MVP: How to use this concept to validate an idea and grow with market feedback

feedback

Do you know everything about MVP? Know what the Minimum Viable Product is, how to implement and improve it to generate more results before investing a lot of money

In business, MVP stands for Minimum Viable Product – or Minimum Viable Product. It means building the simplest and leanest version of a product, using as few resources as possible to deliver the idea’s main value proposition. Thus, it is possible to validate the product before its launch.

So you had a great idea and you want to undertake it, right? One of the best known methodologies for the development of products and services is the Minimum Viable Product. It was created in the cradle of entrepreneurship and exposed along with the concept of lean startup.

The idea is simple: validate the potential of an idea before investing a lot of money in it. However, the execution of this concept is perhaps the main challenge for product and service creators. Which is understandable: throw the first stone who never got excited about a good idea and wanted to cast it in the best way possible!

Conceptually, making an MVP (Minimum Viable Product) is building the simplest and leanest version of a product (or part of it), using the least amount of resources (time and money) possible to deliver the main value proposition of the idea.

The purpose of this post is to show why and how to implement the Minimum Viable Product concept in your company (or even in your life/project). In addition, we’ll give you some practical tips for maximizing your resources.

Why should you consider the concept of MVP?

The origin of MVP goes back to the Lean concept, widely used by business giants like Apple and Facebook in their growth climbs. The central idea is to optimize the use of resources in order to ensure maximum return. MVP fits into this context as a method to validate the return on a given investment, even before the product is completely finished.

The tactic is basically to use creativity and reasoning to create a simplified version of what you intend to market. That way, you can test the receptivity of your product in the market. From the feedback received, you should develop your hypotheses about how your idea meets that demand.

The Growth Hacking is a methodology that relies much on this concept. Experiments are equivalent to MVPs and are implemented (where the real investment occurs) only when we know the result is positive. We often even test several versions of MVP before adopting the actual solution.

Practical MVP example

Imagine a business model for a Mexican food truck. With the whole idea on paper, we have two options to start the business:

  1. Investing in the development of the best truck possible, customized and allowing the best warm burritos to be delivered to all corners of the city;
  2. Invest only in the development of the main product (your burrito recipe), fill the trunk of your car with them and try to sell them in some points of the city.

Note that the main value proposition of the food truck is present in the MVP: offer burrito wherever you want (or wherever the demand is).

For any endeavor, we can have good or bad results and in different proportions. Considering the three scenarios below as possible, let’s see what happens in each of them when we implement MVP or the final product:

In the business world it’s rare to hit the target on the first try and putting all your resources on a hunch is quite risky.

In the example of the Mexican food truck, the MVP concept validated whether the idea really had potential with real feedback. The use of the concept made the return on investment in a burrito food truck much more conscious, structured and predictable.

3 Simple Steps to Create and Improve Your MVPs

They are as follows:

  1. Define the value proposition
  2. Test market response
  3. Iterate

Next, SkyMarketing will take you to look at each of them separately.

First step: define what the MVP’s value proposition is

Every business model starts with the assumption that a given value proposition will attract the market’s attention and generate revenue to the point of making a profit. In other words, the value proposition is the main output of your product or service to the user.

Aspects that make this offer even more attractive or complement the product are seen as secondary at this time.

Think about your business’ value proposition. The image below is a great example of how to do this:

MVP - Minimum Viable Product

Step Two: Test Market Response

After developing an MVP that addresses the value proposition, it’s time to understand the market’s interest in the product to the point of justifying the investment.

There are many ways to validate the idea. One of them is to do an alpha test, which consists of launching the product or service to a controlled audience. In the beta test, the MVP is released to the general public.

In the food truck example, we carried out the tests in the places where we intended to sell with the truck, that is, we carried out a general launch.

Attention: controlled releases are best suited for solutions that may present unexpected problems if there is a lot of demand. This is the case in the software market.

In this step, we need to do two things masterfully:

  1. Understand the audience’s level of receptivity to your value proposition
  2. Learn what are the main points of improvement that can/should be considered to increase results

Third step: the iteration

After testing the Minimum Viable Product, it is time to interpret the feedback received.

Not everything the user says makes real sense for their business model, but the market is still the best way to test your business model.

Before making the investment, assess whether your hypothesis needs further testing. So, prioritize what really makes sense for building value in your proposal.

If your perception is positive, move towards the final product. Otherwise, use your learnings to formulate a new hypothesis and align your value proposition with market aspirations.

5 tips for creating an MVP

  1. Focus on the core value proposition and hypothesis creation. It will actually dictate the level of demand for your solution.
  2. Do benchmarking to find shortcuts. Learning from others’ mistakes is always cheaper and saves a lot of development time.
  3. Before testing any MVP, know what a good or bad result is and how to measure it. If this is not possible, rethink how to validate traction with the market.
  4. Apply your MVP to a realistic context. Using your friends and family as representations of the market often drastically skews the data and can drive bad decisions.
  5. It is always interesting to create metrics for your business. They will provide the necessary lessons for you to replicate successes and avoid mistakes.

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To finish

The concept of MVP was born in the context of startups, mainly technology. However, the line of reasoning is applicable to virtually all projects.

You can put this methodology into practice from building businesses to relationships. Furthermore, you can base your investment on customer feedback.

The great difficulty is knowing how to eliminate aspects that we often want to do, but which have not yet proven to have functionality and payback.

Besides MVP, thinking about running a business is not easy. That’s why we’ve put together several solutions that will result in scalability for your company and more time for you. It’s the Small and Medium Business Productivity Kit, which is free and can be accessed below!

Frequently Asked Questions:

What is MVP?

In business, MVP stands for Minimum Viable Product – or Minimum Viable Product. It means building the simplest and leanest version of a product, using as few resources as possible to deliver the idea’s main value proposition. Thus, it is possible to validate the product before its launch.

What is an MVP project?

An MVP project is related to the Lean concept, which is, optimizing the use of resources ensuring the maximization of return. In this case, you need to use your creativity and reasoning to create a simplified version of what you intend to market. After testing your product’s responsiveness in the market and receiving feedback, then it’s time to develop your hypotheses about how your idea meets that demand.

How to create an MVP?

To create an MVP project, the first thing that must be done is to define a value proposition, that is, how your project will attract the market’s attention to generate profit. Then, understand the market’s interest in the product or service (that justifies the investment), and finally, interpret the feedback received.