Product development: Minimum viable product (MVP) approach
As an entrepreneur, you would probably like to launch your product with all features fully functioning, having responded to all problems discovered during the market interview process. However, the unfortunate reality is that no matter how much you validate and research your product, it will never be perfect.
A more effective approach to product launch, and the best method of product validation, is to get the item into the hands of your customers and have them start to use it. Then make frequent, incremental improvements based on the feedback you solicit and receive. (Note that each ensuing product version is called an iteration).
Minimum viable product approach in product development
One way for a startup to secure feedback is to deliver the minimum viable product (MVP). The MVP approach is based on the premise that you can provide sufficient customer value by delivering minimal features that early adopters will use. You can then collect feedback that will enable you to build a better product that will resonate with future users.
You must understand what problems your market needs to solve. However, according to the MVP approach, you do not need to address every problem at once. Solve the most important and most basic problems, and then gather feedback. The idea is to maximize your learning and minimize your development costs.
The term “minimum” may conjure the notion that functionality is small and not valuable. But this is not the case.
The minimum viable product approach involves prioritizing product requirements to the point that they deliver core functionality to deal with the market problems; the rest is only “nice to have.” Note that this system requires more rigour than usual in prioritizing your requirements, as the nature of frequent iterations allows you to only address a small number of product requirements with each product release.
Most startups are tempted to release their product early and often. However, this is effective only if you can collect good feedback from early adopters who understand your vision and see beyond the (current) limited functionality; beware that some customers without this vision might have you building in circles.
The MVP approach relies on the following guidelines:
- Build a minimum set of features that enable you to gather feedback from visionary early adopters.
- Build only what is required.
- Release improvements to the product (product iterations) quickly and inexpensively as you learn about your market and your solution.
Using the MVP approach
To use the MVP approach, follow these steps:
- Review your prioritized product requirements, and understand the minimum level of functionality you can deliver. Although this could take six months to build, you must still deliver customer value.
- Build the solution. Whether you use the Waterfall or Agile methodology of product development, build your solution and take it to market.
- Validate your solution. Use beta programs, win-loss analyses, focus groups and market interviews to understand how your solution works for customers and how to improve it. Focus on customers who are early adopters.
- Review your product requirements again and restart the process. This cycle can be short or long, depending on what you determine to be the minimum viable product deliverable.
The MVP approach does not minimize understanding market problems or prioritizing requirements. It involves addressing, producing and releasing fewer product requirements at a time (that is, smaller feature sets).
The most useful form of product validation is real-world validation. Once customers use the product on a day-to-day basis, they will be able to provide the best feedback. Those customers who can see beyond the features that currently exist will offer the most value to you.
If you adopt the MVP approach to product development, you will have to commit to iterations, otherwise features may never be fully completed (that is, having all of the functionality you originally outlined in your full requirements). Be prepared that your team will improve a particular feature multiple times as they learn more about the product from the market.
Advantages of the MVP approach to product development:
- It enables you to maximize your learning dollar and minimize your development costs.
- It allows you to release iterations (that is, versions) quickly and to learn from your mistakes.
- It builds customer fans (also known as product evangelists) in the marketplace.
Limitations of the MVP approach
The MVP approach cannot be used in every situation, and has several limitations:
- The MVP approach requires a lot of effort to collect continual feedback from customers.
- It requires significant dedication toward small, frequent product releases.
- It might result in revising the functionality multiple times, based on ongoing feedback from customers.
Example: MVP approach
If you were to build a revolutionary voicemail transcription service, desired features might include the ability to download voicemails, send them via email and integrate them into SMS and MMS functionality.
Using the MVP approach, your first product release could be limited to the ability to download and listen to voicemails. This might suffice for an initial release. From there, you could learn what people wish to do with voicemails. For instance, you might learn that users have no intention of sending them via MMS, so you could avoid investing in that functionality.
Once you had gathered the initial feedback on your first release, you could proceed to adding the ability to send voicemails via email, and then evaluating that usage.
Ries, E. (2009). Minimum Viable Product: A Guide. Lessons Learned blog. Retrieved September 24, 2010, from http://www.startuplessonslearned.com/2009/08/minimum-viable-product-guide.html
Ries, E. (2008). Minimum Viable Product. SlideShare presentation. Retrieved September 24, 2010, from http://www.slideshare.net/startuplessonslearned/minimum-viable-product