What is “MVP” and why it is so important
In the startup world, a “final product” doesn’t exist. You can always add more features, optimize the algorithms and improve the UX and UI.
One of the most common mistakes is to strive for the perfect product before launching it in the market. To get to this perfect product, you need a lot of money and even then it’s impossible since you don’t have any feedback from your customers/users that allow you to understand their needs better.
“MVP” means Minimum Viable Product and refers to the most basic version of the product that delivers its main and core value to the consumer.
A few examples that will illustrate the meaning of MVP:
- Waze – Its MVP is the basic functionality that allows it to calculate the optimal roads to take given the traffic. Features such as Carpool and socializing with other drivers are not part of the MVP and can be added in a later versions.
- SnapChat – Its MVP is auto-deletion of messages after a defined time. Features such as AR and video editing were added years later.
MVP has different meanings in B2C and B2B. In the B2C world, the delta between the MVP and the final product is lower since the consumer usually has much more alternatives to our products, hence it should be as finalized as possible. The more technological the product, the bigger the delta, since the consumer has fewer alternatives.
In the B2B world, the main purpose of the MVP is to receive feedbacks from initial clients before launching to the mass market. Let’s take a new CRM product as an example. Such program has countless of necessary features. One of the most important aspects is the UX that must be optimized and easy to use. Before launching, the company should conduct a pilot with a few clients to verify its functionality and user experience.
MVP has several advantages:
- Focusing on developing the core of the product without wasting time on other, less important features
- Getting faster into the market and lowering the risk of having competing product beat us to the market
- Receive feedback on the product and get the chance of improving/changing the product before investing more money on R&D and marketing
How do we know what the MVP is?
The short answer is that there’s no accurate definition. Each product and industry has a different MVP based on market demands. The best way to understand what’s the MVP is to understand the true need of the customer and what existing solutions lack.
Using a comprehensive business plan and market research, helps to identify the main competition and understand the market need. The MVP should be able to address this need. Other functions should be developed at a later stage after the company’s cash flow is more stable.
How TARGO can help
MVP definition process involves making data-driven decisions and prioritization. Our goal is to help our clients drive their products to full economic potential.