#1 Navigating the product-market- fit journey for consumer delight

This is the first article in a series that has been created by asking a dozen food founders, who have survived the 'valley of death' and made it to scale, what the hardest questions have been when launching and building a new venture in the food industry.

Even though we’ve decided to anonymize the contributions, I’m extremely grateful to all who shared their perspectives on these topics! While being deceptively simple, questions like the one I asked for this article ('How do you know you’ve hit product-market-fit?') can never be fully settled into a single recipe for success and deserve the nuances that I try to highlight below.

In this first piece, we explore:
- Tech vs. Taste: From Technology Obsession to Consumer Connection
- Cash Talks: The True Measure of Market Desirability
- Stumbling Towards Success: Charting a Path towards Market Desirability

1.     Tech vs. Taste: From Tech Obsession to Consumer Connection    

The allure of technology-push is undeniable. It's human nature to become enamored with our own creations, especially when we believe they have the power to revolutionize the world. However, in the realm of food innovation, this approach can lead to pitfalls. Unlike the tech industry, food is deeply rooted in culture and tradition. Falling into the trap of technology-push can blind us to critical consumer insights. Spending years perfecting a technology in isolation can create a false sense of progress, shielding us from the realities of consumer preferences and behaviors.

While it may seem obvious to advocate for a market-pull approach, which I do, I also believe that while being ultimately rewarding in food innovation, it is also the most difficult to truly commit to and genuinely execute. This approach involves identifying and tackling critical problems that consumers face, rather than fixating on a particular technological solution. By focusing on the problem itself, rather than our preconceived solutions, we naturally gravitate towards achieving product-market fit. After all, it's the end-consumers who own the problems we aim to solve, even in B2B scenarios.

To succeed with a market-pull approach, we must step out of our own shadow and comfort zone in the labs, embrace vulnerability, hoping to find resilience within ourselves, and seek out direct feedback from consumers. This requires humility and an openness to criticism. But beware – this is not rushing into sales mode, but rather adopting a learning mindset, engaging in meaningful conversations with consumers to understand their needs and preferences. By reframing our approach from selling to seeking advice, we open the door to richer feedback and deeper relationships with our target audience.

2.     Cash Talks: The True Measure of Market Desirability

Let's discuss how we can determine if we're on the right path, focusing on the concept of 'validation' – the ultimate proof of market desirability and product-market fit. It all boils down to one thing: money. Yup, consumers reaching into their wallets is the gold standard. For business-to-consumer (B2C) interactions, it's all about repeat purchases. It's not just about that first sale; it's about customers coming back for more, showing they love your product from start to finish.

Now, in the business-to-business (B2B) world, things get a bit more complex. With longer sales cycles stretching up to 18-24 months, validating market desirability requires a different approach. Before being able to sign supply and offtake agreements, look for other signs of commitment from your customers that require effort on their side – are they advocating for your product internally, putting their reputation at risk, involving colleagues from other departments, investing their own resources, and showing genuine interest in your scaling-up plans? That’s a good start. But watch out for mistaking politeness for real interest. It's easy to get carried away with requests for samples or LOI (Letters Of Intent) agreements, thinking you've hit a milestone, when in reality no commitment nor investment has been made. I encourage getting paid upfront, even for samples and trials, as that little hurdle ensures you're building and focusing on commercial relationships based on genuine interest.

As innovators, we also need to be adept at assessing feedback objectively. Selective hearing, where we only focus on the feedback we like, is a trap we must avoid. Taste tests and surveys are helpful, but they're not the whole picture and risk becoming more of a vanity metric. While they may hint at potential, true validation comes when customers keep buying.

So, hitting product-market fit means balancing financial validation with genuine consumer feedback. By keeping an eye on both, we can navigate the tricky road of market desirability.

 3.     Stumbling Towards Success: Charting a Path towards Market Desirability

Validating market desirability isn't a straightforward journey; it's more like a series of stumbling steps forward. To progress, we must be open to feedback, rooted in the market-pull concept. Avoiding over-analysis is key – real progress comes from actual customer feedback, not from spending months performing desk research on market gaps and total market sizes. That's why creating a prototype or MVP (minimum viable product), even a theoretical one you are not yet able to produce, but one that at least triggers conversations with B2B customers and B2C consumers, is crucial for gaining clarity on the next steps early on.

Finding the right balance between focus and breadth is tough, especially at the beginning. Clearly, we need to prioritize opportunities that effectively address critical problems, can be executed quickly, and show early success. Building and scaling a small product boosts confidence and sets the stage for bigger endeavors. Focusing on one thing and doing it well is vital. However, we also need to maintain enough breadth of opportunities to allow for serendipity and for the industry to signal and nudge us where opportunities lie, while still leaving room to pivot. However, we must be careful not to spread ourselves too thin, as this could burn through cash indefinitely. Setting a time limit for validating desirability, aligned with industry cycles (e.g., considering retailers resetting their shelves), is wise to avoid short-term validations that may not pan out.

The criticality of the problem is another factor to consider, a key part of any customer discussion where you may be testing your solution – you should also test if your assumptions around the problems hold. Is it keeping people up at night? If not, it might just be a nice-to-have, unlikely to drive purchase behavior. Prioritize addressing problems that truly matter to your target audience. A new food ingredient that may at best increase a 4.5-star rating to a 4.6 may not be at the top of any food formulator's priority list.

Feedback variety is also a crucial signal. The more diverse and widespread the feedback, the further we are from achieving product-market fit. Once comments start to repeat and converge, we're on a clearer path to being able to identify and overcome real obstacles.

Overall, prioritizing market desirability over financial viability and technical feasibility is paramount. Nevertheless, clarity on a path towards scalability and financial viability is crucial before diving into a full-scale launch. Launching without this clarity is risky. Therefore, offering a product at a discount for market penetration is a smart strategy, but validating the product at the required price point is essential before committing significant resources to a wide rollout.

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Does your own experience align with the considerations above? Do you have a contrasting view? I’d love to hear stories from your own journeys, so please connect or reach out over LinkedIn to share them!

Warm regards, ciao!
Giacomo