A great idea? Check
Developing the product? Check
Getting traction? Now, what’s that?
“Traction trumps everything”, says Gabriel Weinberg, CEO & Founder, DuckDuckGo and Co-author, Traction. To him, “Traction is the best way to improve your chances of start-up success. Traction is a sign that something is working. If you charge for your product, it means customers are buying. If your product is free, it’s a growing user base.”
Naval Ravikant, Founder of AngelList puts it as, “Traction is basically quantitative evidence of customer demand.” And if you’ve been in the start-up game long enough, you’ll know that start-ups don’t fail because they can’t build a product; start-ups fail because they can’t get traction.
So, let’s understand ‘traction’ better. For this, we’ll have to draw from a recent episode of IoT Buzz Podcast which featured Shannon Gilleland, Founder of Pronto Bottle and Founder, Form-i-Baby Pty Ltd. Pronto Bottle, by the way, is the world’s first self-sterilizing baby bottle.
Let’s put Shannon’s journey through the stages of gaining traction and see how this powerful tool can help address multiple issues across a business from fund-raising to hiring to development to partnerships to acquisitions.
Three steps to gaining traction
Step 1
Make something people want
Like it usually is with innovation, Shannon as a mother, faced a problem and she decided to solve it. Her solution was a Pronto Bottle which basically is an all-in-one solution that uses UV-C light to not just self-sterilize the bottle but also the content inside it anywhere.
And like with any other innovation, the key questions for her were:
- What is the problem?
- What is the solution?
However, she knew that a problem-solution fit that only catered to an individual’s needs won’t make her start-up an overnight success. If she wanted to make something out of her idea, she needed to make something that many people would want and not just her. In fact, she Interviewed close to 100 parents and asked how they were travelling with their babies. The biggest problem that parents talked about, in the long list of problems, was bottle feeding.
Once that was done, there was a whole lot of research that followed—what products existed in the market and would customers really want what she was intending to sell. In this stage of gaining traction, Shannon had to ensure that there was a product-market fit, that the first customers tested the product and were convinced that it would work.
All in all, it means that the first stage equals product-market fit, that what she was going to sell was of value to the customers.
Step 2
Market something people want
Once Shannon and her team had established that Pronto Bottles could cater to a particular need in the market, they had to plan how the product would be made available to people. In fact, Shannon reiterates how she would have focused on being able to market better when she says, “Branding was so important for parents. We totally underestimated how important it was for a parent to know the brand to be able to create that sense of trust that this is safe for me to give to my baby.”
Mark Peter Davis says, “Investors want to know that a company can repeatedly acquire customers for $X and generate more than $X in gross profit from each customer.” Traction proof in this stage equals sustainability and for that market strategies need to be planned to ensure that enough customers stick around.
Step 3
Scale your business
Startups often struggle with resources. Focus on one thing and it feels like all other verticals are not getting the needed attention. Being able to scale a business is therefore critical because that means that there is an increase in revenue without a substantial increase in resources. Once a startup has proven that it has a product that people want, it is time to take the product to the masses.
For Shannon, the scaling goal is to make her product have a global reach. She believes that there’s a massive market for parenting products and that global reach is possible so long as the product addresses the following:
- Removes mundanity
- Creates ease
- Fosters connectivity
Proof of traction in this stage equals having a market presence with a well-established business model and making profits.
How proof of traction helps
Collecting data points from interviews, running fake sale cycles, having plans to convert leads to sales, figuring out the cost per action and doing all the needed baseline work—are what helped Shannon in her conversations with investors and end-users alike. Data points helped her show that her product had real-time market value.
Traction proof was how Shannon was able to tell investors, competitors, and customers alike about the value of her product. And that’s what you’ll have to do if you are a start-up and are looking to succeed in this highly competitive market.
