12/28/11 | Uncategorized

The Zynga Method Of Market Testing ("Ghetto Testing")

By Ramit Sethi (Author, I Will Teach You To Be Rich)

One of the things you learn in my course on the best ways to make money on the side is how to fail fast and test things rapidly.

Compare this to people who say things like, “Yeah… I need to get my website up… so in a few months, once that’s done, I’m gonna try to get some clients.”

You may not know this, but I keep a bag in my pocket to vomit in when I hear this. It comes in surprisingly handy.

One of the deadliest traps entrepreneurs fall into is the sweeping dream. We have an idea, think it’s awesome, and then assume we have to build the entire damn thing before releasing or testing it. It seems logical but this is not how the most successful entrepreneurs operate.

Zynga (the company behind uber-popular games like Farmville) uses “ghetto testing” and Minimum Viable Products to test demand before going all-in on a new project.

How Zynga Assesses Market Demand

  1. Create a 5-word pitch for a new product or feature.
  2. Put it up on a high traffic webpage.
  3. If it gets clicks, collect the emails of interested customers.
  4. Build a ‘ghetto’ version of the feature.
  5. Test everything
    Rinse and repeat often.

Look at that list. This is one of the most successful companies online, and they wont even consider a long-term investment in a project unless five words can get people interested. These guys know they “only have so many engineering bullets” to work with. This is how they preserve them for things with big potential.

Same with you — you have limited cognition, motivation, and time, so focus on the biggest wins. (Most people never understand this for their entire lives and say things like “It couldn’t hurt to try, right?” Yes it can!)

You don’t need to be company of Zynga’s size to do this. Simply get into the habit of asking yourself what is the smallest or cheapest version of this idea you can test.

This post was originally posted at The Young Entrepreneur Council. The Young Entrepreneur Council (YEC) is an invite-only nonprofit organization comprised of the country’s most promising young entrepreneurs. The YEC promotes entrepreneurship as a solution to youth unemployment and underemployment and provides its members with access to tools, mentorship, and resources that support each stage of a business’s development and growth.

About the guest blogger: Ramit Sethi runs a blog on personal finance help where he covers automation, psychology, and earning more. The New York Times best-selling author of I Will Teach You To Be Rich, shows regular people how to live a rich life by spending extravagantly on the things they love — and cutting costs mercilessly on the things they don’t. Formerly, Ramit co-founded PBwiki, a venture-backed startup. Follow him on Twitter at @ramit.

Anne-Gail Moreland

Anne-Gail Moreland

Anne-Gail Moreland, an intern with Women 2.0, was on the StartupBus. She studies neuroscience at Mount Holyoke College, where she is trying to merge a passion for tech and the brain into a new wave of cognition-based technology

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