The Value of Benefits Conferred on the User

Until you know what your program is worth to buyers, you cannot know whether you are addressing a viable market. Unless yours is a custom-made program, you will rarely be able to assess your income potential down to the nearest 1,000 dollars. The real question is whether the ballpark is the size of the Pacific or a skating rink.

The ballpark figure is a combination of quantity and quality. How many potential buyers are there? How much are they willing to pay? This is an area where you must be guided solely by the facts you are able to uncover through research and asking questions.

Fairly obviously, the more potential users there are, the easier it is to amortize the gear-up cost and the rosier your prospects of profit. The qualitative question, however, needs interpretation. Consider how potential buyers might justify your program. For example, if your product is designed to enable intellectual property lawyers to accelerate searches, draft patents, and check documents, your market research should tell you how much time it is likely to save them. Suppose respondents put time saved for these tasks at a minimum of an hour a week. That's 52 weeks each year. If there are 10 attorneys to a practice and each charges $250 per hour, the annual saving is $130,000.

With the program, they could offer a prompter, better-vetted service as well as having more working time to bill. They could pay you over $100,000 for the program and still be better off. You could reasonably assume then that they might willingly invest one year's time saving to enjoy that saving for many years after.

If you put your mind to it, the worth of a program can usually be quantified, either in terms of increased productivity, time saving, or capital economy. Furthermore, your software might help buyers hold on to existing customers or win new ones.

Every benefit that the customer sets a value on enables you to make your product an essential as opposed to a discretionary purchase.

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Online Survey Champion

Online Survey Champion

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