Master the Art of Business
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Shadow Testing means selling an offer before it actually exists (you have to be upfront with your customers that the offering is still in development). Shadow Testing allows you to get critical feedback: whether or not people are willing to buy your offering.
You can minimize the risk of your project by gathering data from real customers as soon as possible.
The best way to validate the truth of your Critical Assumptions is to test them directly, but going through the entire process of starting the business is needlessly risky and expensive. It's much smarter to minimize your risk by testing your offering with real paying customers before you fully commit to making it real.
Shadow Testing is the process of selling an offering before it actually exists. As long as you're completely up-front with your potential customers that the offering is still in development, shadow testing is a very useful strategy you can use to actually test your CAs with real customers quickly and inexpensively.
Real paying customers are always different than hypothetical customers. Shadow Testing allows you to get a critical piece of customer feedback you can get in no other way: whether or not people will actually pay for what you're developing. In order to minimize the risk you're taking on in committing to the project, your objective should be to start gathering data from real paying customers as soon as possible.
FitBit is a company that knows the value of shadow testing. Founded by Eric Friedman and James Park in September 2008, FitBit makes a small clip-on personal exercise and sleep data-gathering device. The FitBit device tracks your activity levels throughout the day and night, then automatically uploads your data to the web, where it analyzes your health, fitness, and sleep patterns.
It's a neat concept, but creating new hardware is time-consuming, expensive, and fraught with risk, so here's what Friedman and Park did. The same day they announced the FitBit idea to the world, they started allowing customers to pre-order a FitBit on their Web site, based on nothing but a description of what it would do and a few renderings of what the product would look like.
The system collected names, addresses, and verified credit card numbers, but no charges were actually processed until the product was ready to ship, which gave the company an out in case their plans fell through.
Orders started rolling in, and one month later, investors had the confidence to pony up $2 million dollars to make the FitBit a reality. A year later, the first real FitBit was shipped to customers.
That's the power of Shadow Testing.
"Praemonitus praemunitus." (Forewarned is forearmed.)Roman Proverb
Master the Art of Business