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If you are the founder or CEO IA Starting technology or a business represented by a digital product, then, as an entrepreneur, first of all, you know every business must be useful. Otherwise, it simply will not survive.
I have noticed how many stakeholders believe that attracting a massive user base must come before asking users to pay the software they offer. How do I know? I thought the same way when I started my first product, and after many examples from customer projects, I began to reflect on this model.
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Product analysis is the foundation, and the metric of active users for a period of time is really essential for your digital solution. Users are the blood of life: they bring money through their actions (or inaction, sometimes). However, the main question is: I DO They bring it inside?
Having many users does not mean automatically high profits. The economy of your product unit should be based on the fact that profit from a single user must be higher than the costs of buying this user. This is exactly the way that leads to a sustainable business model.
If we exclude income from direct sales of goods (services) through digital channels, then earning money becomes the only way to achieve this goal. There is no valid reason to push it.
Four benefits from prioritizing earnings at first
Instead of focusing solely on the number of users and quantitative ways to attract them, consider how you will qualitatively transform them into customer payment.
To this end, depending on many variables, I suggest expanding the budget for your technical project from the beginning in order to be sufficient for the implementation of money earnings from day one. And here are four reasons why.
1. You focus solely on that which brings value to users
Once, our team worked with a Wellness start that introduced their minimum applicable product platform (MVP) with a reconciliation model from the beginning. Instead of following user numbers, they focused on providing premium features that addressed the useful user needs. It took a lot of effort, but together, we were able to give an experience that made the purchases.
This approach left us no choice but to secure it and do it in a way that competitors were not doing, or maybe no one was doing yet. In just six months, they proved their product and reached a continuous income, enabling them to reinvest in development and grow rapidly.
In other words, you will naturally focus on giving true value. If you want to upload for your product, you need to make it valid for users. Otherwise, if you want to make it valid for users, you have to pay for your product.
2 you get operating funds for the project
Finishing cash can cost everything literally. The above case illustrates this: the consumer can save one fifth of their budget first and risk losing 50% later, remaining stuck in a permanent stage of MVP. On the contrary, the earlier profit in the early stages was used for operational needs, allowing progress.
Add any noticeable bonus here: you not only earn in the moment, but also avoid subsequent costs. You need to clearly understand what and how you will apply it, where in the architecture of your technical product will be done, and take care of the UX/UI model.
Even if you address this issue later, any changes during the release will require even greater financial investments. An insignificant well -thought -out strategy during the detection phase will help you address this in advance.
3 You certify the idea through users' willingness to pay
When developing and starting any software projects, it is of course impossible to go through the validity phase of ideas. This product approach itself is based on the release of less in a short time and immediately collecting reactions. What if users' willingness to pay is another way to prove a specific feature?
I touched on the topic of budget expansion, however, the smart use of current resources is also essential, especially when designing an MVP. Integration of money gain in the budget from the beginning, rather than investing the same amount of dollar in numerous features with unsafe return, can create a more reliable growth strategy.
Depending on the results, you will be able to make data-driven decisions and prioritize the project goal-turning unclear ideas into active strategies supported by concrete numbers.
4 You educate users for future loyalty to product
Current trends show that the so -called “Premium” user really REQUEST Exclusive: They literally require an environment for a valuable internet experience (Gen Z has grown!). Communities built around web and mobile products are reality today. It is essential to understand that selectivity and affiliation when paired with a structured good profit strategy are your Trump cards.
When you start earning an early money, even with an MVP, you can lay the bases for building a loyal user base. While the product can still be developing, providing a well -defined value proposal can attract users that evaluate its potential. These early adopters are willing to invest and have some expectations, enabling you to receive higher quality feedback.
Payment, in a way, is the entry threshold that provides results – remember Grindr, Headpace and Spotify. And about 'I will start earning money when …': If your app, service or vehicle is completely free and suddenly requires payments, what do you think will happen with the keeping rates the day after?
The last words
You can rely on the number of users to measure success; However, users vote with their dollars, and what matters is income and a strong, potentially useful statement of profit and loss (P&L).
Whether you are building and starting a digital product with your team, such as an Indie hacker, or partnership with an external development seller, make sure you do not make the mistake of bypassing money from the beginning.