12 Sep What can social enterprises learn from the tech industry?
Product market fit in the social enterprise sector: why your ethics aren’t enough
There’s a crucial part of marketing strategy which many brands neglect – Product Market Fit.
Product Market Fit is a concept taken from the high growth tech startup world but it hasn’t fully translated to the social enterprise sector yet – and there’s a lot that brands in this space could learn.
Product Market Fit finds the sweet spot between the needs of your customers and the features within your product that solves their problems – and it’s the key to successful marketing.
Identifying Product Market Fit should be the first stage of developing your marketing strategy, and you can start to find it by asking 3 questions:
- Who is this product/service for?
- What problem do they have?
- How does this product/service help them solve that problem?
This is why so many marketing strategies begin by identifying your ideal customer. You need to ask yourself ‘who is this for?’
You can feel when Product Market Fit isn’t happening. Some warning signs to look for are: word of mouth isn’t spreading, you’re not getting glowing reviews, customers aren’t coming back for more.
On the other hand, when you find that sweet spot you’ll experience a high level of organic growth, as satisfied customers become your very own marketing machine.
If you’re starting with your social impact and looking to develop a product to financially support it, then you can growth hack your way to success by focusing on finding Product Market Fit and using your findings to develop your product – embedding your marketing and tailoring to your ideal customer from the start.
But if like most businesses you already have a product, and you’re struggling to sell it, you need to work backwards – identify the problem it solves and then find the people that have that problem.
Sounds simple, right?
But many ethical brands and social enterprises make the mistake of producing a product without market testing it based on the assumption that because it’s ethical, it will sell.
Ask any marketer and they will tell you “build it and they will come” doesn’t work.
One advantage social impact brands have is that they generally find Product Market Fit naturally when talking about their cause.
Because they’re driven by values, and values are an integral part of our personality, it’s easy to find people that those values resonate with and build an emotional connection with them.
But because it’s easier to rally people around your cause and create a “Values Market Fit”, many social impact brands neglect to do the same work with their product or service.
Unfortunately the truth is that just because someone cares about your cause, doesn’t mean they’re willing to part with their cash to support it.
How many times do you see charity giving pages or crowdfunding campaigns and just keep scrolling?
The truth is that while the majority of shoppers say that good ethics are important to them, price and quality are still the highest purchase drivers.
If you want to find true Product Market Fit you need to look beyond your cause and think more commercially about your product.
The most effective place to start is to talk to your current customers openly and honestly to find out what they love, and more importantly, what frustrates them about your product. What’s holding them back from recommending it to a friend?
Don’t be afraid to take on criticism and go back to the drawing board with your product, features or target customers. The best tech companies aren’t afraid to pivot to find Product Market Fit, and that’s what makes them viral successes.
Getting the foundations of Product Market Fit right will make all your marketing efforts more effective, and save you money in the long run too.
How close is your social enterprise to achieving Product Market Fit?