Minimum Viable Product launch is a good idea for those who would like to reduce startup financial risks, attract early adopters and study first user feedback. In general, the MVP idea is to check the startup hypothesis and its potential of being useful for the target audience.
Most of the well-known digital products from Facebook and Spotify to Airbnb eventually had been grown from the MVPs, or the early versions of themselves performing core functions only.
This article will help you to figure out how to build an MVP and measure its success. If an MVP concept is still being under cover of mystery for you, switch to our previous article on MVP definition.
Before Starting to Create an MVP, Make Sure, That Your Product Is Viable
The Lean Startup approach helps owners to spend their money and time smart. The tricky thing is that there are no limits for lean development and an MVP concept could be also tested before the implementation. Follow your tips to do so.
First, choose the criteria of the livability of your product. Keep in mind that an MVP is a ready-to-use product even though it doesn’t have advanced features.
To define the core function of your MVP, try to think of the main problem that could be solved with its help. Let’s take the Gmail web application and Spotify as examples. Gmail provides users with an opportunity to stay in touch by emailing each other. The Spotify application is an online music streaming service, it helps customers to enjoy tracks wherever they’ve got an internet connected device.
So what customer problem you are dealing with and what is your solution? Keep the solution bold within the MVP.
Second, make sure that your product could be demanded. Use the focus group opinion or make your own market observing.
Sometimes, we may have a great worthwhile idea that is likely to solve a real existing target group problem, but the fact is that the look-like solution has already been launched by your competitors. For example, there is a small chance that anybody could successfully launch another all-covering social media platform like Facebook. You don’t have to waste money on an MVP to learn this. For more examples check our article "What does MVP mean and why you need it?"
Finally, the focus group will help you to set a basic commercial goal and develop a monetization strategy.
Analyze Your Competitors. Indirect Also
How to build a minimum viable product? Start with competitive sector analysis.
An MVP will be thrown to the market where it will immediately interfere with the competitive environment. As we’ve mentioned above it is important to evaluate your target niche in order to check whether you aren’t doubling an already existing product. But that is not all. Competitors analysis could help you to define and focus on the unique features of your product and turn them into core ones.
Example. Researching the social media field you’ll soon figure out that there are some major players like Facebook, WhatsApp, Instagram and Twitter covering all interests of the diverse global audience. On the other hand, you may also find that there are no perfect social media platforms for those who would like to share reviews on books they had already read.
Direct competitors analysis also tends to give you a complete view of what to expect from your product. Learn the growth rate of the top companies from the niche, study the monetization model common for your field and set realistic marketing goals. As a result, it will also help you to attract investors.
Remember, that to study MVP feedback you need to persuade the audience that your product deserves its attention in general.
Think of the best way to reach your target audience evaluating promotional tactics of your competitors. Don’t forget that generation Z as well as the vast majority of internet users used to change their opinion every second creating a hype around a single product and completely forgetting it the next day. That gives you a chance to beat competitors fast.
Here is the list of competitor analysis steps:
- Identify direct, indirect and substitute competitors
- Learn: competitors products’ features, pricing, branding features, positioning, and reputation
- Figure out competitors’ strengths and weaknesses
- Shape the competitive advantage of your MVP
The last important thing is that not only direct competitors are those who may lure away your target audience. You main competitor could also be indirect and substitute. In order to identify them try to observe the customer’s needs from the customer point of view. Ask yourself “What substitutive solution is available on the marker?”.
Example. In 2019, Netflix with nearly 149 million subscribers admitted that its main competitors are not video streaming platforms like Hulu or Amazon Prime Video (which are far behind if we compare the revenue rates) but entertainment tools such as YouTube and PlayStation.
Building an MVP Sales funnel
Job Need To Be Done (JTBD) approach could guide you through the user funnel stage. According to the concept, from the customers’ perspective, any product is a tool to satisfy their needs. In other words, a customer just wants the job to be done and would like to spend on the solution less money and personal effort.
In that case, your task as an MVP creator is to link your product with an appropriate functional and emotional “job” and to compare if you propose the easiest way to make the job being done. If not — competitors will easily conquer you. If yes — move to user funnel development.
To get more downloads, sales and as the result early customers’ feedback, you need to think of your MVP sales funnel. A sales funnel is a term that describes the road potential users follow to purchase or download your digital product or, if required, to complete any other key actions.
To build app MVP with a perfect user funnel, set your goal first. In the case of MVP it could be one of the following:
- product download and permanent use
- in-app purchase
- early reviews
You may also mix goals or set some of them at once building an MVP. If you’ve got several target actions, keep in mind that you will have several separated user funnels.
User funnel exists regardless of whether you lined it up specifically or not. But it is a good idea to plan it in advance and keep watching the funnel all the time, gaining additional feedback from those who didn’t manage to leave a review or do the target action.
Generally, the user funnel consists of 4 stages called AIDA: Awareness, Interest, Decision, and Action.