How to Achieve a Product-Market Fit with Your Product

Vivek Dixit

One of the most important concepts in lean startup methodology is product-market fit, but it is often poorly defined. 

Product-market fit is a term coined by Marc Andreessen in 2007 when he wrote

"Product market-fit means being in a good market with a product that can satisfy that market." 

That's the idea, but how do you get there?

Some tech companies (such as Facebook) have achieved product-market fit almost immediately. They launched their products and they were an overnight success. The rest of us will probably take much longer to achieve the elusive condition of being in a good market with a product that can satisfy that market.

If you're starting a tech startup, it is critical to have an idea of what product-market fit looks like, how you can achieve it, and, most importantly, when. 

So, what is product-market fit?

Product-market fit is the point where your product (or service) has reached a level of desirability that makes it attractive to enough customers so that you're able to sell it at an appealing rate, but not too fast.

In a nutshell, the demand for your product needs to match the supply that you produce. 

This balance is more important during periods of high demand. If your customer base is demanding but you don't have enough inventory, you'll be forced to refuse new customers and lose some money on them. 

One way to think of this balance is: are people buying it faster than you can produce it? If the answer to that question is yes, it's time to increase your production rate and find new customers. 

If the answer is no, you're producing more than you can sell (inventory) and need to find more people who want what you're selling.

Also, if your inventory is high and nobody wants what you are offering, you can't make any sales. 

And if this does not give you proper understanding, stick with me as we take a look at how to achieve a product-market fit with your product and what the benefits are if you succeed.

The impact of product-market fit

It's important to establish product-market fit because it can really help your startup to gain more profit. It is impactful in the long run.

To emphasize the impact of product-to-market fit, let's take the example of iPod and Microsoft Zune. 

Apple's first iPod had a very niche product-market fit, it only appealed to a small spectrum of people. The iPod changed the entire market as it shifted to digital music players, but the iTunes store and iPod mini were not able to reach product-market fit. 

Apple's second attempt at an iPod was much more successful. It reached product-market fit by including features such as video playback, games, and wireless access, which made it more appealing to many different consumers.

But, Microsoft didn't quite get this right when they introduced their Zune back in 2006. The Zune was a failure because people perceived it as being just another mp3 player on the market.

It failed to differentiate itself from others on the market and a lack of marketing made this even worse. Sales were poor - around 500,000 units - and it contributed to Microsoft's decision to sell its digital music business. 

By the time Apple launched the iPod, they had already found product-market fit and this new market was one that the Zune couldn't penetrate. 

Finding product-market fit is crucial for a startup and it's important to find this before you launch, not after. If you're able to achieve this balance, your startup will grow organically and will be able to scale up with demand.

How to find your perfect balance

The first step is to identify a basic idea for the product. Ideally, this should be done earlier in the ideation process. There are ways of testing the idea before investing in it, such as exploring if people will pay for it and at what price they would be willing to pay.

Once you have a good idea, come up with a minimum viable product. An MVP is your initial offering, but without all the extra features that you know may be desired by others. It is a product/service stripped down to just basic functionalities. This should give you a rough idea of your product's potential. 

Then do market research and see what customers think of this product. This will be represented in the form of an S-curve chart which will indicate when you have enough sales but not too many. 

Apple achieved the perfect product-market fit balance with the iPhone 4s over earlier versions of the same product. People were more interested in purchasing their device at that time, this was partly due to an update over earlier versions.

This was due to the better features and functionality that were included in this updated version of the phone. 

Apple had not made too many changes to the device, but they had added enough for customers to be interested in buying it instead of sticking with their older model.

The company had found the "product-market fit", as they were now attracting a lot of customers with iPhone 4s. They continue to make improvements to it, while at the same time keep the price high enough that they are making a good profit on each one sold.

Nike is another great example of a company that has achieved a product-to-market fit by selling athletic wear. 

Their success can be attributed to the fact that Nike has been able to find a way of making footwear fashionable as well as functional. 

To achieve this, they have engaged in plenty of research into their product and also how customers perceive it. T

his has helped them come up with new ideas for shoes while at the same time working out what customers want in their products. 

The result: Nike brought shoes that have been remarkably innovative and unique from the rest on the market. 

By achieving a "product-market fit" with their athletic wear, Nike makes more money without having to lower its prices. They stand out by charging higher prices for their products than others who sell similar footwear.

What you can do if you're not there yet

When you're not getting the product-market fit, you need to figure out where your potential customers would find your product, and how they might be able to buy it. For a new startup, this can require a significant investment in time and resources. 

To achieve the product-market fit you must focus on your customers and pay close attention to what they want.

When you know what the customers want, then it will be easy to adapt your product accordingly. You can do this while figuring out ways to sell it for a higher price.

There are many ways to gather customer data like running research or even conducting surveys. The moment you find out what the customers want, adjust the product to meet that demand.

If it is not possible to make the product better for customers, then take a step back and think of other ways of finding potential customers. Remember that not every company will have an opportunity to experience product-market fit.

However, if your market research indicates that your product has potential, then congratulations! Improve on customer data and achieve the perfect product-market fit for your product.


Product-market fit is when a company has a product that meets both the needs of the customers and the company. The company sells enough to make money while maintaining a fluid supply in the market.

In this article, we've discussed how you might find your own sweet spot and provided some helpful tips on how you could get there if you haven't yet.

If you are starting out with ideas and aim to launch a tech startup up, we can help with our Lean startup approach.  

The team of experts at BufferMint will help you every step of the way to make sure your SaaS product gets a perfect launch from its initial development. 

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