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MVP'S AND WHY YOU SHOULDN'T CREATE A "PERFECT" PRODUCT STRAIGHT AWAY

Marketing Manager
Anastasia Shevchuk

INTRODUCTION

The acronym "MVP" has more than 70 meanings, whether it's the Most Valuable Player in the NBA, the Marketing Vice President of a successful business, or the Most Valuable Programmer in software development.

This article, however, is about a different type of MVP. The "Minimal Viable Product" and its importance in software product development.

The MVP development process is used to test the performance of a new piece of software, minimize errors in the final product, and reduce the overall cost of development. This is particularly applicable to startup businesses, where the resources, budget, and technical skills available are limited.

But what is MVP development? And why is MVP in product development so crucial? Let's take a closer look at the MVP development steps, some successful MVP examples, and the most effective project management methods for building an MVP.

WHAT IS AN MVP?

An MVP is a no-frills version of a product containing only the core features required to solve your users' problem. An MVP will provide immediate value while minimizing development costs. A Minimum Viable Product allows you to test key hypotheses, gather user information, and go to market quickly.

Sounds great, right? You simply pick the core features you need, test it on users, and continue to build future iterations of the product until it resembles the app you first dreamed of at the initial planning stage.

The development of a minimum viable product (MVP) will help you learn how target users experience and react to the app's core purpose. With this feedback, you can allocate the budget to the areas which best satisfy your overall business objectives. The process of building an MVP identifies user pain points and determines the proper product functionality necessary to transform weak points into strong ones.


MVP means

THE MEANING BEHIND MVP

The "Minimum" part of the MVP is about effort, which often translates into the number of features the MVP needs to succeed. The main problem is how difficult it is to quantify what the minimal set of features should be. When building your MVP app, remember that you need to get something on the market pretty quickly. The faster you finish an MVP, the sooner you will be able to collect user feedback. Start with the bare minimum: create wireframes, images of the app views, and clickable prototypes, then use these to make a visual presentation.

The "Viable" part means the MVP should make a profit. One of the main reasons for building an MVP is to get paying customers. If you are in the app business for profits, you should account for your monetization strategy. It could be a subscription or use in-app purchases, but an MVP app should be able to bring in some income. Otherwise, it's a failure.

The "Product" is the least controversial part: everybody knows what a product is. The product is a full-featured, tangible, and complete application.

WHAT IS MVP IN PRODUCT DEVELOPMENT? 7 STEPS TO SUCCESS

Step #1. Define The Problem You're Solving

The first step of successful minimum viable product development is to formulate a business idea. Put yourself in the customer's shoes and ask two questions: Why do I need this product? and How can it help me? Answering these questions will help you to understand the main goal of the product and find the best solution for satisfying future customers' needs.

Step #2. Define the target audience and narrow it down

Trying to satisfy a wide group of people is a mistake. Choose a specific audience to offer your product to. Create a full description of a person who is not only going to like your product, but also buy it without hesitation. Learn how old and how educated this hypothetical person is, what he or she does for a living, and what earning level this job brings them. Habits and hobbies will complete a description of a potential customer.

Knowledge about the customer's lifestyle allows you to find out if your future product aligns with the exact problem they face.

Step #3. Evaluate your competitors

Don't overestimate the exclusiveness of your product, especially when you know there are other companies within your industry. Evaluate your competitors strengths and weaknesses to define the functionality of your future product.

Define your competitors. Analyze who your top three rivals are, how long they have been in the market and what products or services they offer. Research whether they have a competitive advantage and estimate your ability to offer something superior.

Find their market share and research their past and current strategies, sales volume, revenues, and financial and marketing objectives. This data will help you understand how profitable and successful they are.

Use primary and secondary sources of information. The information companies share about themselves is the most reliable primary source for analysis. Visit their websites to read presentations, white papers, annual reports, blogs, and other publications. Secondary sources of information, such as magazine and newspaper articles, videos, survey reports, and books, represent public opinion about the company. Although these sources might be less reliable than primary ones, they can give you a bigger picture of the industry.

