What Is an MVP (And Why Is It Essential)?
Posted 08 Mar by Sophie Kleshchuk
- the MVP must present sufficient value that users will try it out
- it should show sufficient benefit that these early users will be retained
- and it should provide feedback opportunities for the development of the product
Purpose of an MVP
- Test if it offers value. MVPs allow product developers to see if customers will find a product valuable or useful, without spending a lot to do so.
- Avoid mistakes. An MVP provides the chance to test the market and see what customers are interested in. Understanding this helps the firm avoid going in the wrong direction and making expensive mistakes.
- Gaining customers. Companies that have an MVP can gain customers and income, while those that focus on developing and delivering a more finished end product do not.
- Gain insight about users. Through releasing an MVP it is possible to gain insight about what users like and use and what they do not. This saves time on developing further in areas of disinterest.
- Fastest to market. An MVP can get to market very quickly and start to build up a brand reputation due to first mover advantage.
- Attract funding. If investors see the value in the MVP then this can serve the purpose of attracting investment to facilitate further development.
MVP vs. POC vs. Prototype
Minimum Viable Product
Proof of Concept
What is the purpose of the development?
To find out where the product adds value and what its core features are
To decide if the idea will be feasible as a product
To examine how the product will work in greater depth.
Does the strategy provide the company with customers?
If the MVP is well thought out, customers can be attracted from launch
Proof of concepts are usually not offered up to customers to use
Prototypes are usually not launched for customers to use
What are some of the main benefits that come from the strategy?
Making money from day one and achieving customer retention. Understanding the market
Attracting seed-stage funding. Seeing if the idea will work technically.
Seeing how the product might look and feel. Visualizing how it might function
Is it used internally or externally?
The product is used externally with actual customers and feedback can be gained from them
Tends to only be used internally or sometimes with investors
Tends to only be used internally
Does it function for customers?
The MVP is a fully functioning working product which has the most critical features operating
Minimum Viable Product Examples
Examples of successful MVPs
Examples of MVP failures
What Makes a Good MVP?
- It works. The MVP must be fit for purpose. If it does not work then users will fail to see the value and will not use it or buy it.
- It has a use. It has a use that people will spend money on or be willing to use it for.
- It is not perfect. The MVP is not a perfectly finished product with all of its final features built in.
- It meets an unmet need. An MVP should meet a need that is not currently met in the market. That might be through offering something that is faster or better in some way, or the product might be completely new.
- It is simple. The MVP should be the most basic possible product that can be delivered that can be used to validate the product in the market.
How do you plan and build a minimum viable product?
- Do your market research. Before starting, look at what is already on the market. Find out what features competitor products have and why customers use them. Look at quality, speed, design and features to gain a deep insight.
- Refine the concept. Based on what has been learned develop a business canvas for your product. This should include key activities, key resources, key partners, customer segments, customer relations, delivery channels, cost structure and revenue streams.
- Decide on priorities. Based on the market research and business canvas define the features that must be in the MVP. These will be “must have” features that make the product usable and that give it value for customers. These features can be included in the MVP and should be the priorities.
- Build. Develop the MVP based on the priorities identified. Do not get tempted to stray into other areas of functionality.
- Release and measure. Once the MVP is ready, release it to the market. Gather metrics on usage and learn from what this is telling you. It should give you an idea of who is interested and why. It should also provide insight into the features that like versus those that are not of interest.
- Refine. From here the product can be adjusted iteratively, continuing the process to ensure a customer focus throughout.