By Greg Mercer, Founder & CEO of Jungle Scout, the leading all-in-one platform for selling on Amazon
Emerging entrepreneurs often convince themselves they should do something because it’s their “passion.” While doing that you enjoy is a key ingredient of any fruitful pursuit, there’s not much savvy to a business idea without structure — by structure, I mean a framework of data you can trust.
Before I created Jungle Scout, a platform built to help brands and entrepreneurs sell on Amazon, I was an Amazon seller myself. At first, I used my hunches to predict what products would sell successfully.
After lots of trial and error, I learned a thing or two about what goes into a winning idea. One of my central goals as an entrepreneur is to consistently reflect on my journey and help others through my experiences. If I’d had the knowledge I do now, what would I have told myself in the beginning? And, more importantly, what would I recommend to any entrepreneur now?
Trust the data.
It boils down to the lengths you’ll go to pursue the data to give you insight into the value of your idea — and you have to be prepared to not like what you see.
As an Amazon seller, I thought I should sell a trending product or one I personally might want to use. I was chasing a notion or preference rather than considering true demand, competition and other real data.
I got into selling on Amazon to indulge my entrepreneurial spirit, so I certainly won’t tell you to choose an idea you find uninspiring. However, I do want to encourage you to find something that balances both your “gut” and the data.
Recognize your gut versus the data.
Your gut is the instinctual “aha” moment of an incredible product idea, whereas the data gives you a road map of how to breathe life and build upon that “aha” moment.
Your gut is a type of data in and of itself. It’s a recognition of something — be it a pattern or inspiration, or possibly a deterring factor.
When you recognize your gut giving you that inexplicable motivating confidence, tap into those good feelings for inspiration. But understand it’s just that — a feeling. Without fact-checking your gut with real-life scenarios and historical patterns (data), you undermine your potential.
Here’s how to check it:
Research for the win.
As an entrepreneur, you have to start with doing your research. It sounds simple, but it’s easy to get swept up in a fantasy without sitting down and thinking critically about a game plan.
Start your research with some reflection on how much you know and care about your idea:
• What pain point is your business solving?
• What is your competitive advantage?
• Have others tried to do what you’re trying to do? Why did they fail?
• Do you have the resources to pull this off? If you don’t, how will you get those?
• Do you truly have the commitment to see your journey through?
The answers should give you the confidence to either dig deeper or to redirect your focus. Either way, now you should become as much of an expert as you can in your idea:
• Identify the thought leaders in your space. Read, follow and watch their content, research and updates to stay on top of relevant expertise for your idea.
• Experience it yourself. Say you want to start a ride-share app — ahem, Uber — but you don’t know anything about the current closest thing to it — ahem, taxis. Get out there and experience what you’re trying to “disrupt.”
• Consider your future customers, partners and other stakeholders. What is the journey they’re currently experiencing, and how can your business or product meet them where they are?
Let the data surprise you.
Do you ever learn about someone’s profession and think, “I never knew that was a job,” or “I never knew a business selling [fill in the blank] could be so successful.”
These are most likely the ventures born of data. Someone needed something, and someone realized they could make money by providing that product or service.
While I searched for products on Amazon, I was surprised to discover what products were actually successful. From an e-commerce perspective, you never know when you’re going to find a sweet spot in the Amazon world.
I created a line of bamboo marshmallow roasting sticks and I never would have launched it without the guidance of data. In fact, it was such a hit that I made it a case study to show other sellers how to find products on Amazon.
I learned that whatever your idea is, it’s important to start small, scale modestly and constantly accrue feedback from your target audience.
You won’t know if you’re onto something unless you know how people will react to your product or idea. Create a minimum viable product (MVP) to learn from (gathering more data) before sticking your neck (i.e., your product or business) out into the market.
This allows you to learn with a lower risk and move on to larger datasets without overwhelming your resources and yourself. You can also avoid the pitfall of investing thousands in a failed prototype or a half-baked business model and measure the data you need to make better choices.
Starting a business or launching a product is a tremendous labor investment. Every minute you spend building your business is precious, so you have to prioritize your efforts. You can’t manage what you can’t measure.
Data will set the foundations of your business. You may not know exactly where it may take you, but you can be confident that it’s telling you truths your gut can’t. With data, you can understand how to effectively market your business, position yourself in a competitive consumer market and pivot for success.