One of the questions I like to ask entrepreneurs is “Are you unleashing latent demand for your product or are you taping into existing demand?” This question is another way of asking “Do most of your clients have an existing vendor that you replace or are you the first vendor they ever use?” Here are a few questions that come up with this important question:
- Why isn’t there more demand already?
- What can you do to help grow the market?
- Can you solve the problem(s) that is/are holding back the growth of the market?
- Is it a timing issue (e.g. the market is about to explode) or is it so early that you risk not getting to scale?
The question also helps determine if it is an innovative or replicative business. My recommendation is to think through this topic as part of strategic positioning for the business.
Do you agree? What other questions would you ask related to market demand?