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What is a MVP for a startup: how it helps to start a product

Monday, August 23, 2021

When we start our startup, we dream if not of the status of a unicorn, then at least of an active mass sale of our own product. Whatever you develop and offer to the market —  at the beginning it is good to understand how the target audience will react to this product, and understand before the full sales start. And here comes the working MVP system.

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Why do you need an MVP system if the product is mature and does not require a prototype phase? Because the creation of MVP (Minimum Viable Product) is different from the prototype, there is a fundamental difference. It no longer means a primitive version of development, but has the most basic functionality and performs the main task as best as possible. The prototype usually aims at identifying weaknesses in technical development and serves a completely different purpose. That is, the prototype can be compared to a point, whereas the MVP step is a process, primarily it means testing.

This is primarily due to the fact that a minimum viable product is not created to test the technology or refine the chosen technical solutions. In 2001, Frank Robinson introduced the concept of MVP, focusing on research into the reaction of the target audience to the product and the synchronized development of the product, depending on the reaction itself.

Creating MVP allows you to keep up with market demand

Going back to the difference with the prototype —  the reaction of the target audience will make it possible to adjust the basic characteristics of the product and the business model, to plan the roadmap, to change the strategy. Prototype testing on target audiences would not have yielded such voluminous results, nor would it have been possible to create a full version of the product —  unlike the MVP system. The prototype will allow you to test the technical implementation of the service —  yes. The prototype will not answer the question of whether someone wants your product and what will happen when you enter the market.

That is, first of all, a minimally viable product allows you to check how viable your idea and basic hypotheses are on real data, and how the system functions. This data will reveal for you the main trends within the market and the chosen area for further adjustment of the product development strategy and creation of its full version.

Why is it  essential to do MVP and what does it mean?

In this way you minimize financial losses for your business. By testing hypotheses with MVP and receiving data that he simply does not "enter" target audience —  you have a chance to adjust the strategy until the release of a full product. Along the way and in the process, you reduce the cost of development by identifying unclaimed features.

A significant factor is the work itself with the audience on which you are testing your minimally viable product. In this way, you collect a database that you can then work with a full-fledged product. Also, such tests are an opportunity to "light up" on the market with a product, and therefore attract the attention of potential investors at any stage.

What you need to know when launching an MVP
When running a minimally viable product, you should learn as much about the entire system as you can about the market where you’re going to run. This knowledge forms the basis of the initial strategy. At this stage, study the differences in the offer of competitors, the needs of clients, and their problems. You have to be different among already existing solutions: offer an innovative way or significantly modernize it. Clients should feel the difference. Otherwise, it would be unpleasant to fail, which would mean that you simply did not fall into the demand of the niche chosen.
Target audience

The next step in the creation and running of the MVP system is the detailed development of the target audience. Determine who your user is: do not target the widest possible audience —  this is a wrong strategy that will not bring you any more users. The narrowing and definition of the "kernel" allows you to more precisely and better orient your product and plan a marketing campaign to differ in the flow of other products. Determine the value of the product to the selected CA, how it solves its problems. How is it different among competitors, what is your difference, how do you integrate into the common system, and how will the product be scaled up? Also at this stage it is necessary to calculate the unit economy of the project, strategy.

Roadmap
 

Now that you’ve identified your TA and compared it to the product, the next step is to look at it through the eyes of the user. Create a path map, that is, the order of action that the client must take to reach your product, whatever that is. This path should be as simple and intuitive as possible —  and it is worth the time to work out the path map in order not to lose the user on the road.

The main functions of the MVP

As we have said before, the system of a minimally viable product must contain essential functions. At this stage it is important to define them —  to make a list of those options that will be available to customers in the basic version of the product. Additional functions are excluded for the time being, so you need to prioritize tasks, adjust strategy. To do this, think of what will attract the most interest and motivate the clients to give feedback that will solve at least one of their serious problems.

Next — it is already a matter of the market and collecting feedback. Display the product, test hypotheses and do not forget to collect metrics. Everything that you collect at this stage, and how you interpret it, will determine the future life of the product, which means —  and the entire startup. This is how your strategy should be built when launching the MVP system

MVP format
 

MVP can be created in a variety of formats. This can be a landing page —  a simple landing where you present your service and collect data about Ca, or a promotional video with a visual representation of the basic idea of the product. From more complicated formats —  "Wizard of OZ country" and "concierge". Both of them "pretend" to be fully functional automated services, while their main functions are manually performed by people.

It is also possible to use already finished solutions in "design" format to run MVP. For this purpose the tools developed before you —  scripts, software, application designers will be suitable. The most common format of an MVP system is a product with a single parameter that tests the viability of an idea in principle. If the main function is not needed, it is generally pointless to continue development, regardless of what additional functions were intended.
Success stories formed the basis of the idea of creating an MVP

The idea of an MVP system has become so popular, including due to the large number of success stories of business giants that have grown out of a minimally viable product. Take, for example, Facebook: initially, the platform was launched as a product with a single parameter — the ability to find classmates and exchange messages. And only then, after checking the viability of the idea, testing hypotheses, they began to add functions to the platform — and today Facebook is a huge corporation, a system, and the platform has a huge number of features.

When the MVP was created, Uber had only two functions —  connecting the driver and passenger, and receiving payment. It was this simplicity and timeliness that made it possible to win the market and the attention of investors, creating a multi-billion dollar international business through a simple application. If you look at it today, it’s already much more than two functions, but it’s more and not a minimally viable product. But at the time of creation, it was this difference that allowed us to distinguish ourselves from our competitors. 

And we can find many more such examples, absolutely canonical. Snapchat, Amazon, Twitter-they all grew out of a minimal product on which hypotheses were tested. 

Remember that the MVP system is about the process, unlike the prototype. About the process of testing, collecting feedback, finalizing and re-entering the markets. Thanks to the process and non-stop movement, it is possible to avoid creating useless products — which means the development of the market as a whole.

Apply the MVP system and become a unicorn!

 

23 Aug 2021

 

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