recommend items
Ability to link to smart scale to track weight loss and diet goals
Once you’ve done this, it’s time to start mocking up what your product may look like and what it should be called. There are many tools out there to help you with your mock up. Our favorite is good old pen and paper, but if you're looking for a bit more detail you can check out apps like Balsamiq and InVision.
Naming your product
Your product’s name should be memorable and should try to convey the value proposition of the product. Here are some specific guidelines for naming your product:
The name should be unique in the market you are trying to address
The name should memorable
The name should be easy to spell
The name should not be culturally offensive or even insensitive
The name should be short and succinct or able to be abbreviated when not (i.e. Benz for Mercedes Benz)
The name’s equivalent domain name should be available for registration
The name and domain should not be competing for customers or traffic with an existing brand
The name resonates with your core target market
The name should be fairly short, and preferably 3 syllables or less (notable exceptions include Coca-Cola).
Make sure to buy and register the domain name of your product.
In our example above a decent name could be something like YouFresh, ShopFresh, EatFresh. For the rest of the article, let’s use the example of EatFresh. These examples tick most of the checklist above.
A great logo is simple and clearly visually represents the name and vision of the product. To create a logo, start by writing down some elements and words and emotions that describe your product. Next just grab a pen and scribble down some mockups of what you've written down. Make sure your mockups and elements are simple so people can remember them visually.
The same guidelines for naming a product also apply to creating a logo for a product. As you’ve come up with some mockups you’ve most probably learned more about your product vision. Unless you're a seasoned creative type you’ve probably realized that it's very difficult to create great visuals for your product. It's a good time now to brainstorm names and get a logo created. Freelancer.com has tens of thousands of active and highly skilled logo creators who can help you do this.
Now that you have product mockups, a name and a logo designed it’s time to scale down your grand visions into MVP (Minimum Viable Product) user stories. User stories are activities you want your user to complete using your product. This may seem like an easy thing to do but it’s actually one of the most difficult steps, because your business will very likely to be constrained on resources and, therefore, the features you can build to accommodate (unless you happen to have a very rich uncle).
There are several steps in determining MVP user stories:
Write down a few major categories of user stories
Write an exhaustive list of user stories for each category
Apply a framework to prioritise the categories and user stories
You might think you don’t need to be so rigorous and that you know exactly what features you need without even thinking about user stories, but unless you're a mind reader or the only target customer, it's an absolutely critical step that you CANNOT skip. To get help gather user stories, you can call on the help of a freelancer.
Many business founders who skip this step end up building a product that they love as opposed to a product that all target users love.
Here are a few examples for our hypothetical app:
EatFresh user story categories
Figuring out what I need to buy
Getting a wide selection of fresh groceries
As a user I want to be able to purchase milk, cheese, bread, etc.
Getting the groceries to me
As a user I want to receive groceries to my door within one hour of ordering
As a user I want to be able to order and pay beforehand and pick up the groceries in store
As a user I want to make sure the groceries are always delivered to the correct address
Once you have an exhaustive list of user stories we recommend you use the MoSCoW framework to scale it down to the MVP list of user stories. In other words, think through each of your user stories and label them as, “Must Have," “Should Have,” and “Could Have,” and do the same at the category level. Be ruthless and really scale down your product into the bare minimum.
Now that you have categorized lists of MVP user stories, it’s time to go back to your mockups and really flesh out the full designs for your MVP product. At this stage you’ve generally got a good idea of how you want the product to look, but product design is a complicated form of art.
Good product designers, be it UX designers, graphic designers, mobile app designers and so on, consider many different factors while creating designs that users love. The broad categories are:
After your designers gives you designs, don't rush into developing your product. Go out there and validate the designs. Load the designs into your phone, tablet or laptop and ask potential users to give you feedback. Go and perform some testing in the wild and ask users to perform simple to complex user stories on the designs.
There are many tools that can help you perform your research. Google Surveys can help you gather feedback on your designs and concepts. Usertesting.com is a platform that can help you validate your designs by connecting you to many users who will test your designs for a fee.
