It’s never too early to start getting sales for your product! Be prepared to get the validation you need to sell your product before you make it. We talked to Ira Hayes, Head of Strategic Development Initiatives at IdeaPros, about three steps you should take to leverage pre-sales and investors to get the most out of the process.
1. Awareness
Awareness is the fundamental building block in launching your idea and the good news you can do a considerable part of it yourself. Create a spreadsheet of the groups you can join or influencers that can help you promote your product or app to the right audience. Then build a website where your fans can sign up for the pre-sale. You can offer them something in return such as discounts or VIP status to help you start collecting emails.
“If you can find a thousand people that will follow you and anything you do, you can create a great business.” – Ira Hayes
Offer something valuable, educational, and meaningful so people will start following you. If you are a subject matter expert then write a blog. You don’t necessarily have to talk about your product to get a following. There is an excellent example of Rooftop Liferafts used in the event of floods or hurricanes. The founders wrote about prevention, the environment, and how these rafts can save lives. They validated their idea before they even had the product and that is the way to do it. Figuring out how to tell your story takes time, so it is essential to start early. Once you have your following, stay in touch with them, nurture them, and give them little updates.
2. Intent To Purchase
Once you have people aware of what you are doing, you have to ask yourself how you can monetize it. Intent to purchase is not about money, it is about validations and is a crucial step in the process that leads to actual sales.
“Intent to purchase means someone took out their credit card, which is hard to do, and gave you a dollar.” – Ira Hayes
Even though this amount is small, it solidifies who is going to buy from you more than an awareness campaign. If you started with a hundred people in your awareness campaign, you might have 1% to 3% that will eventually purchase the product. Once you know your numbers, you can take them to investors and ask for funding because your idea has been validated. Offer your fans something in return for their money. If it is an app, invite them to be in the core group and test the beta version. Their feedback will help you shape what you are going to deliver.
Entrepreneurs often ask what happens if I end up without the product, as I am doing all this before the product physically exists? In the worst-case scenario, you can always give the money back to people. You need to create a community around this intent to purchase.
3. Pre-sales / Sales
The third part of the process includes pre-sales and sales, and it becomes much easier when you’ve done the first two steps correctly.
“The only thing you need to do is sell one and possibly not to your mom.” – Ira Hayes
It starts the tipping point as you begin figuring out the rest. Now you can start building your forecasting model and show investors how many people signed up, downloaded, or showed intent to purchase the product.
When you’ve done all these steps, this is when investors start to say YES more and the money you get from them will help you turn this one product into 100, then into 1,000 and 10,000, etc. Recently it has been easier to generate pre-sales with high price point items as they incur much more initial costs. Even if you have a lower price point item and you’ve figured out the first two steps in this process then you are ready to move forward.
The “Idea Pros” at IdeaPros have the resources, experience, and tools to help you at this step or any step in the entrepreneurial journey.
We partner with entrepreneurs at any stage and who are ready to invest their ideas. Apply for an interview and let’s explore partnering together.