Why market trends matter for product-market fit

42% of new businesses fail because they do not serve a specific need in the market. One way to ensure your own business doesn’t fall into this trap is by following market trends that provide insights into consumer preferences, technological advancements, and broader societal changes that can all impact your product’s success. 

Key ways that market trends are crucial for product-market fit:

1. Consumer Behavior Shifts: Market trends reveal how consumer needs and preferences evolve. As an example, consumer priorities within the last decade have taken a strong shift towards sustainability – a 2024 Consumer Sustainability Survey showed that 85% of Gen Z and 84% of Millennials consider sustainability as important in purchasing decisions, and even amongst rising costs since the COVID-19 pandemic, 9.7% of consumers reported that they would pay a higher price for sustainable goods.
2. Technology Disruptions and Innovations: Companies that keep up with technological advancement along with careful consideration of how best to implement new tech are able to adapt their offerings to the market. At the same time, just because a technology is trending does not mean inclusion is necessary, as many businesses fail when they lose track of what the market demands. Many businesses fail when they seek to build a solution that is in search of a problem, rather than build to fulfill an existing need.
3. Competitor Positioning: Your own competitors’ responses to market trends can provide you with context on how to direct your own priorities. When a competitor changes their offerings, new opportunities can open up to exploit new arising needs or differentiate your offerings in ways that best fit your target consumers.

How to Identify Market Trends

Understanding market trends is about more than just following the latest fads: it requires careful analysis and the ability to distinguish between short-term shifts and long-lasting changes. Here are some strategies that will help you identify trends relevant to your business.

1. Use Industry Reports and Data: Regularly review reports from reliable industry experts like Gartner, Statista, and Deloitte Insights. These reports provide detailed analyses of current and future trends across various industries. For example, Deloitte’s 2024 Global Automotive Consumer Study surveyed 27,000 consumers across 26 countries on their opinions impacting the automotive sector, and is a helpful resource for any business that is tangential to the automotive industry.
2. Monitor Social Media and Online Behavior: Social media platforms are treasure troves of real-time information on emerging trends. Tools like Google Trends and BuzzSumo allow you to track keywords and topics gaining traction across industries. Pay attention to discussions on platforms like LinkedIn, Twitter, and Reddit to get a sense of what consumers are talking about.
3. Customer Feedback and Surveys: Collecting direct feedback from customers is one of the most accurate ways to stay in tune with evolving market demands, as they are the people closest to your products and their. Surveys, interviews, and social listening tools allow you to track the pulse of your customers and refine your PMF accordingly.
4. Industry Conferences and Thought Leadership: Participating in industry conferences or following thought leaders can provide valuable insights into upcoming trends, as changes in other products and services will often influence your own business model. The global smart phone accessory market is estimated to be worth $101.15 billion and is completely dependent upon smart phone design and manufacturing decisions.

Strategies to test product-market fit amidst a changing market conditions

It is one thing to understand current market trends, but it won’t do much for you without properly leveraging that understanding and adjusting your business model to adapt to them. Businesses can utilize a number of strategies to ensure their own products continue to have solid PMF. Here are a few:

1. Launch Trend-Based Minimum Viable Products (MVPs): MVPs are offerings that are the most basic, foundational expression of a solution to a problem presented by a market without any extra frills or additions and on a small scale. A way to confirm a new need in the market actually exists is by launching a new low-cost product that fulfills that need. Monitoring the success of the MVP then informs future decisions on whether to further develop the idea.
   1. Real world example: Uber started as an iPhone-only/SMS only app that used real people to connect riders with drivers, and was only offered in New York and San Francisco. From there, Uber became a globally recognized brand.
2. A/B Testing Based on Trends: A/B tests involve testing two versions of a product on a small scale to test the market’s response. This could include testing different pricing models, product features, or marketing messages. Collecting data on the performance of each product will inform you on how to adjust your offerings and messaging to fit new trends.
3. Monitor Sales and Engagement Metrics: Use your Customer Management Software or similar platforms to track and collect data on how customers respond to your trend-driven products. Ensure you have business operations that include a regular review of sales metrics like conversion rates, and identify the market trends that create both positive and negative outcomes in consumer behavior. Working on PMF is an ongoing effort rather than a one-time project.

Bridge can help you evaluate your product-market fit

Adjusting your offerings and optimizing your business to ensure you have PMF is an ongoing process, and at Bridge we specialize in helping businesses stay ahead of market trends to do just that. If you are looking to take your business to the next level you can contact us today for a free consultation to find solutions tailored to your own needs.