Validation Experiments & Hypotheses
Hypothesis #1: Problem Existence 🔴 Critical
We believe that independent local businesses in walkable districts
Will actively seek coalition loyalty solutions
If they struggle to compete with chain rewards programs
We will know this is true when we see 60%+ of surveyed businesses confirm this as a top-3 pain point AND 5%+ landing page signup rate
Hypothesis #2: Solution Fit 🔴 Critical
We believe that local businesses and consumers
Will adopt a shared loyalty coalition
If it creates meaningful rewards through network effects
We will know this is true when we see 70%+ of pilot businesses rate the coalition value as "high" or "very high"
Hypothesis #3: Willingness to Pay 🔴 Critical
We believe that independent businesses
Will pay $29-59/month for coalition membership
If they acquire 5+ new customers monthly through the program
We will know this is true when we see 15+ pre-commitments at target price point from pilot businesses
Hypothesis #4: Consumer Adoption 🟡 High
We believe that consumers who value local businesses
Will download and use a unified loyalty app
If it offers rewards comparable to major chains
We will know this is true when we see 25%+ of pilot neighborhood residents download the app within 30 days of launch
Hypothesis #5: Coalition Management 🟡 High
We believe that business associations and chambers
Will pay $199/month to manage local coalitions
If it drives measurable economic impact for members
We will know this is true when we see 3+ business associations sign 6-month contracts with economic impact guarantees
Hypothesis #6: Cross-Business Redemption 🟢 Medium
We believe that consumers in the coalition
Will redeem points across multiple businesses
If the redemption experience is seamless and valuable
We will know this is true when we see 40%+ of redemptions occur at businesses other than where points were earned
Experiment Catalog
Experiment #1: Business Problem Discovery Interviews
Hypothesis Tested: #1 (Problem Existence)
Experiment #2: Coalition Landing Page Smoke Test
Hypothesis Tested: #1, #2 (Problem + Solution Interest)
Experiment #3: Manual Coalition MVP (Wizard of Oz)
Hypothesis Tested: #2, #3 (Solution Fit + Willingness to Pay)
Experiment #4: Pricing Survey (Van Westendorp)
Hypothesis Tested: #3 (Willingness to Pay)
Experiment #5: Pre-Order Commitment Test
Hypothesis Tested: #3 (Willingness to Pay)
Experiment Prioritization Matrix
| Experiment | Hypothesis | Impact | Effort | Priority |
|---|---|---|---|---|
| Discovery Interviews | #1 | 🔴 Critical | Medium | 1 |
| Landing Page Test | #1, #2 | 🔴 Critical | Low | 2 |
| Manual Coalition MVP | #2, #3 | 🔴 Critical | High | 3 |
| Pricing Survey | #3 | 🟡 High | Low | 4 |
| Pre-Order Test | #3 | 🟢 Medium | Medium | 5 |
8-Week Validation Sprint
Week 1-2: Problem Validation
- Launch coalition landing page with business waitlist
- Recruit 30 business owners for discovery interviews
- Conduct 15+ interviews, transcribe key insights
- Drive 1,000+ visitors via targeted Facebook/Instagram ads
Week 3-4: Solution Validation
- Analyze interview data, validate problem severity
- Build manual coalition process with 5 pilot businesses
- Onboard first 20 consumers, track cross-business behavior
- Deliver first coalition reports to business participants
Week 5-6: Pricing & Willingness to Pay
- Deploy Van Westendorp pricing survey to 100+ businesses
- Collect pre-order deposits from pilot participants
- Test consumer redemption behavior and satisfaction
- Analyze cross-business redemption patterns
Week 7-8: Synthesis & Decision
- Compile all experiment results into validation report
- Calculate minimum viable coalition economics
- Make Go/No-Go decision based on success criteria
- Plan Phase 2 MVP development or pivot strategy
Minimum Success Criteria (Go/No-Go)
✅ GO Decision
- 60%+ businesses confirm problem as significant
- 5%+ business landing page signup rate
- 7/10+ prototype satisfaction score
- 15+ pre-order commitments at $29+
- 40%+ cross-business redemption intention
⚠️ Conditional GO
- 40-60% problem confirmation
- 3-5% signup rate with clear improvement path
- 6-7/10 satisfaction with specific feedback
- 8-14 pre-orders with pricing flexibility
❌ NO-GO Decision
- <40% problem confirmation
- <3% business signup rate
- <6/10 satisfaction with fundamental issues
- <8 pre-orders even at lower price points
Pivot Triggers & Contingency Plans
Trigger #1: Problem Doesn't Exist
Signal: <40% of businesses confirm loyalty competition as significant pain point
Action: Interview businesses about their actual top 3 operational challenges; explore adjacent problems like customer retention analytics or referral programs
Pivot Options: Focus on customer data platform instead of loyalty; target different business segments (restaurants vs retail); shift to B2C consumer app first
Trigger #2: Solution Doesn't Resonate
Signal: <50% satisfaction with manual coalition MVP; businesses don't see value in cross-business rewards
Action: Deep-dive on specific pain points: Is it complexity? Lack of immediate ROI? Consumer adoption concerns?
Pivot Options: Simplify to single-business loyalty with coalition discovery; add human community manager role; focus on business association value first
Trigger #3: Won't Pay Enough
Signal: Acceptable price point is <$19/month or businesses demand revenue sharing
Action: Explore alternative monetization: higher transaction fees, consumer subscriptions, or coalition-level funding
Pivot Options: Freemium model with premium features; enterprise focus on business associations; revenue share model with lower base fee
Experiment Documentation Template
## Experiment: [Name] **Date:** [Start - End] **Hypothesis Tested:** #X ### Setup - What we did - Sample size: [Number] - Tools used: [List] - Cost incurred: $[Amount] ### Results | Metric | Target | Actual | Pass/Fail | |--------|--------|--------|-----------| | [Metric 1] | [Target] | [Actual] | [Result] | ### Key Learnings - Insight #1: [Finding] - Insight #2: [Finding] - Surprise finding: [Unexpected result] ### Evidence - [Link to survey data] - [Customer quotes] - [Screenshots/analytics] ### Next Steps - [Impact on product direction] - [Follow-up experiments needed] - [Go/No-Go recommendation]