First of all, when a team in an IT company comes up with an idea of an excellent piece of software, it builds a minimum viable product (MVP) as a draft version of a concept, that already has some real functionality, and can be tested by end users. In the case MVP works smooth, the team plans further steps of developing a stable product.
But there is still a problem for many startup companies: they sometimes fail to understand what MVP is about, and have an idea of MVP as a half working product with limited functions, demonstrating the direction of their thinking. In fact, MVP is a process of testing hypotheses about a product and making corrections according to the results of this tests.
The idea of a Minimum Viable product (MVP) belongs to Frank Robinson, then it has been further developed by Steve Blank in the 1990s and then Eric Ries’ Lean Startup movement in the early 2000s. MVP has been defineed as an initial phase of the product development: “the version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.”
So MVP is a process, it is a limited test of the initial concept, delivering simplified version of the product or service to the market and measuring the outcome. MVP presumes cycles of testing and gradual improvement — during the development process, many assumptions, that may arise concerning the purpose of the product, architecture design, monetization or external factors, that can affect the way the product will develop. The team can’t be absolutely sure, which of these assumptions will be right or wrong.
There are several researches, that discovered nearly half of the startups fail because their product was not in demand. These companies had been working on their products for a long time before they realized, that the time they spent developing their products, was wasted. In order to avoid this sort of outcome, you have to give a possibility to your users to test your product during the stages of development process. Such tests will give you better understanding what users need and you will have a possibility and time to adjust your product.
This way of testing your product is common, and those who identify the limitations and correct them, gain better results even faster than those who don’t perform the revision. In IT world, this approach is called Lean or Agile. It is based on getting feedback from the end users of the product and rethink the way the product should be.
For instance, a company decides to create an app for restaurants, that would allow users to book places and include several functions, such as calendar of events, convenient interface and integrations with map services and social networks. A team of a company makes a plan of software development process and decides that it will have an ability to make MVP in 5 months. If a team uses this approach and vision of the MVP, there is a great probability, that it will be wrong about their predictions. The main reason is lack of research on market demand and lack of knowledge about the real needs of end users.
If a team plans MVP beforehand and perceives MVP as a product with limited functions it may lose a lot of time on developing a product, that will be useless and won’t meet the real needs of their customers. Instead, a team should perceive MVP as an ongoing process and start with a question: which of hypothesis is the most risky and how can we test it? In our example the most risky hypothesis is that the restaurant owners really need a mobile app. In order to find out whether they need a mobile app or not a team should make a research and ask restaurant owners about their needs, find out there knowledge level of technologies and ask them if they already use any software. After finding out, that restaurant owners need a mobile app, they have to test another hypothesis which is the following: what functionality do restaurant owners would like to pay for? In this case, the next MVP could be the websites for several restaurants with the main purpose of getting feedback from the owners about their impression of current MVP and getting comments about how much would they pay for that website.
The next question that may arise, is the marketing strategy. It is obvious that having developed a product, the team cannot visit all restaurants in the world an make offers there. In this case, it needs a landing page which will contain main information about product and examples of real customers. The page can be promoted through the social networks like Google, Facebook, Instagram and (maybe?) Twitter. If the users don’t leave any requests, the team should probably change layout of a website in order to increase conversion level.
So, this example illustrates the way of perceiving MVP as an ongoing process. The main thing that we should remember by developing a mobile app, a website or any other IT product is the following: which of hypothesis is the most risky and how can I test it?