Dig deeper. Visit business events your competitors take part in, contact their former employers and, of course, use their product and analyze the feedback on it.

Step #4. Map out the User Flow

Designing your mobile product with users in mind is a vital part of the MVP development process. A good way to ensure that your users have a good experience with the first iteration of your app is to map out user journeys. This step will allow you to look at your product from the perspective of the user, beginning with opening the app and ending with reaching an end goal, such as making a purchase. User flow creation provides insight into how to design the app in a way that is convenient for users.

Step #5. List features and Prioritize Them

At this stage, you will be able to understand what features to include in your MVP as well as features to include on your product roadmap that are a lower priority. Determining the difference between what your user wants vs. what your user needs can help you identify and prioritize features. Implementing too many user-requested features too soon can harm the user experience and take away from the overall purpose of the product. The only features included with your MVP should be connected to your product's overall goal.

You could highlight all the features you think are 'nice-to-have', but not strictly necessary. When you have a list of features for each stage you then need to prioritize them.

The following steps will help you prioritize your features:

Ask yourself: What is the single most important action that I want my users to accomplish? (Note: this will be your main feature);

Ask yourself: What other features do I want to offer? (Explain why you need each of these features, then cross out the least important ones.)

Now categorize all the remaining features under the categories 'must-have,' 'nice-to-have', and 'unimportant.'

Once you've added all the stages and their features, draw a downward vertical arrow going from 'high priority' at the top of the column to 'low priority' at the bottom, and prioritize your features.

After prioritization, define their scope for the first version of the product and move to choosing the best-fit management method for building an MVP.

Step #6. Choose the best project management methods for building an MVP

With a defined scope of work, you can now start developing your minimum viable product. Let's take a look at what project management methods apply to building an MVP now.

Lean. Lean is an Agile software development method based on several core principles: eliminate waste, deliver as fast as possible, and build integrity. Practically, Lean applies iterative development with the build-measure-learn approach. With the Lean approach, developers can delay most of the design decisions, set a rapid feedback loop, and ensure they build a product that customers really need.

If you want to learn more about Lean Startup Approach, follow this link: "How to avoid becoming a product waiter: The Lean Startup Approach".

Scrum. Scrum is an iterative approach to software development that relies on the division of work scope to help teams deliver faster. Scrum allows developers to manage the development of features for MVP in sprints (short cycles between two and four weeks long) and hire a scrum master who will oversee the entire Scrum process and keep it running smoothly. An MVP may be released after the first sprint, and the development team can update the product according to user feedback in all subsequent sprints.

Still thinking whether to scrum or not? Perhaps our article on the subject of scrum methodology will help you make your decision.

Kanban. Kanban focuses on the work-in-progress model and suggests focusing on tasks as they appear. This allows for aligning the scope of work with team capacity. Engineers can continuously add tasks to a pipeline as they get feedback from users. Kanban may be applied after the first version of MVP is released and will be a powerful method if feedback is ongoing.

Step #7. Build, Test, and Learn

When all the data has been gathered you can start building an MVP. QA engineers will then test it, and if everything works and a minimal viable product is ready, the time then comes for alpha or beta testing.

Alpha testing can also be called a Friends & Family release, as you generally give an alpha build of your product only to a limited focus group, in most cases to friends and relatives. You could conduct alpha testing first before moving on to beta, or proceed directly to beta testing. As soon as the product passes alpha testing it's ready for beta testing.

When we talk about beta testing, we mean that the product is going out into the real world to be tested by real users. The beta testing period varies, but it usually takes 1–2 weeks to get sufficient feedback. Based on feedback from beta testing, you may consider implementing changes to the future versions of your product.

Users are the only people who can define what features your product lacks and what features aren't needed. After collecting user feedback, start improving your product again and then test, and learn, and build again, and test again, and learn again.
HAVE A GREAT IDEA OF AN MVP?

HOW TO MEASURE MVP SUCCESS?

