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From uncertainty to proven opportunity: how we used digital testing to de-risk innovation for a Swiss start-up

(In)validating the market opportunity using growth hacking

A security tech innovation opportunity

Did you know that approximately 70 million smartphones are stolen every year worldwide? This staggering statistic highlights an opportunity for robust security measures to protect our devices and the personal data they contain.
A Swiss start-up is exploring just that; an innovative concept to enhance the security features of smartphones and prevent theft.
However, the company was facing several uncertainties when deciding whether to pursue this business opportunity further or not. The primary reason for their hesitation is the lack of clarity on whether people actually need or want this kind of product, and what it should do to solve the biggest customer pains. They also had some question marks sitting next to the ideal target market for their product, including age groups and user behavior.

Mapping the risks, and a plan to minimize them

The goal for the Swiss start-up was to measure if and how their security tech innovation resonates with customers. To this end, we worked with them to develop a digital validation strategy.
We mapped all the assumptions the team had about the concept and laid out all the knows and unknowns on customer desirability and viability. We needed to get data on both the size and type of the problem for the customers. We also mapped out assumptions on the target market and audience.
Out of this list, we prioritized the most critical business assumptions which needed to be valid for the concept to get sufficient traction and justify further development.
Also, we developed physical prototypes using 3D printing and digital prototypes to get real customer feedback.

Digital validation to measure real consumer interest

We used Growth Hacking tactics to augment more traditional qualitative research methods to validate the security tech innovation. More specifically, we used a “smoke test” in this project to determine:

  • the click rate for the prioritized value proposition within the desired customer segment,
  • the indicative customer acquisition cost based on the click rate.

These data points can be further optimized after a spin-in or spin-out of the concept. However, the data obtained will give you a first indication of how engaged potential customers are with your concept and will give you crucial information to validate the viability of the underlying business model.

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Example of a smoke test experiment.

(i) A smoke test is a digital experiment where we use different landing pages of your new product/service and launch ads on social media to attract potential customers. By measuring their clicking behavior on the ads and landing pages, we can determine their level of interest in each product or service variation.

The need is there, and the business model should follow.

Through the smoke test, we learned that consumer desirability is present for potential smartphone security solutions. We also gained information on which features of the potent technology are more interesting to make the concept work for customers, and which part of losing their smartphone sucked the most (the ‘Why’ of the problem).
On the other hand, we learned during this validation experiment that the business model was proven too costly to roll out under the current approach. The experiment provided structural insights to support this and generated additional assumptions which gave the start-up a new route forward: a shift to B2B segments.

Ready to start validating?

Validation strategies offer a business a way to replace opinion-based by evidence-based decision making. These validation experiments are inexpensive and fast approaches to de-risk innovation initiatives. The project above was conducted in a timespan of 2 months.
Want to validate new offerings for your company, but not sure where to start? Feel free to reach out to us for a chat to see if we can help you out.

Want to have a chat about validating your new product or service?


Olivier De Hous