What is product-market fit? Why do you need it for your startup

5 min read

Today’s app market is extremely competitive. Tens of countless new apps appear every month in AppStore and Google play, and very few ultimately succeed. If you are hoping your app will be one of those that make it, you’ll discover that product-market fit (PMF) is essential. In this article, we want to figure out what PMF implies and how to make sure your mobile app has it.

What is product-market fit?

Product-market fit is about to do with having the ideal product for the best market. Despite the fact that there’s no single standard on how to measure it exactly, there is no arguing that when you have PMF, product purchases and growth tend to skyrocket. When you do not, the opposite will happen as customers are not getting the value they want out of your app. PMF does not just indicate having users who are willing to pay for your product, it typically also indicates having pleased clients that will spread the word, and become your greatest salespeople.

How To Measure Product-Market Fit

According to Forbes Magazine, a product-market fit is a hair-on-fire issue that an identifiable group of individuals has. It’s a scenario in which a product satisfies clients’ needs in such a way that alternative products do not. Marc Andreesen, who introduced the term in 2007, thinks companies who have actually attained this perfect state can feel it due to the fact that money is piling up, and investors are more and more interested in business. On the other hand, startups who haven’t attained product-market fit can feel it due to the fact that word of mouth isn’t spreading out, offers aren’t closing, and press reviews are flat. Aside from just having the ability to feel it, the most concrete method to assess your product-market fit and comprehend how clients see your app is by sending them surveys. The concerns in these studies are pointed, and ask clients if they think your item is a must-have and if they would miss it if it were gone.

Product Market Fit Questions

When you design your surveys, you want to reassure that all questions will give you the answers you want. Here are some examples, along with designated answer choices to be included.

  1. How would you feel if you could no longer use this item?
  2. Really dissatisfied
  3. Somewhat disappointed
  4. Not disappointed at all (it really isn’t that helpful).
  5. N/A – I no longer use the product.

A follow-up question to this is “Please help us understand why you chose that answer,” where app users can specify their answers in a text box. Their responses will provide a more in-depth understanding of why your product means so much a lot to them or why it is not a must-have.

Product-market fit for a mobile app

So, how to determine whether your startup concept has a product-market fit? Well, drawing on what we saw above and suggestions from other specialists, here are a few strategies to help you out.

  1. Check the keyword search volume in the app stores

If you have not launched your app yet, this is an exceptional starting strategy. Both Google and Apple have data available on this front and there are tools such as Mobile Action or Sensor Tower that provide access for the data for both stores and can come rather useful. There is no one perfect tool to carry out this research study, which suggests you will have to do the legwork by compiling information from different sources, however, if you do it, and you do it well, it will all be worthwhile.

  1. Analyze app shop conversion metrics  

This is something you can do when your mobile app is already up and running. Both the App Shop and Google Play generate data, such as conversion rates, that you can use as leading indications, which you can then compare to the average in your category. If your conversion rate is not as average industry one, don’t despair, as you can constantly work on app shop optimization and find methods to enlarge conversion.

  1. Use Sean Ellis’ 40 percent Guideline 

According to Sean Ellis and his startup pyramid conception, an excellent way to measure whether you have actually got Product-market fit (PMF) or not is performing a study to check how users feel about your app. If at least 40% of your users would be “extremely dissatisfied” if they did not have access to your app anymore, then you’re absolutely on the right track. It is important to keep in mind that we do not advise you to use just one of these 3 techniques. When it comes to mobile app performance, the more the merrier. Likewise, keep in mind that you should compare yourself with other apps in the very same category as yours that have similar usage patterns, so you get more reliable and beneficial information.

Product-market fit is a continuous process 

It might seem like you need to just concentrate on PMF before releasing app or just after starting out, but it is actually something you must never ever take for granted. Markets and trends constantly change, which means that your app need to be changed accordingly to remain in the game. Furthermore, you may want to add on to your app or broaden to new markets, and this also means working on your product-market fit. For all these factors, PMF is something you must remember throughout your app’s lifespan.

Product-Market Fit Goals for Startups

Many startups fail because they invest in apps that nobody wants to purchase. Startups need to prioritize product-market fit above all other goals since those that find it will significantly increase their odds of success. To avoid this fate, ensure you understand the discomfort points your item fixes along with the difficulties your consumers are looking for to solve. You can do this by focusing on 6 main areas, which we’ll discuss below.

  1. Determine your target customer.

Work to determine the target client who represents the users that will more than likely benefit from your product. Usage market segments to define your ideal customer, and establish buyer personas for those consumers, so your group will clearly comprehend who it is building towards.

  • This procedure can be divided in four steps:
  • Analyzing your service or product
  • Familiarising yourself with your competitors
  • Choosing sector criteria
  • Carrying out research study

The research phase itself is thoroughly crafted around defining your buyer personality, determining which part of that personality you’ll target, performing market research with ready research concerns, and summarizing your findings into absorbable takeaways to show your individual contributors, executives, and board.

Have a great idea but don’t know where to start?

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  1. Gather intelligence

Talk with your clients to determine their pain points and just how much they would think about paying for a solution to those obstacles. Look for insights from your sales and marketing teams to recognize repeating customer complaints. Gather a large adequate data sample to offer significant feedback. Think about, too, that face-to-face conversations will typically generate feedback that online studies will not.

  1. Focus on a single vertical

Most of the startups have a tight budget which indicates that attempting to offer your products to everybody will likely result in disaster. Begin with a narrow focus and dive deep into that market. Establish yourself as the market expert in a single domain with a goal to stimulate a viral spread. For example, Spotify saw that individuals were ready to pay a small cost for endless access to music legally. They didn’t enter into the marketplace attempting to take on existing music streaming services like the discovery-focused Pandora or the more standard, pay-per-album structure of iTunes. They developed a platform for people who wished to listen to any album, at any time, by just paying one cost. They discovered a gap in the market and targeted the people in that gap.

  1. Specify your value proposition

Determine which customer needs you can best address with your services or product. Find out how you can surpass your rivals and satisfy your consumers. Don’t forget your product roadmap when determining which challenges you’ll deal with; not every problem will suit yours. For example, Spotify’s value proposal places the streaming service as offering access over ownership, offering data-driven personalization, and the chance for material unbundling.

  1. Measure your product-market fit

You should measure your performance to manage your success. Determine key data points that will help you track performance. Start by determining your total addressable market (TAM) – the overall number of people who can take advantage of your product/service (i.e., If everybody might utilize your product/service or began using it). TAM can be calculated by increasing your average income per user (ARPU) by the total possible clients in the market. Once you have your TAM, determine what portion of your TAM are current app users.

  1. Prevent complacency

If you manage to accomplish the product-market fit, don’t assume you’ll constantly have it. Your clients’ needs will change gradually, and you should continuously re-evaluate market conditions to continue fulfilling those requirements.


Succeeding in the mobile app industry is not a simple task. It takes a lot of work before and after releasing your app into the market. Product-market fit is among the many tools that will provide you an opportunity out there. We hope this info has actually proven beneficial which you can use while developing your app if you don’t do so already. 


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