After you’ve done that make sure you prioritize them using a framework. At Freelancer product development we like to use R.I.C.E. Rank your individual features using the R.I.C.E. score so you get an inkling of what should get built first and how hard it is to build each feature.
Reach: How many of your potential customers would this feature reach?
Impact: What is the impact of this feature for your users or your primary objective?
Confidence: What is your confidence in your estimations for the other variables?
Ease: How easy is it to build this feature?
Once you give each of your features scores on R.I.C.E, you can choose to multiply or add the scores together. The critical part of the exercise is to prioritize the features of your MVP using an objective framework based on what the users want and not what you want. There are non-standard cases where the scores of a feature may be low due to ease and confidence, but it may be a deal breaker without that feature.
In our EatFresh example, we’ve compared two features in the following table. The first feature is a feature around creating and offering daily recipes. The second feature allows customers to pay for their grocery order. The logic is that we may estimate that only 50% of our customers would use our daily recipes feature, whereas 100% of our customers would need to pay.
Once you’ve spoken to many users, you should organize the requirements, make changes to your user stories and features and request that your designer iterate. Once you’ve done this form of validation a few times, that's when you should seek out engineers to actually build your product.
Build a one-year model of your MVP
Start by breaking your entire product down into funnels. A common way to do this is to break it down using the pirates metrics system, or A.A.R.R.R. (get it?). Pirates metrics is a famous framework used by growth specialists to break down the main streams to grow a product.
Below are some potential metrics you should aim to estimate and track:
A (Acquisition): Traffic (if you’re a website, store), downloads (if you’re an app), leads, signups, logins, etc.
A (Activation): Add to cart, favoriting something, downloading something, schedule a chat, etc.
R (Revenue): Completing first purchase, paying for a membership, etc.
R (Retention): Daily active users, second purchases, etc.
R (Referral): Telling a friend, sharing on social media, etc.
Building a one-year model of our EatFresh iOS app by applying the pirates metrics might look something like:
EatFresh iOS App
EatFresh iOS App
Searches on iOS
EatFresh iOS App
EatFresh iOS App
Add grocery to cart
EatFresh iOS App
EatFresh iOS App
Average order size
EatFresh iOS App
EatFresh iOS App
EatFresh iOS App
Signups from referral/week
This isn’t a complete example. It's missing key metrics like downloads, form completions, email verifications and reviews, among other important steps in the funnel. It also doesn't factor in costs or revenue from each item sold. It should merely be treated as an example of how to think about building out your first product model.
Once you’ve done your user testing and validation make sure to plug in your estimates to see what kind of revenues your product can generate. If there is a particular part of your funnel that's a bottleneck, be sure to keep thinking of ways to improve it.
In the EatFresh example, if the “Add grocery to cart” and the “Pay successfully” steps have a major drop-off in between, we may want to adopt cart abandonment tactics like sending a reminder SMS or notification to prompt users to complete their purchase.
Build your product MVP
You might be very anxious and stressed having to actually build your product, but if you’ve followed our guide and properly planned, then congratulations! You’ve already done most of the heavy lifting.
There are two main ways to get your product built. Each comes with its own pros and cons.
Do it yourself
You have full control of decision making
Time & labor intensive
May lack the technical skills required
Hiring someone to build it
You can focus on strategic areas of the business
You can get it done faster and better
Generally more expensive
Overhead of managing an extra person
Getting your developer to understand exactly what you want built
If you elect to hire someone to build your product for you, there are three main options to consider.
There is no correct option, so find the one that best suits you and the product you want to build.
Finding a technical cofounder: Do you know a technical friend, colleague or acquaintance? Go and talk to them and sell them your vision and product. For a decent chunk of equity you could find a cofounder to build a business with.
Hiring a digital consulting agency: Get a few quotes from digital agencies, but be aware that they're generally very costly and out of the budget range for a solo entrepreneur.
Hiring a freelancer: A skilled freelancer will typically charge a fraction of the costs than agencies. On our site you'll be able to select experts who have a proven track record of delivering projects, and you'll only pay when you're satisfied. If you're worried about actively managing the project, our Project Manager service will actively manage your project for a price.
