Consumer insights from current processes such as surveys and focus groups is fundamentally flawed because there is no skin-in-the-game.
But what does skin-in-the-game mean and why is it so important to gathering reliable consumer insights?
In this blog we will go over the exact reasons why you need to add skin-in-the-game into your insights and what it even means.
What is the meaning of skin-in-the-game?
Skin-in-the-game is the concept of handing over something valuable such as money, time, information or commitment to you in support of your product.
This is the most valuable and reliable way to validate your product concepts.
Why collect skin-in-the-game
When we think about consumer insights surveys, we are asking consumers:
‘If we build it, will you buy it?’
The problem with this is that the consumer doesn’t have any stake in your product, it’s their opinion and if they don’t end up buying your product, it’s no loss to them. This let’s the consumer hand over their opinions, that are being classed as data, without them having any issues if the product fails or isn’t even built in the first place.
With this statement, the business is risking their time and money to go out and build this great product, the business is putting its skin-in-the-game and the market isn’t.
Instead we should be flipping the statement and saying to consumers:
‘If you buy it, we will build it’
By doing this, you are now putting the consumer in the driving seat and getting them to hand over the value you are looking for, or skin-in-the-game, so that you will build the product they actually want.
Now the skin-in-the-game is shared between the consumer and the business. They are putting skin-in-the-game to show that there is a real demand for the product you want to develop, and you are putting skin-in-the-game to actually develop and launch that product.
The difference now is, that you can gain tangible data on the demand for your product because there is a much higher risk to consumers when they say that they want your product to be developed.
Never miss expert insights and case studies on market success prediction with our monthly newsletter
There are many examples of Pretotyping being used, from IBM when PCs were just starting to become popular to landing page tests and Pretotyping.
But then is one perfect example of this, that has been around for a while and is even becoming a verb in it’s own right like ‘Google’ or ‘Hoover’, brand names that become so popular that they become verbs.
That example is Kickstarter.
With Kickstarter, most companies have skipped the Pretotyping phase and either created a prototype or have a small business running that they want to grow. But it doesn’t mean it’s not a relevant example.
The skin-in-the-game on Kickstarter projects is right there in front of you and it follows the same statement we made above:
‘If you buy it, we will build it’
You have to ‘back’ a Kickstarter project, whether that be a watch, board game or some fancy gadget, with your own money. You are paying money for a product that doesn’t exist yet, giving the company money to make the product as well as the skin-in-the-game to convince them to actually go ahead and build that product because there is enough demand for it.
This is the perfect example of skin-in-the-game, even within Pretotyping as it follows as similar format.
You create a landing page, like you do in Kickstarter, you setup your level of skin-in-the-game, like payment in Kickstarter and then you promote the page to see what the level of demand is, like in Kickstarter.
The difference with Pretotyping, is that you don’t have to build anything before launching your landing page, you only need to create a few concept images and write a page of content to get testing.
Never miss expert insights and case studies on market success prediction with our monthly newsletter
Collecting skin-in-the-game comes in many forms and depends on the product you are looking to gather insights on.
The main forms that this can take are:
Payment
Time
Commitment
Information
Reputation
Generally speaking within Pretotyping you will focus on information because it is one of the quickest ways to setup a test and gives reliable data. The most reliable demand data will be received from payment types because it is one of the highest entry floors, after all:
‘It is easier to get someone to open their mouth than their wallet’
The way to collect information data then is to setup a Pretotyping test using a landing page with a data collection element.
An experienced growth marketer now helping Horizon and it's customers create successful products. Always looking to expand his ideas and take on unique and interesting takes on the world of marketing and product development processes.
.webp){kind=logo}
