An Essential First Step for New Initiatives: Understanding Market Demand

by Peter Baron

Let’s talk about three conversations I’ve had over the past two weeks.

Each was a bit different but focused on developing new or expanding existing school revenue streams. If you haven’t guessed, I LOVE these conversations.

The opportunity to cultivate entrepreneurial skills to create financially secure school futures is why I founded MoonshotOS.

I won’t go into the details of what we discussed, but I will share the advice I offered to all three.

The success of any new program hinges on a crucial first step: understanding and responding to market demand.

It’s doing the pre-work to determine if:

  • The initiative is mission-aligned
  • There’s sufficient market demand (internal or external) to make the opportunity financially worthwhile and additive to the bottom line.

I love pointing leaders to Providence Country Day School (PCD), which recognized an opportunity to expand its reach by resetting tuition.

(Check out my interview with PCD’s head of school, Kevin Folan, to learn more: Inside Providence Country Day School’s Four-Year Journey to Nearly Double Enrollment.)

PCD determined they could expand the number of prospective families by 6,000 if they reset tuition to a lower level.

Their strategic decision was grounded in a deep understanding of the market dynamics and the potential demand.

As a wise CFO colleague once said to me, PCD made sure to understand, “Is the juice worth the squeeze?”

Boiling it down even more, I encourage you to answer the question: does the market opportunity justify the investment?

This is not just about financial returns but also aligning the initiative’s goals with community needs and interests.

So, as you consider new opportunities to iterate the model, keep going, but conduct comprehensive market research to ensure that the foundation for each is solid.

Because the last thing you want is to spin up a new initiative only to discover that it’s something other than what the market wants; that’s a drain on resources and momentum.

Remember, it’s not just about having a great idea but ensuring a market is ready and waiting for it. By aligning new initiatives with market demand, you can create successful programs and strengthen the connection with the community you serve.

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