Whichever option you choose, we recommend you have a thorough discussion around how they plan to build the product with particular emphasis on the following details:
NDA & IP agreement: There have been many tearful stories of great ideas being stolen, so before you start discussing the details of the product you want built, make sure you get a legal document signed (digitally or in writing) to protect yourself.
Requirements: Provide a set of documents that precisely explain in detail what you want built. This should include designs (UX/UI), user stories and acceptance criteria for individual pages.
UX: The behavior of a page after a certain action or event happens. For example, “When clicking on the 'Add to Cart' button, the screen should prompt that the item has been successfully added.”
UI Assets: The requirements should contain all the iconography, images, videos and copy on all the pages being built
User stories: Each individual page should have a set of user stories, and they can act as the acceptance criteria for each individual page.
Additional acceptance criteria: This is any additional acceptance criteria the end product should meet. This includes but is not limited to which browsers, devices and concurrent users the product can support.
Stability : How stable is the product? What will happen in the event the website/service is down?
Extendability: How easy will it be for me to hire someone else to extend the product? Is it written in a way that is easy to comprehend? Is it written in a modular way? Are the chosen frameworks well known?
Security: What is the plan around security in the product? Focus on user data privacy. In other words, how are passwords, emails and user details passed around and stored?
Keep in mind that for different products you should put different weighting into each of these sections. This guide is meant to provide you with the breadth of what to consider, but for certain products some of these are less or more important than others. Also note that there is no perfect solution to build the product. There will always be a trade-off between quality, speed and cost.
6. Launch your product
While you're building out your product make sure to start working on a go-to-market strategy. For a successful launch you need to consider the following things:
Channel & Audience. This is the trickiest part of the launch. First-time entrepreneurs often employ too many channels, as the typical thinking is that the more channels the product is in, the more people will see it. The fallacy is that the blitzkrieg approach will often be hard to control for cost (different channels have different cost barriers), attribution (where your users are coming from) and targeted users (you may get many users, but it’s more effective to target the users your product is built for).You should think about your target users and where they reside and look for channels that allow for targeted marketing. For our EatFresh example, some effective channels may be handing out flyers outside your local supermarket, Google Ads targeted to people who are searching for dinner recipes, etc.
Budget. Make sure you allocate your budget according to your estimations from your one-year model. From your model you should be able to work out your users' lifetime value (LTV) and figure out based on typical industry marketing metrics roughly how many users to expect. Keep in mind that your first product launch is very likely to be unsuccessful, so you want to test the waters with a small budget. After getting more data around conversions, CAC (customer acquisition cost) and LTV, you can then iterate on the product and launch and do it again.
Messaging & Collateral. The key to selling a product is having the right messaging and design that encapsulates the emotion a customer of your product feels, and the key benefit for that customer. A classic example would be Nike. Their advertising is often focused on an athlete (customer and emotion) wearing Nike gear (product) performing at extreme levels of athleticism (benefit) with the tagline, “Just Do It,” (emotion and benefit).
In our EatFresh example, the emotions we probably want to go with would be the guilt of not having time to cook a proper meal, and the key benefit is the ease of use. So a successful ad could potentially be a stressed professional (customer & emotion) ordering groceries on our app (product) with the tagline, “Fresh Groceries in a Few Clicks.”
Just like your product, make sure you validate and iterate as often as possible! It takes many, many tries to get your product and its marketing perfect.
To wrap up our guide, we want to leave you with a few guiding principles:
Validate and iterate: You don't need to get everything perfect the first time. Just remember to reflective every step of the way. Believe in the mission and vision, but be flexible on how to get there!
Possible ways to fail: Starting a business is difficult. It’s good to be optimistically paranoid. Think of the potential benefits your product has, but be extra mindful of all the risks that can put your business under.
Remember your original goal: When the going gets tough, make sure you go back to your first days of planning and remember why you started this business in the first place.
Best of luck to you and your business! We hope you make it BIG!