Now we've answered the question: What is MVP development? There are several things you must take into consideration when measuring the success of an MVP. The analysis of product success can help predict the future scope of the product and how it would turn out in the time ahead.

Here are some of the most effective ways to measure MVP success.

Active Users

You can assess the success of your MVP by checking the daily and monthly active users. Check if your average active user metric is going up or down. This can tell you if your MVP is engaging the users or simply turning them away.

Sign-Ups

Another factor you can check to measure the success of your MVP is the number of sign-ups it can offer. The more sign-ups, the better your minimum viable product is performing among its users.

Customer Acquisition Cost

This is the amount you spend on acquiring a single customer. You can calculate it by using the formula: money spent on lead generation/number of customers. This will tell you exactly how much you are spending on acquiring each customer. If the revenue generated per user is less than the customer acquisition cost, the MVP is not profitable and you need to implement your revenue strategy or traction channels. If it is more, however, you can sit back, relax, and enjoy your success!

BENEFITS OF BUILDING AN MVP IN PRODUCT DEVELOPMENT

Opportunity to find investors and raise funding

An MVP can showcase the seeds of what is expected to grow into a genuinely exciting product. The audience will not only be a founding team, but also potential investors. If done correctly, an MVP will show a product in a good light so it can display the strengths which attract and convince people to invest their money.

Lower cost

Due to the focus on keeping the product to a "minimum", there is cost reduction in the development process. This is because the product is focused on a few core features to solve a problem, limiting the amount of time needed for the app build. An MVP also helps to prevent the final product from becoming overly complicated and requiring more sophisticated coding and solutions. By keeping the product and project simple, you can keep costs low.

Learn what your customers want

The ability to access validated learning in the shortest time possible is a great benefit of the MVP method.

It stops you from spending huge amounts of time and money developing a perfect end product you THINK people want, to instead produce a product you KNOW they want. By developing the minimum viable product and releasing it to the market in a short time, you can gain valuable feedback from your early users. This feedback can help you plan and prioritize what you can change about your product or business to become truly valuable for these users, and give them what they want. This means that if you decide to develop your product further, you know the market for it already exists.

SUCCESSFUL BUSINESSES THAT STARTED AS MVPS

Instagram

Initially, the MVP was focused on photo filters only. Users could take pictures, apply one of the suggested filters, and save their photos in an album on their device. Users liked the application, and it has since been updated to include videos, geolocation, tagging, hashtags, and integration with other social networks.

Amazon

Jeff Bezos made a list of products that could be sold online at the time, and his very first list included 20 categories. Later, he narrowed it down to five: books, CDs, videos, computer hardware, and software. He launched a simple website with a catalog of books. Once a customer ordered a book, Bezos bought it from a distributor and shipped it. Over the years the website scaled and grew. Today, Amazon offers many more products and is one of the world's largest retailers.

Spotify

In the early 2000s, when media piracy sites like Napster and The Pirate Bay were all over the internet, it seemed impossible to survive with a new music streaming platform. When Napster shut down, however, Daniel Ek - the co-founder of Spotify, decided to develop a new platform where users could get legal music instantly for a small fee. Daniel Ek and Martin Lorentzon built a minimal viable product that did just one thing: streaming music. The first to try this application were family and friends. When Daniel and Martin saw their idea was a hit, they presented the application to a larger audience. Later on, when Spotify was accepted by users, they signed more artists and expanded to more countries. Today, Spotify is an on-demand service for music, podcasts, and video streaming that's available in 178 countries and has millions of subscribers.


successful MVP examples

SUMMARY

MVP's are a crucial part of software product development because the customer feedback they receive allows managers to understand what features their customers need, what should be added, and what should be excluded. MVP development brings a great many benefits: from cost reduction to the invaluable opportunity of finding investors and creating the product of your dreams.

MVP's are a tried and tested way of giving your product the best chance of success, as evidenced by the successful MVP examples we looked at earlier. We hope this article helped you learn not only what an MVP is, but also how and why it can help you and your business succeed!
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